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Time Warner Net Cap With 100GB "Super Tier"

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10:30 AM - April 8, 2009 by Marcus Yam

Time Warner Cable is planning to roll out new internet service trials that would limit monthly usage to 40 GB, a restriction that has many customers livid.

Time Warner Cable is planning to roll out new internet service trials that would limit monthly usage to 40 GB, a restriction that has many customers livid.

Time Warner Cable, which owns the Road Runner internet service, will this month begin monitoring the activity of its customers in select cities in Texas, North Carolina and New York in preparation of a rollout of new monthly plans with bandwidths limit starting at 5 GB for the entry level $29.95 fee all the way to 40 GB for $54.90.

The proposed plans have customers lighting torches and reaching for pitch forks, but TWC’s COO Landel Hobbs is now responding to the crowd in an open letter.

“Some accounts have even characterized our plans as punitive. Nothing could be further from the truth,” Hobbs wrote. “With regard to consumption-based billing, we have determined that as broadband usage and penetration grow, there are increasing differences in the amount of bandwidth our customers consume.”

Current Time Warner Cable internet service charges customers the same rate whether one uses it just for email or full blown movie watching. Hobbs says that this is unfair and not the way most users want to pay for goods that they consume.

Hobbs posed, “When you go to lunch with a friend, do you split the bill in half if he gets the steak and you have a salad?”

For that reason, Time Warner Cable plans to different pricing tiers with bandwidth caps at 5, 10, 20 and 40 GB, and overflow charged at $1 per GB. The company plans to roll out a monitoring tool so that customers may track their usage.

Due to the customer backlash, Hobbs revealed that the company is now developing a “super tier” (with appropriately super pricing).

“We have heard customer feedback, and understand that a 40 GB tier seems low to heavy Internet users,” Hobbs said. “We are developing a ‘super - tier’ now that allows for up to 100 GB of broadband usage per month in all of our test markets. We haven't confirmed pricing details as of this moment, but you have my word as Chief Operating Officer of Time Warner Cable that we will make this tier available to our customers.”

While a 100 GB cap sounds much more reasonable and usable than 40 GB, those who have the option of Comcast will see that company’s 250 GB cap even more reasonable and usable.

Hobbs does say that the Time Warner Cable plans aren’t set in stone and that there could be changes made to accommodate different types of usage. “I am convening a series of meetings this week to develop plans that will allow customers to choose among tiers that provide tradeoffs between speed and consumption,” he revealed. “If one family prefers to have lower download speeds but a higher data tier, or vice-versa, we want them to be able to make that choice.”

Hobbs adds that he believes that such plans are not only fair to the consumer, but will encourage more use of broadband overall. We’re not quite sure how setting limits on a service can encourage use, but Time Warner Cable is eager to hear what you have to think at realideas@twcable.com.

Source : Tom's Hardware US

Talkback
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jrnyfan 04/08/2009 4:54 PM
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I never thought I would be saying this and forgive such blasphemy but...I'm glad I have Comcast over this stupidity from Time Warner. They have been screwing their customers since the days of dial-up AOL and I feel bad for the people caught in their web of lies because that is the only internet access they can have at a bearable cost or at all.

particleman 04/08/2009 5:10 PM
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esquire468 04/08/2009 5:10 PM
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Quote :Hobbs posed, “When you go to lunch with a friend, do you split the bill in half if he gets the steak and you have a salad?”


Bad analogy. A more appropriate analogy would be for an "all you can eat buffet". If I am fixed at $40 per month for my internet, I am stuck at that price regardless of whether I order the salad (say 5 GB of usage) or the steak (100 GB of usage). Same goes for a buffet. I pay the same price regarless of how much I eat. The only difference is now TW wants to not only fix the price but also limit the number of return trips to the buffet line.

roofus 04/08/2009 5:11 PM
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Dont be too glad. Comcast will be doing the same thing. They are quietly watching and see how it goes. They certainly do not care about a bad image per say but will be watching to see if TWC customer base shrinks to see how they proceed.

joex444 04/08/2009 5:12 PM
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Consider for a moment that current TWC customers have been enjoying unlimited bandwidth consumption privileges (apparently its not a right, even when no metering is explicity mentioned in the contract) for quite some time.

