It’s coming to my area:
In April, Time Warner Cable will begin collecting information on its customers’ Internet use in the Texas cities of Austin and San Antonio and in Rochester, N.Y. Consumption billing will begin in those cities later this summer.
Fighting29th explains:
There’s nothing wrong with the concept of usage-based Internet pricing, but all of the usage tiering I’ve seen is unrealistic. Time-Warner’s is no exception: by one calculation, their top tier, which is still pretty limited, would lead to $200/month in overage charges for a family whose use I’d classify as “moderate”.
I will switch to our other broadband provider, Frontier, ASAP, but they have also proposed internet usage caps (of 5GB). Fighting29th expands:
There’s little or no competition in the home Internet market — Time-Warner has a monopoly in large parts of the 29th district. One way to get a real market here and elsewhere is to treat Internet service the way we treat telephone service. Local service – the connection to the nearest switching center – would be the responsibility of Time-Warner or Frontier and have a regulated, low price based on the actual cost of delivering the service. At the switching center, other, nationwide bandwidth providers would be able to compete with Frontier or Time-Warner for our Internet business.
Like long-distance, once real competition hit the market, we’d see an ever-diminishing cost for Internet bandwidth. It’s only because TWC and Frontier have a monopoly that they’d even consider $200/month Internet pricing. Their recent actions have shown that their Internet monopoly needs to be broken.
A website has formed to fight this, but who knows how successful it will be.
B
Sounds like this will also be a burden on places like schools and libraries that provide internet access for their patrons and students, and which have limited budgets.
Lavocat
Wow. It’s not like Time Warner needs to give me YET ANOTHER reason to hate them.
I would LOVE to see an antitrust suit come out of this. These fuckers have a huge market share and, like good little monopolists, they think they can now call the tune. FUCK. THEM.
Wisdom
Waahhh. Austin and Rochester. Why is it these liberal cities always only have one or two choices?
The free market dries up pretty quickly once local government gets involved.
Dave C
@Wisdom:
Heeeelllllloooooo, non sequitur!
Walker
No one could have ever forseen the problem of building telecommunication infrastructure by granting local monopolies to unregulated companies.
Davis X. Machina
You’re going to wind up debating a box of Refrigerator Poetry Magnets™, The Movement Conservative Edition, you know.
Zach
I don’t think there’s anything wrong with it legally or morally assuming they inform customers properly and give them ample warning before changing the service rates. However, it’s incredibly stupid in a business sense. High-bandwidth media is where ad revenue’s going to be in the near future. If you want to recoup your losses on bandwidth, offer an even faster service that’s proprietary or partnered with some media company and grab the profits yourself. Partner with Hulu and offer Hulu Express downloads on your regular lower-tier bandwidth offering. Verizon and others tried to do something like this with ESPN and failed, I think.
You don’t stop people from sucking up bandwidth, you shuttle them over to high-bandwidth services that you actually profit on, but you’ve got to aggressively and smartly identify new opportunities to keep up with market demands.
As everyone starts watching The Daily Show online, illegitimate high-bandwidth users will eat up a smaller and smaller chunk of the pie … that’ll also make them harder to spot based on bandwidth alone. It’s a little pathetic that TW is only getting around to implementing this now when it’s become an obsolete business model.
Krista
That’s absolutely ridiculous…$200/month?
And Wisdom, you’re full of shit. Our phone company (which is heavily regulated by government, and which is really the only game in town for phone/internet access) charges anywhere from $35 to $50 a month for unlimited high speed internet access, at speeds ranging from 1.5 Mbps to 10 Mbps.
Having only one choice is not a bad thing as long as the company that provides that one choice has a tight rein kept on it by the government, so that they don’t get greedy and start overcharging. It’s when you get an unregulated monopoly that things get out of control.
The Moar You Know
This is easy. I’m an IT guy and get all the network bandwidth I need at work. If they want to impose usage metering for the home, that’s fine. I’ll cancel my service and start getting some exercise.
These idiots need to realize that network access is not only not a necessity, but that some of us realize that we are paying some of the world’s highest rates for the lowest bandwidth in the industrialized world, and we’re tired of getting bent over with no lube.
John Cole
Probably not very. What choices do people have?
Miriam
Minneapolis has set up a wireless network that circumvents the phone and cable companies. I think that might be the alternative for most cities but I don’t know how likely it would be to help smaller towns and rural areas.
scarshapedstar
@Miriam:
I know that Verizon has successfully lobbied to destroy municipal wireless initiatives across the country. Maybe it would work in an actual democracy, though.
