American Cable Association Wants Bandwidth Caps
The American Cable Association said that, like it or not, metered bandwidth Internet pricing is coming, and will be a necessity.
As displeased as internet users are (as in those who actually use the internet) about bandwidth caps, it seems that cable companies on the whole want consumption-based billing policies.
Cable executives who met for the American Cable Association's (ACA) annual summit expressed feelings that metered internet billing would be a part of the business future.
According to Broadcasting & Cable, ACA President Matt Polka said that metered pricing will be a necessity going forward for cable companies as they become broadband companies.
Polka gave that example of his heating bill in Pittsburgh, where he would love to pay the same flat rate all year-round for heating, but instead must pay more during the winter months. With all the network expansion and new internet services such as Netflix streaming, Polka said that cable companies won’t be able to provide service for just $40 per month.
Patrick Knorr, general manager of Sunflower Broadband, which has had bandwidth-based billing for four years now, said that a grandmother who just wants to read e-mail should not have to subsidize the college kid who downloads HD movies to watch later.
Knorr added that metered billing is the only way to manage infrastructure and that charging a flat rate "is not a sustainable business model." Sunflower Broadband currently offers an entry-level 3 GB service tier for $27.95 per month (without video bundle discount). Those who crave the top-level service can get 50 GB for $59.95 (without video bundle discount) per month. Those who go over their quota will be billed at $2.00 per GB, though customers can buy more bandwidth in advance in 15 GB blocks for $10 each.
Sunflower Broadband tries to put its bandwidth caps into perspective using data from more than two years ago. As quoted from its service site: In April 2007, 98.9% of users had less than 40 GBs of bandwidth usage, 86.98% of used less than 10 GBs, 49.46% of used less than 1 GBs of bandwidth usage per month.
Knorr went on to say that, unlike satellite, broadcast, and cable, the internet is not a particularly efficient way to deliver high-res video.
We’re personally of the opinion that the internet is a very efficient way of delivering all sorts of data, video or not. What do you think? Do ISPs have to charge for bandwidth to sustain a business model, or are cable companies just trying to throttle back customers to keep them paying for traditional TV services?

Effiecent.. Maybe not for cable.. Guess what cable is not the only high speed internet solution.. So sucks to be them.
Effiecent.. Maybe not for cable.. Guess what cable is not the only high speed internet solution.. So sucks to be them.
Meanwhile competition will do it's thing. If it's possible to deliver more for less then someone will jump in. I left Comcast cable and went to ATT DSL because of quality issues. Bandwidth was fine but too many packet drops were killing my Vonage phone and VPN to work. Now I have less bandwidth but latency is lower and reliability is better.
People that don't have a choice are screwed but that's nothing new. ISPs can already adjust their pricing based on perceived lack of competition.
I don't believe those figures, and if they're real, they're on the verge of becoming outdated as online video content increases in popularity. The internet has become a necessary service for most of our generation. Abusing the rate of its growth would be holding everyone back.
If Comcast ever puts together a strict cap or consumption-based billing, I will find an alternative.
By the way, the statistics on bandwidth usage were 2 years ago - April 2007, a lot has changed since then, I would say, with increased bandwidth usage and storage size.
Also the argument about your grandma subsidizing anyone whose using more network bandwidth doesn't make sense at all. If someone is paying for 5mb/s and using 5mb/s to dl something then how is he being subsidized by your grandma?
I know in GA, at least, has the option of flat rate or adjust rate for heat. So do not go around and fool people, you big CEO.
This is just like going out for dinner. You want all you can eat or a set meal?
Smaller ISPs can make more money with this plan, and bigger ISPs, with TV cable service, can make more money, plus driving companies like Netflix out of business (cost to join Betflix plus paying for downloading movies).
Of course at that time the other ISP's will start crying, there will be law suits, and when their companies begin to fail because of bad business models they will start begging for Tax payer funded government bail outs.
This is problem #1 in modern business, "Get as much money as you can, as fast as you can"; this almost always leaves the company dead and many people unemployed.
Let's do a little math on the 10Mbit commit and see what kind of charges I would incur.
10Mbit = ~1.1MByte /sec (effective)
66MB / minute
4GB / hour
95GB / day
2.851TB / month
My Cost: $200 for 2851GB
Their cost (I'll estimate $10 per MBit): $100
Ok... You tell me that this is complete BS... I understand there's a need to make margin on this, and there's a need to re-invest in tech, but there are simply better ways to control high bandwidth usage. I can bet that bandwidth is the lowest cost item for these companies. Highest cost items would be their employees, infrastructure and head equipment.
I would rather see the cable companies come out and say we'll give you 2MB of gauranteed bandwidth for $50, you can burst up to 10, but they may cut this back at most to 2MB during periods of high demand or if the user is using too much (> 95th percentile?). This would be reasonable with no supprise bills and allow good burst speeds for the movie watchers and downloaders.
The thing thats insulting about the metered approach isn't really the tact. Its a logical approach when you charge 1~10 cents per gigabyte, but the rate they want to charge is too much. Also the reason for these bandwidth caps is that the cable companies are refusing to upgrade and build their fiber-optic network with the profits they generate to do just that. Only a handful are investing in that sort of technology.
Light and cheaper plans are already available, but COX and TW are hiding those plans on their web sites. They will offer those plans only if the grandma ask for it and threatens to quit. So do not work for the cable propaganda. Grandma don't need 10Mbps download speed to read her e-mails. She will be just fine with 1.5Mbps or slower. All BS about the cap is about the Videos. They are very use to old practice to rip us for programs that we don't want. The crappy analogy about the heating bill is even more manipulative. The gas company provides the natural gas. The electrical company is producing the electricity. The GB that I receive or send over the Internet is produced by me or my friends: Pictures, Videos, etc. They don't have right to tax me for that. They provide the pipe and I will pay for the pipe. If someone want big pipe he will pay more.
The size of the Internet pipe is measured in Mbps not GB.
Well no Crap! Using Natural Gas, Propane and even Electricity requires fuel, resources etc. So yeah, it will go UP in the winter.
Internet is on a friggin' network of ping ponging signals. I can understand if their Electric company charges more because electricity went up, we should help cover the electric bill.
But why cap? There's no need to cap. A cable hub, server, etc, probably uses the same energy whether they are Idle or running full tilt. So whether I just check mail 1 month and watch Netflix on Xbox360, use vonage phone and play MMORPGs for a month shouldn't even make them blink. If they want to limit us, limit us by Mbps, not by how much we transfer! Hell, how much Bandwidth is eaten from the CableModem sitting ilde w/o a computer even turned on just staying active to the network? What if you watched everything you did to Try not to hit the cap, but Pop-ups, Block Ads, hell, even Windows, Anti-virus and other stuff self updating and self checking for updates eating away GB's you don't even know. Yeah, they won't even eat 1MB, but in a month's time all updaters that can be run on a machine adds up. Multi computer home? wow! Myself 2 computers. Wife 2 computers. 2 kids with computers and school wireless notebooks. Wow. So I'll get to cancel Netflix, Gold Membership on XBox. 4 EQ2 Accounts. Vonage Telephone and just go Cell. Screw sending the family our pictures and baby's first words.
Makes me want to go back to Dial up on principle (Just a hell of a lot faster).
Look up Greed in Dictionary... A.C.A.
Need a new Internet Transit system!