Did TWC get complaints from the light users (who probably belong on DSL) that they felt it was unfair they are being charged so much for their low usage while others can use all they want (which is also the light users privilege at the time)?

The way TWC should act, IF they have the best interest of their users in mind, is to create metered tiers and leave their current scheme in place.

What I'm talking about here is keeping an unlimited $45/mo plan with the same speeds. Then you add in a 40GB/mo plan for $25/mo, with the same speeds to draw customers away from DSL (more customers = more revenue no matter how you look at it). And finally offer a "Super-Tier" with double the speeds for $65/mo.

If there is ANYTHING at all we should be learning from this and the Comcast cap is that we need to destroy the ARTIFICIAL monopolies given to the cable companies by our government. It's absurd that we can't have competition. And they have shown time and time again that they do not care about their customers interests and instead are simply greedy corporations with the honesty to rival a shady car dealer or a credit card scammer.

foxyg 04/08/2009 5:15 PM
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Any cap is bad, there should be no cap. And there should be more than 1 cable provider at 1 area.

mikeynavy1976 04/08/2009 5:21 PM
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I currently have Time Warner but am moving in a few months. Can someone please tell me if there's a web site that I can punch in an address or zip code and see what cable provider services it? I'll definitely be looking for a place that either has a non-TWC provider, has Verizon FIOS or ATT U-verse, or allows for satellite dishes.

Anonymous 04/08/2009 5:28 PM
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No matter how you spin it, the customers see this as a way to nickel and dime us even more as we are turning to other services available online rather than paying for your cable subscription.



If Time Warner implements consumption-based billing, I will be forced to cancel service and urge everyone I come in contact with to do the same.



My options for an ISP are limited, which Time Warner is aware of. I will switch to AT&T, and if they implement a similar system, I’ll forego Internet access altogether rather than be restricted by consumption of bandwidth.



I urge you to think about the long-term profit loss you’ll incur with this system. I believe you’re going to lose a lot more customers than you are anticipating.

jshumate 04/08/2009 5:39 PM
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The sole reason for the cap is to preserve the cable companie's market share in direct to home entertainment. More and more streaming content is becoming available from netflix, hulu, tv network websites, etc. and is being delivered right through cable's pipelines. Obviously they don't want consumers to have an alternative to cable tv service. So they just slap some cost barriers on that content under the guise of fair usage policy.

jshumate 04/08/2009 5:39 PM
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The sole reason for the cap is to preserve the cable companie's market share in direct to home entertainment. More and more streaming content is becoming available from netflix, hulu, tv network websites, etc. and is being delivered right through cable's pipelines. Obviously they don't want consumers to have an alternative to cable tv service. So they just slap some cost barriers on that content under the guise of fair usage policy.

duckmanx88 04/08/2009 5:40 PM
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damn esquire has it down perfectly. this cap is so ridiculously lame.i mean 5GB is nothing. heck if you reformat your computer and download updates and necessary programs you may have already gone through 1GB. just one hd movie on itunes is 3.5 GB.

im sending them an email thats for sure.

truehighroller 04/08/2009 5:44 PM
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I again say I have their turbo service and if they continue down this road, I will drop them like a bad habit on New Years. I work at home once a week and use a soft phone and that uses some bandwidth alone I am sure. Plus I like watching videos through hulu you tube and what not. I will not be paying them more money to use their service period. Time Warner's excuse (spin) = FAIL!

tayb 04/08/2009 5:49 PM
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Fuck off Time Warner. I already canceled my service and moved to Fios. Never again will I use your company.

Oh by the way at least two dozen of my friends and co-workers in the Austin area have switched to Fios as well. I wonder how many scenarios like this have played out across the nation.

TV (HD, DVR) + Phone + 2nd tier Internet = $140 a month. $140 *24 (ish) = $3,360 * 24 months = $80,640. Just walked out of your revenue charts for the next two years.

Voting with your wallets is a great thing. Anyone I know who has Time Warner will be heavily persuaded to drop them.

Hatecrime69 04/08/2009 5:49 PM
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Well at least somebody can make comcast look good :P

wyomingKnott 04/08/2009 5:58 PM
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tayb 04/08/2009 6:03 PM
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That is a great story there WyomingKnott but what you fail to realize is that these companies have been refusing, for years, to upgrade their services to accommodate more people and more usage. Over in Japan I can get an internet service 10 times faster than anything Time Warner offers consumers for half of the "premium" service Time Warner offers.