Wisdom
@Krista:
Wow. Just wow. Why is it you people get hysterical when Obama is called a socialist?
Let us see how much you enjoy your socialism when your government sanctioned monopoly follows suit. You will be paying what Austin does for their government-controlled power company. Whatever they pull out of their asses.
jibeaux
Heavens almighty, do I hate Time Warner Cable. Derned u-verse isn’t available here yet. I don’t even know anything about it except that it isn’t TWC so I want it.
I used to pay my TWC bill online every month manually, I dunno why. Anyway, a digit slipped once (I have a crap keyboard, which I’ve shared my thoughts with you on before) and so the payment got processed as a bounced check. Did they call or mail or email me to notify me there was a problem with my payment? No. They cut the service –internet only, not the cable, so I thought I had an internet problem — and I had to call India from my cell phone ("land line" is Vonage), who made me powercycle the modem and all that crap. After that, it’s ah, must be a billing problem then, please hold, *eternal Muzak later* to get to billing, took about an hour and a half all totalled on the phone, for a bill I could have gladly paid if I had known. Also they charged me a return check fee, which I got reversed the next month. And they raise the cable rates every year for Christmas, without fail, despite not offering, you know, any new services or channels or anything.
jibeaux
@Wisdom:
Krista’s in Canada, ya jackass troll.
Brachiator
Either Times Warner is incredibly stupid to the point of being self destructive, or they think that conumption billing will become the model for ALL internet service providers, cable, telcos and satellite.
The plan is doubly risky because although people may view the Internet as a necessity, economic realities may cause people to balk at paying higher fees for this and related service.
Mike
A website has formed to fight this, but who knows how successful it will be.
Particularly after Time-Warner, AT&T, Comcast, etc. block access to it.
Lola
I live in Austin and my household just learned of this so we are trying to switch from Time Warner to AT&T.
DougJ
Not many. If there’s enough of an outcry, maybe it can be stopped. I’m going to talk to my Congressman about it.
DanSmoot'sGhost
@DougJ:
Wireless broadband already has a 5g cap, has for years. I don’t know that it’s a big problem for anybody but the heavy downloaders of music and video.
I operate two "air cards" (wireless broadband modems), on Verizon and one Sprint, and they both have 5g caps on them.
Never had a problem. One of them is online just about around the clock.
Common Sense
AT&T is doing the same thing (in East Texas and North Nevada, which old Wisdom might want to note are no liberal bastions).
I just moved and switched at the same time from Comcast to UVerse. I absolutely love it so far and have convinced several family members to switch themselves.
That being said, this is coming. The only solace is that AT&T has a far more liberal cap on theirs (250G with a buck a gig past that, as opposed to TWC’s 40G max).
TheLorax
Living in new Zealand for 6 months and virtually everything is usage based. Cell/Internet etc. Though Cellular contracts are gaining quickly.
Internet is either Wimax or DSL. I’m on DSL (unfortuantely) that disco’s everytime the phone rings (yes I’ve tried talking to the provider and different filters) and am paying $60NZ (~$40US) for 20GB/month. If you go over the limit it slows to dialup speeds. That’s in addition to having to sign a 1 year contract and paying a $199 early cancelation fee when we leave in 6 months.
Scoreboard:
– 6 months usage
– 20 GB/month limit
– craptacular 190kbps down
– drops about 20 -30 times a day
– at a cost of $560NZ (~ $325 US).
Not sure on the costs of WiMax, but not available to me as I’m not LoS with city center.
Wisdom
@DougJ:
The Patchouli Economy. Nationalized internet, banks and healthcare. What could possibly go wrong?
Shalimar
I have a HughesNet satellite connection that has a relatively low daily download limit. During the first few months I had it, I went over the limit (which isn’t hard, it takes basically 2 hours of downloading multiple files at the same time) several times from downloading music. They slowed the connection down to maybe 1/5th of dialup speed for a full 24 hours after that and I have made sure not to do that again. I never even get to 20% of the daily limit regardless of how much I browse per day so it really just limits file downloads.
And they have a 4-hour window for 3am-7am eastern every day where downloads don’t count against the limit, so I just download any files I need then. It is a bit of a hassle, but not the huge amount it was those few days I was over-limit. Of course, I pay $69.99 a month for this privilege since there is nothing else better than dialup available in my area, so that is a hassle.
