Why People In Alaska Can't Watch Netflix Without Fearing A $US100 Surcharge

The most expensive movie my sister — KC D’Onfro — ever watched cost $US100 and she slept through half of it.

KC lives in Bethel, a small city in western Alaska, one of many rural villages and cities dealing with something that most people in the contiguous U.S. will be hard-pressed to imagine: Internet data caps.

When people in Bethel pay their monthly broadband bill, they’re paying for a fixed amount of Internet data — generally, 25 GB per household. And the overcharge fees are outrageous.

It was that fee that slammed KC. She pays $100 a month for 25 GB of data. One fateful night, she and her roommate decided to watch a movie on Netflix. Both of them fell asleep halfway through, but the movie played ’til the end, eating up two GBs of data too many and consequently doubling their bill for that month. (One hour of HD video on Netflix can use up to 2.3 GB of data.)

“Now, I don’t even consider Netflix until near the very end of the month, and I have to be sure that I’m no more than three-fourths of the way into my total data, at the absolute most,” KC says. “So it’s a very serious business — I have to poll people to figure out what that one very special movie should be.”

This notion seems crazy to anyone with unlimited Internet, anyone used to binge-watching entire seasons of their favourite TV show without thinking twice. In New York City, for example, you can pay as low as $US30 a month to Time Warner Cable to have unbounded wireless Internet. You probably have no concept of how much 25 GB of data really is. Unfortunately, many people in Alaska don’t either.

“The average customer doesn’t have a clue what they’re doing,” John Wallace, a self-described technology advocate, told Business Insider. “I hate to say it, but they just don’t.”

John Wallace has lived in Bethel nearly his whole life, and he owns and runs Alaska Technologies, a company which works with small businesses and nonprofits that can’t afford their own tech departments. Normal people also come to him with their Internet woes, and he has collected a lot of horror stories.

There were the two girls who had unwittingly allowed Dropbox to continuously sync to their computers: They racked up a $US3,500 overcharge in two weeks. One user’s virus protection got stuck on and it cost him $US600. Wallace has heard people say, “I was gaming and I got a little out of hand and I had to pay $US2,800.” Once, two six-year-old girls accidentally spent $US2,000 playing an online preschool game. Their Mum was totally unaware what was going on: Until she got the bill.

The huge slip-ups happen, but, as Wallace explains it, when you’re living with a data cap, you notice that the little things add up, too. Say you pick a news video that you want to watch on CNN. The segment might only be five minutes long, but you have to watch a 20 second commercial beforehand. That commercial might cost you $US0.50 worth of your total data.

“Nobody likes to talk about it,” he says, “But porn drives the nation and that kind of stuff puts people over the roof. Entertainment data always costs more than business data.”

Data caps completely change the way that people use the Internet. You could send countless emails on 25 GB of data, but any sort of streaming or video gobbles it up.

Sounds terrible, right? In rural Alaska, there’s no avoiding the capped data or astronomical overcharge fees: One communications company, GCI, has a monopoly and costs don’t look likely to change anytime soon (though Wallace says that they have lowered in the last year — his city no longer has the highest Internet rates in the country). Bethel’s prices aren’t even the worst. You can see all the plan prices on GCI’s website (check out the prices in the tiny hamlet of Atka):

The history of how Alaska came to rely on this broadband monopoly is long, complicated, and fraught with questionable decisions on the behalf of lawmakers, but, a data-capped future isn’t as far-fetched or distant as the average Internet user might like to think.

Comcast, AT&T, and Time Warner have all experimented with data caps in the last several years.

“It’s like boiling a frog,” Karl Bode, editor of DSLReports, told TechHive. “Carriers are slowly expanding trials and experiments — first voluntary — in order to make meters, caps, and overages standard for everyone. Unless you’re willing to pay significantly, significantly more.”

Rural Alaska might be setting an example that we’re all doomed to follow. If Comcast acquires Time Warner Cable, it may push for more data caps.

For now, though, John Wallace, will be continuing to try to educate people in Bethel about how much Internet they should buy and how to avoid going over their purchased limits. But even though he can provide people with a rough formula, he doesn’t know how to solve the real problem.

Because rural Alaska’s data cap is about so much more than watching movies or the latest viral YouTube video. It’s about equal access and opportunity. The Internet was meant to improve the lives of people in rural Alaska, but — because of the data caps and the sky-high overage fees — it ends up costing them huge amounts of money.

“We have one of the highest unemployment rates in the nation, and some of the highest rates of suicide, sexual assault, and drug abuse,” Wallace says. “The people that can’t afford it are the ones that are getting victimized. It was supposed to bring access — true availability of goods and services — but it really just brought a huge bill that many can’t afford.”

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.