Had they spent money upgrading their lines and speeding up service overall they wouldn't have to be handing out bandwidth caps. The bandwidth caps themselves are just another excuse for Time Warner to be a lazy company and do absolutely nothing in terms of upgrades. More people want more speed so instead of giving them that speed they are introducing bandwidth caps so they can continue to add more customers without significant infrastructure upgrades.

Time Warner is just a shitty company.

timswar 04/08/2009 6:04 PM
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If this comes to Raleigh I will switch services immediately. My biggest use is Netflix streaming, and I have a feeling I'd break that 5gig limit pretty quickly. I'm currently paying 30 a month and have zero desire to pay double (for the slightly more reasonable 40gig) for lesser service. If I have to downgrade to DSL or some other setup I'd rather do that than put up with capping.

Antilycus 04/08/2009 6:14 PM
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nelson_nel 04/08/2009 6:18 PM
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esquire468 :
Bad analogy. A more appropriate analogy would be for an "all you can eat buffet". If I am fixed at $40 per month for my internet, I am stuck at that price regardless of whether I order the salad (say 5 GB of usage) or the steak (100 GB of usage). Same goes for a buffet. I pay the same price regarless of how much I eat. The only difference is now TW wants to not only fix the price but also limit the number of return trips to the buffet line.



I don't say this very often on here, but well said.

With that said, this is inevitable. Cell phone providers reap insane profits with their caps and so now too will ISPs increase their margins. And since we are so addicted, they will never feel any backlash in the form of lost customers because there will be no where else to go. This is also being reviewed as an effective means of thwarting piracy, if you haven't noticed either. An indirect policing of the internet. Enjoy. :(

Antilycus 04/08/2009 6:21 PM
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nelson_nel 04/08/2009 6:25 PM
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WyomingKnott :
What an unusual concept! Asking the customer to pay by what is used. Almost every business in the world follows this concept; why not internet access?On a broader scale, for the last 14 years I have been wondering how communications companies would make money (and make money they must, or we will not have communications). Originally, we paid the phone company for phone calls. Talk more, pay more. Connect to the Internet more, pay more. Then an interesting thing happened: VOIP (and its predecessors). Instead of data communication requiring that you pay the voice carrier for call time or a leased line, you could use data communication to not pay the voice carrier. It was an interesting dilemma for the phone companies. The clients were using a service that ran over their lines to eliminate paying for the use of their lines!The owner of the network has made an investment that allows us to use data services. Why should we not pay them back for that investment, based on our usage? It's a fair model. It's the equivalent of a toll road. Some roads are tolled, some are paid with from general tax revenue. A trucker prefers the latter, someone who rides a bike to work would prefer the former.I would be delighted if you-all would help me think about this in the context of a simple fact: networks are a large investment that must be paid for and return a profit. As more bandwidth is utilized, more network capacity has to be built. Unless you think that the Internet should be built and maintained by the government as a public service, that is. Or are there other alternatives?



Obviously, this can not be a blanket statement, but largely the investment has already paid itself off in returns...

The only company really investing in new network infrastructure on a substantial basis in America right now is Verizon and that is because they are RE-HAULING to fiber. So far, they have not yet capped... they will let the customers flee cable first. Make no mistake though, that will happen too...

MustWarnOthers 04/08/2009 6:28 PM
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Just another example of the greasy corporate swine sucking every cookie and crumb they can from their consumers.

My girlfriend and I just moved into an Apartment with a 1 year lease, so we opted for Time Warners "TV Phone Internet" package, which was 29.95 for each, for 1 year.

If they institute anything like this nearby, I'll be more than happy to take advantage of Verizon's 100 dollar package with all three services.

I have the option of Time Warner, Verizon Fios (just recently), Optimum and the very minimum.

Try and fuck me and you lose my business, it's quite simple.

formin 04/08/2009 6:29 PM
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lol 40 gigs is a joke
i watch 40 gigs of streamed porn a day
i dont think we should be throttling our internetz when the asians have internet 100 times faster than ours. its just technological crippling us and holding us back.

00101010 04/08/2009 6:34 PM
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Esquire, Joex444 and WyomingKnott all make very interesting points.