Rainy
I have dsl through ATT and they claim that 300 or so kb to 1.5 whatever is worth 25.00 a month. You don’t always get the advertised 1.5 whatevers. But they haven’t limited any downloading yet.
PaulB
@Wisdom:
You’ll do a lot better here when you learn to stop mindlessly regurgitating partisan drivel. Do feel free to come back when you’ve learned to think, won’t you?
South of I-10
This is exactly why I am so excited about my city’s fiber to the home project, which is run by our city owned utility system. Cox and AT&T have fought this tooth and nail for years. I am in the first build out and have been anxiously waiting my postcard letting me know the service is now available in my area.
Krista
Speaking of pulling something out of one’s ass…
I’m sorry to burst your happy little bubble, but when our power utility wants to raise rates, they have to apply to the Provincial Utility Review Board. That board is accountable to the taxpayers, and the buck stops at the Premier. So…if the Premier just let NS Power pull a rate out of their ass, as you so charmingly put it, then the Premier would soon find himself out on HIS ass.
But don’t let the actual facts penetrate your ignorance. I’d hate for you to actually stop and think — you might strain something.
David Hunt
@Wisdom:
Wisdom, setting aside the point that you are apparently berating a Canadian about Obama, she is summarizing a basic economic principle. I got my Economics degree at Texas A&M which has one of the more conservative Economics departments in the U.S. (at least it did when I was in attendance). Even they teach that an unregulated monopoly is a Bad Thing. To be more precise, a business entity with monopoly power is a Bad Thing.
It is in the interests of such a business to restrict supply of its product, causing the price it can charge to increase (or vice versa). This scenario brings about a situation where the business itself is yields higher profits, but the inefficiencies cause an Economic Loss to society.
In short, this is one the situations where the Invisible Hand gives us the Finger.
Rottenchester
@DougJ:
Good move, but I’d call or email TWC and complain to them, too. Just tell them you’re switching to Frontier. Frontier backed down from their cap (for the short term) after their call center was deluged by calls and emails from subscribers.
Thanks for the links, btw.
Stan
@Wisdom: Austin has the second-lowest electric rates in Texas, and among the lowest in the U.S. Only the "socialist" Pedernales Electric Co-op is lower.
This is in no small part due to the wind farm which provides 40% of the electricity flowing into the city. For a free-market example, see Dallas, whose "consumer choice" model has seen rate increases of 250% in the last two years.
Mnemosyne
Wisdom has no idea where the internet originated and who paid for it to be developed, does s/he?
Hint: Al Gore didn’t invent it, but he did have a little something to do with it.
Bootlegger
Godfuckingdammit! I just switched to Time Warner because my Windstream was kind of buggy. Same price and I have a one year contract. I’ll have to read that contract more closely and see if it protects me as well as my contract with my credit cards does.
J. Michael Neal
I don’t have a problem with charging people for the amount of internet capacity they use. People who download more cause higher costs for the companies. With flat billing, those of us who don’t download that much are subsidizing your usage.
What I do object to is monopolistic ability to raise rates. If these companies were operating in a competitive environment, I wouldn’t have an issue with this.
imasmart
http://www.dslreports.com/
Maybe there’s a local mom and pop dsl provider in your area.
Louise
jibeaux hates Time Warner and dreams about u-verse.
I, on the other hand, have had nothing but clean, clear, problem-free service from TW, while my parents have been treated criminally by u-verse.
The stats I’ve seen for the switch to usage-based service here in Rochester aren’t as dire as that $200 overage prediction, but I really won’t know until they get much more specific. I hate hate hate that this is going to happen, but I’m not rushing over to Frontier.
The Cat Who Would Be Tunch
@scarshapedstar:
Regardless of Verizon’s lobbying efforts, the real hindrance to municipal wireless networks is the technology itself. There are several key issues that make it problematic for consumer use in metropolitan areas.
First, a lot of the municipal wireless equipment use the WiFi standards (2.4 GHz or 5.8 GHz frequency bands). These bands are unlicensed, meaning you don’t have to pay the FCC or equivalent regulatory bodies a fee to broadcast on them. This sounds great since it means that it lowers the cost to sell equipment and service, right? In reality, this ends up being a double-edged sword because it means that ANYBODY can build a radio and transmit on the 2.4 GHz or 5.8 GHz bands. This can be a bad thing. Having multiple radios transmitting at the same time in the same frequency band is analogous to a teacher trying to teach over a room full of students that are chattering away. So when a city puts up a WiFi network, the engineers not only have to ensure that WiFi equipment don’t talk over each other, they also have to plan for individual businesses who’ve put up their own WiFi routers, microwave ovens (creates a LOT of interference for WiFi on 2.4 GHz), bluetooth equipment like headsets for cell phones, 2.4 GHz or 5.8 GHz cordless telephones and so on.
