Back to the future! Heavy downloaders who subscribe to Time Warner Cable’s (TWC) Internet service might soon have to pay for their excess.
Reuters confirms that a TWC memo leaked to Broadband Reports is accurate: The company will test “consumption-based billing” in Beaumont, Texas, to figure out if it’s an effective way to deal with the 5% of its customers that use “more than half” of the company’s bandwidth. The company will start signing up new subs with the plan, details of which aren’t disclosed, then evaluate.
Some of you may recall paying ISPs like AOL based on usage, but all-you-can-eat broadband access has been the norm for years. It’s going to be an awfully tough sell to revert back to a use model. Still, this might be the least-bad option to deal with movie pirates and other exuberant bandwidth-eaters — at least compared to Comcast’s shady “network engineering” and invisible bandwidth caps, and AT&T’s hypothetical content filter.
With their stock in the toilet and increasing competition from telcos (and soon WiMax), cable companies will try anything to free up network capacity without increasing capex. So we aren’t surprised that TWC is testing consumption-based pricing.
The key: figuring out a way to do this that doesn’t suck. People are going to use more bandwidth every year for legitimate reasons — like HD movie rentals from Apple — and will sooner switch service providers than tolerate a bigger bill for “normal” usage.
Side note: Time Warner Cable was the first U.S. cable company to embrace Fon, a startup that encourages you to share your bandwidth with other Fon users via wi-fi. TWC will have a tough time convincing its customers to pay for “overage” charges that someone else is responsible for.
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