Due to the massive amount of backlash from the press as well as customers, Time Warner Cable at the end of last week introduced essentially what is the company's unlimited download plan, for $150 per month.
In actuality, what the plan is of course is TWC's 100 GB $75 per month plan, which the company increased from a lower cap not too long after it realized people were becoming irate with its cap proposals. If you pick the $75 package, the overage charge is limited at $1 per gigabyte up to $75. This essentially gives you unlimited downloading for $150.
However, even with the limit on the overage charges, TWC's price structure is still very much out of line with the rest of the industry, including those of its direct competitors in the cable space. Outside of the cable space, TWC's price is even more ludicrous.
Consider Verizon's FIOS service, which is a direct fiber line to your home. At it's cheapest package, Verizon offers a 10 mbit/2 mbit down/up connection for $49.99 without any download cap. This package is already just as fast as TWC's "turbo" package. Customers can choose to go all the way up to Verizon's $144.99 package which gives the customer a whopping 50 mbit/20 mbit connection--far superior to anything TWC has to offer.
TWC does have a cable service based on Docsis 3.0, delivering speeds of 50 mbit/sec. download and 5 mbit/sec. uploads. The service is $99 per month but TWC did not specify whether the service comes with a download cap. If the Docsis 3.0 plan comes with a cap equivalent to its Turbo service, the price would be $174/month--still pricier than Verizon's faster FIOS service and more costly than an equivalent $139/month service from Comcast.
TWC says that its restructured, and more expensive pricing schemes are due to increasing network support costs as users download more. Despite this claim made by TWC's COO Landel Hobbs, TWC's financial reports for 2008 revealed that its costs declined even though its customer based increased by 10-percent.
If TWC executives can't agree with their company's own reports, what makes them think that customers will agree? This is why TWC has decided to roll out its new plans first in areas where it is the majority or only provider of broadband service.
Image: courtesy of Wired.com/Dennis Crothers --source, TWC.