Secondly, planning for WiFi over a metropolitan area is pretty tough since the FCC limits how much power the WiFi equipment is allowed to use and transmit. Typically, these power limits are lower than cellular equipment, which means that it’s tough to get signal from the street lights (where most of the WiFi equipment is hung) to inside your office or apartment. You thought it was bad that you couldn’t receive calls on your phone when you’re inside buildings? Imaging trying to download a file, even something relatively small in today’s standard like a song. You’d feel you were using dial-up or worse.
Now I’m not saying that it can’t be done. It’s just that it’s really not economically or technically superior at this time. Consumers will almost always have a better experience with a wired line as opposed to wireless in urban areas.
Incidentally, in response to Miriam’s question, rural and surburban areas are perfectly suited for wireless access to the Net. In those areas, you don’t have the crazy amount of interference from people’s equipment nor the obstacles in the form of large buildings. Plus, going wireless means that you don’t have to dig miles and miles of trenches to lay cable just so that a single household in the boonies gets access. Not very cost effective as you can imagine…
The stimpack has provisions for billions to fund Net access to rural and suburban areas (I forget the exact amount) and most likely, it’s gonna be wireless tech that gets it done. It’s already been used successfully. In Nova Scotia, Canada, for instance, the government mandated that 100% of citizens had to have the option of access to the Net and a great deal of the province has already been covered via wireless.
As for TWC raising rates in my area, they can suck it. Ugh.
LD50
He also appears not to know what ‘nationalized’ means, either.
Funny how the wingnuts seem to be so terminally stuck in the sixties, isn’t it?
justcorbly
Nothing wrong with Time-Warner, unless you need to talk to them. Then, they’re hell on Earth. No one admits to anything (like "The guy who said he would be here Friday between 8 and 12 showed up at 4 on Saturday.") But, everyone apologizes. They don’t do anything, but they do apologize. That they’re good at.
Here’s what’s gonna happen: People who believe they don’t use the web much — email and browsing — will call T-W when they get a bill that boosts their internet bill. They’ll complain. And, then they’ll tell T-W to cancel their cable service. The net is more important to people than TV.
Meanwhile, the local DHL honchos will be mailing out scads of cheap introductory offerings.
Bottom line: T-W loses revenue.
Patrick
I also have a wireless card with a 5 GB cap. I’ve never even come close to 1 GB of usage. If there are users who are going over 5 GB, then it probably makes sense to charge them extra to keep costs down for smaller users.
From a business standpoint, the problem is that nobody has any idea how much 5 GB of online is. This whole thread is people upset, calling Congressmen, and such. Does anyone know if they are even close to that sort of limit? I doubt anyone is. It is like 150,000 page views of this blog. Now, if it takes you five minutes to read a page, that is 520 days of reading without stop (24/7).
HitlerWorshippingPuppyKicker
@Patrick:
Reasonableness and facts will get you nowhere around here, Patrick.
I’ve been operating 2 5g-capped broadband accounts for two years and have never had a problem, as stated above.
Personally, I think that WiMax is going to make all current broadband models obsolete, and not soon enough to suit me, but that’s 2-4 years out for most areas in the country. And then hopefully some price competition. I hate all comms providers and think they are all ripping us off, but all of that said …. a 5g broadband cap is quite generous.
HitlerWorshippingPuppyKicker
Just to wrap up the WiMax thing (it’s the 802.16 standard), this makes everything said about WiFi above just completely moot. WiMax is not WiFi, it’s wide area wireless broadband without using the hideous cellphone technical model. Sometimes referred as "last mile" wireless broadband delivery.
Hard to prove but I have this gut feeling that the big players like Verizon and Sprint and Cox are keeping WiMax at bay because it is giving them cover to rip people off using the current technology. But I hate those companies so I am not inclined to be objective about them.
dmsilev
@Patrick:
I pulled up the current stats on my laptop (which is my primary machine). Current uptime is 8 days; over that time, network usage over the WiFi link is 2.5 GB of downloads (that’s all from home, since I use a wired network at work). Figure about 10 GB a month.