If we were to consider the analogy of the buffet, it makes perfect sense that if we all pay the same price but eat a different amount, no-one complains that one person ate more than another, it's all the point of the buffet. If we look back on the days of dial-up popularity, it was no different where some used dial-up constantly whereas some didn't use it much at all. Why not keep the "all you can use" option if people are willing to pay for that freedom, and are going to use it? I for one do use significant bandwidth daily.

Joex444 made an excellent suggestion of offering the tiered levels on top of the current structure. why not keep what people already use, but give additional options for lighter usage persons? You keep the base that already enjoys the service you have, and adopt a larger customer group with more options, not less. I have many family who would love such an option of fast internet but in limited usage amounts while others would go for the "full monty".

And last (but not least) WyomingKnott makes a valid statement about the fact that this is a business, and as such they are trying to turn a profit as well as maintain a highly reliable and costly service. At the same time I respectfully disagree that we should pay for "what we use". If that is the case, then why am I paying for cable capability that was run to households who chose to buy satellite, U-verse, or rabbit ears? Does that mean the cable company owes me a refund for what I paid for and is not in use by me? It is the company's choice, and as such they chose this model of business, and yet need to remain competitively priced.

I feel the flat rate unlimited use model is not only enjoyed by many, it's expected by many as well. Just like unlimited models of cell phone texting and other services, business competition will cause someone to continue an internet unlimited model. I hope T.W. will consider this for the sake of their business.


3p0ch 04/08/2009 6:37 PM
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I think that anyone who had the service before the caps were put in place should be allowed to continue the unlimited service at no extra cost as long as they wish. That if they are going to put caps in place, that only people who signed up for their service, knowing that the caps would be there, should have to suffer the penalty of those caps.

truehighroller 04/08/2009 6:39 PM
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I say some one puts together a petition and we let the President know about this situation and bring the fact that ISP's are monopolized to the light of him or our Congressman or whomever needs to know and can do something about this because I just tried switching to Verizon and they don't have service in my area and I want to switch now.. We need to all take a stand now and tell TW to shove their none sense making plans where the sun does not shine!

Turas 04/08/2009 6:44 PM
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What legislation is in place to prevent competition. I know a company would have a hard time starting up do to the costs but am curios why you can only get one cable company in an area?

garborg 04/08/2009 6:48 PM
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Time Warner is afraid of TV over internet and this proves it. Good job on losing more customers.

gamerk316 04/08/2009 6:57 PM
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to Turas: a lot of towns where I live have to give permission to set up a cable franchise; Verison was blocked by Cablevision for a long time here in NY (and now, FIOS is stealing tons of Cablevision customers).

We already got TWC to cave once (100GB), now is the time to continually attack on all fronts. Make it clear you are dropping their service (even if you don't suscribe), and force this to come to an end before it starts. If not, within a few years, we will have the same access as Australlia.

kynwal 04/08/2009 7:02 PM
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I don't have an option to not use TWC in Austin currently (no FioS) without moving. What I can do is cancel the rest of my cable services and just keep the internet. They are raising my price, and in these hard times (cough), I have to compensate and make important choices.

MustWarnOthers 04/08/2009 7:03 PM
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The thing that pisses me off most with these big corporations is that in most situations, a price is determined by supply and demand. The fine medium of what the provider will offer a good or service for, and what the consumer realistically and consistently pay.

But nowadays, it's more like "Charge the consumer the highest amount possible, for as long as possible, before they realize they SHOULD be paying less".

A good example was when I switched Insurance companies, from Progressive to Geico.

I found an incredibly cheap policy at Geico, and purchased it. When I went to cancel my Progressive insurance, the representative did everything in his power to persuade me to stay (which is fine, understandable).

I was re-quoted with Progressive nearly 25% less than I was actually paying currently, with the exact same driving record, exact same car, no new discounts for my age.

When I asked the rep from progressive "Explain to me why I wasn't ALREADY paying this 25% discounted amount" he had absolutely zero answer, and in a long string of euphemisms basically explained that I was paying that amount because I didn't notice that it could be cheaper.

If Time Warner can prove to the public that their Infrastructure costs are high enough to warrant needing to nickel and dime their customers, outside of the monthly costs, then I'll gladly reevaluate my opinion.

Until then, they are just another bloodsucking company squeezing more out of their customers, with no change in quality of service.


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