That’s mainly web-browsing, with a fair number of YouTube/etc. videos. It’s not hard to imagine usage profiles that are far heavier.
-dms
jwb
My sense is that this is really all about cable TV, or rather the fact that TV is moving to internet distribution (via Hulu, etc.) and folks are beginning to cancel their cable subscriptions (or at least downgrade them to the lowest basic level they need to still get the internet). So Time Warner (and also AT&T to the extent it has gotten into the cable TV market) has a problem on its hands as the company sees the potential to lose a significant part of its revenue stream.
The Other Steve
I only downgraded my cable because they wanted $50 for me to get USA and TNT. No HBO or anything like that. So I’ve got the $15 one that gets me local plus CNN and TBS. It’s good enough for me.
Get this though… our townhouse association talked to Comcast and asked them if we could get a bulk discount for the community. They said if we signed all 300 units they’d give us the $50 package for only $18/month. But we had to sign up 100% of the units, which means it’d be in our dues.
Fuckers… their problem is they don’t understand volume pricing.
Anyway, I mostly watch my TV(except news) on the internet these days. Although even then it’s just shows like Life on Mars and such from ABC, NBC, etc.
The Other Steve
I don’t have a problem with a limit, as long as it’s reasonable. 5 Gigs is not reasonable.
I could see say maybe 50-100 Gigs. That’s a limit that’s gonna allow most people to stream movies, video, play games, whatever.
But it’d hit the abusers.
MrPook
@LD50:
The Patchouli Economy.
Funny how the wingnuts seem to be so terminally stuck in the sixties, isn’t it?
My poor olfactory senses wish Patchouli was stuck in the sixties, but alas…
On topic, I’m sure the cable intertube providers will use their monopoly to raise prices to absurd levels, then lose customers to WiMax in a couple of years, and then…ask for a bailout.
Joel
Clearwire sucks, but these cable providers are just opening the door for them.
Comrade Darkness
@J. Michael Neal, I too don’t have a problem with a payment system that dings the 5% of users with 70% of the traffic. That’s not what this is, though, this is punishment for all. This is going to drive some to the arms of $10 a month dialup, which still exists. Especially those with an internet phone who can chose which to use. My phone has unlimited data, so if I were price sensitive, I would definitely consider dialup.
Someone tried to start a competing dsl service in upstate, but the telco monopoly drove them out of business. They legally had 30 days (or something thereabouts) to give them access to hook up their lines and they would give them access at 29.9 days after the order was placed, oh and of course they would cancel the customer’s existing service immediately. No one with any sense would go ever change providers under such circumstances. The legally mandated access to the last mile of copper needs serious revision. Hopefully that will come up again given the outcry this is going to cause. Something more like 24 hours.
Comrade Darkness
@Patrick, your wireless provider must be blocking all incoming garbage, which is in their interests but does not happen with TW at all. Our firewall records well over a gig and a half of just garbage data every month (zombie machines trying to contact/infect other zombies, zombies poking at known security holes, etc).
greylocks
There’s a lot wrong with charging based on usage. Almost all of the cost of providing high-speed internet service is fixed. The wiring, routers, switches, customer support, etc. are load-sensitive mainly in terms of number of users, not the bandwidth they use.
In reality, if you have tiered or metered pricing, the heaviest users wind up subsidizing the lightest users.
Tiered and metered pricing has little to do with the actual costs of providing high speed internet service. It’s just a money grab.
There’s also some politicking here. It’s a backdoor way to gut network neutrality, which the big ISPs hate. If you tell the Big Lie often enough – i.e., that heavy users are costing them a lot of money – people who don’t know how the system works will start believing it (as several commenters here already do), and then the ISPs think it will be easier to get Congress to let them turn the internet into a system of pay-as-you-go toll roads, which is what they really want.
Don
I wouldn’t have a problem with usage-based billing if it seemed to mesh with reality. However the telcos don’t have a great history of charging based on reason.
For years they tacked a surcharge on your account if you wanted to use touch-tone dialing. It would turn out that supporting pulse/rotary dialing was more resource-intensive on the electronic switches they’d entirely moved to years before.
Currently they still charge an insane per-message texting fee on your cellphones. Someone calculated that the average cost per character is higher than beaming messages back and forth to the Hubble, despite the fact that on GSM networks texts go in "spare" space.
So my faith in them billing sensibly based on usage is about, oh, 0.
john b
@jwb:
what he said