Time Warner Cable Testing Bandwidth Caps In Texas

Ars Technica reported yesterday about a memo from Time Warner Cable (that first showed up on a DSL Reports forum and has since been verified by Retuers) that indicated TWC might soon launch a trial program of bandwidth caps and tiered pricing, aka “Consumption Based Billing.” Ars Technica notes that the program might be TWC’s attempt to avoid using FCC-baiting traffic shaping or unpublicized “nebulous” caps to reduce bandwidth congestion—but of course it also gives the company an opportunity to charge high-volume users proportionally more. Sort of puts a damper on the whole future of downloadable movies, doesn’t it?

Under the proposed scheme, new customers will be able to choose from a couple of different plans with varying bandwidth caps. They’ll be given online tools to monitor usage and will be able to upgrade to the next higher tier of service to avoid charges for exceeding their monthly bandwidth limit. If the trial works well, Time Warner would then roll out bandwidth caps to current customers: “We will use the results of the trial to evaluate results for possible future nationwide rollouts,” reads the memo.

From Reuters:

The company believes the billing system will impact only heavy users, who account for around 5 percent of all customers but typically use more than half of the total network bandwidth, according to a company spokesman.

(Thanks to Mark and Zen!)

“Leaked memo: Time Warner Cable to trial hard bandwidth caps” [Ars Technica]

RELATED
“Time Warner to test Internet billing based on usage” [Reuters]
Original forum posting [DSL Reports]
(Photo: Beige Alert)

Comments

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  1. snoop-blog says:

    i will dump twc in a heartbeat if i have to pay more for the bandwith i have already.

  2. milty45654 says:

    Well, then as consumers we would expect much LOWER rates for those who don’t use 50% of the bandwidth(or 95% of us according to Time Warner)…you know it won’t be a fair 2 way street…corporate cronies suck..seriously how many god damn Mercedes do you need in your garage…asswipes.

  3. RvLeshrac says:

    Hooray, we get to pay EVEN MORE for what some countries have for free, and what most countries have in larger quantities.

  4. JustAGuy2 says:

    @RvLeshrac:

    Actually, bandwidth caps are pretty common worldwide – Canada has them, so does Australia, and many European countries.

  5. HRHKingFriday says:

    Haha, in Beaumont! All they’ll find there is a bunch of rednecks streaming porn. At least they’re not testing this in Austin, where half the population knows how to torrent.

  6. cobaltthorium says:

    It wouldn’t be like this if there were some competition in the market.

  7. try says:

    Hmm, why would cable TV companies try to interfere with potential competitors? That doesn’t make any sense at all.

  8. kerrington.steele says:

    how much use defines a “heavy user”? like, if you watch ten streaming Netflix movies a month? or if you do a lot of bittorrenting? or if you are hosting your own website or blog that gets any significant traffic? granted, I basically don’t know what bandwidth is or how you use it (the ‘puters … they scare me!). but it seems like TWC could just set the cap really low and charge everybody a lot of money for “heavy use”.

    basically, boo Time Warner.

  9. DallasDMD says:

    I agree with this if it results in lower-priced packages for light users becoming available.

    One of my biggest beefs with TW was only having two packages for which were both more than what I needed and wanted to pay for.

  10. rochec says:

    I’m in Texas and if they come close to trying to do this I’ll have no problems going to DSL or any other connection I can find.

  11. darkened says:

    Glad I’m on comcast again, I get my new 500gbx2 raid drives today (1TB raid 0). For a long time I’ve kept my usage below 200GB both ways a month, time for more like 500gb down, 100gb up again. =]

    My comcast has never had problems with usage, the very first 3 months I had comcast (way back when it was even excite@home) I used 1 terabyte upload only in those months, including a 3 week outage while I was on vacation.

  12. CurbRunner says:

    It’s certainly not unbelievable to consider that this is just the foot in the door with intentions of charging for even lower caps in the future.
    The definition of what constitutes a bandwidth cap will eventually shrink to apply to absorb most all customers’ usage patterns at a much lower threshold that what is being considered at this time. It’s all about getting more $$$$$$$$$$$$$$$$$$$$’s.

  13. warf0x0r says:

    Sort of puts a damper on the whole future of downloadable movies, doesn’t it?

    Yes it does.

  14. gorckat says:

    They’ll be given online tools to monitor usage and will be able to upgrade to the next higher tier of service to avoid charges for exceeding their monthly bandwidth limit.

    So theoretically the company could give a customer the tools they need to monitor usage and also report that info back to the company. Then:

    A) Automatically assign the correct plan based on that month’s usage
    B) Charge the customer out the wazoo for not upgrading when they went over

    B FTW!

  15. BoogerRed says:

    Thank God I have a choice here in the Fort Bragg area. If TWC caps my bandwidth in any way, shape, or form, I will immediately switch over to DSL. No questions asked.

    If you have a choice for broadband in your home, speak with your wallet. Switch!

  16. Murph1908 says:

    the billing system will impact only heavy users, who account for around 5 percent of all customers but typically use more than half of the total network bandwidth,

    Yeah. Right. See the next post about how much we trust these big companies. This is a perfect example. I believe not for one second that this will affect just 5% of the customers. Or, at least, this first iteration will affect just them, but they already have their 2008 strategic plan lined out to start here, but then slowly expand it.

  17. jeblis says:

    Time for some competition

  18. Rando says:

    Heavy user = Gamer and Netflix user

  19. bnb614 says:

    @randotheking:

    Heavy user = more and more people every year. Heavy user is a nebulous term.

    Followed the Alternative Minimum Tax (AMT) debate lately? When it was started, it was put in place to make 150 of the wealthiest people pay a certain amount of taxes. This year, until put on hold, was expected to impact 20 million taxpayers.

    Something tells me definition of heavy user will do the same thing. Each year snare more and more people.

  20. Geekybiker says:

    I think the real trick here is that such a pricing scheme will drive the high bandwidth people away without significantly reducing the price to the average person. They might not hit the cap, but they’ll be paying about the same for less service in theory. They can’t really afford to drop the average price. However this does offer up some new pricing options.

    1) Super low cap, but non-throttled connection for light users at a discount.
    2) High cap, unthrottled connection for people who want the fastest service regardless of price.

    Either way it gives the ISP incentive to offer the largest pipe possible to your house so you’ll use as much bandwidth as possible. Instead of the current model where they want to keep the data rate as low as they can to prevent bandwidth use.

  21. ShadowFalls says:

    I guess they forget about the less than familiar users who buy their Dells which are installed with crap that calls home often. People will turn their computer on, eat up their bandwidth and don’t know it.

    This is just another excuse for them to not spend their profits on upgrading their network to suit their users. Instead, they will draw in more profits by those who go over, and charge them ridiculous fees for that. They make this sound like it helps the consumer, the only one they are trying to help are themselves.

  22. privatejoker75 says:

    i download about 100gigs a month with time warner/roadrunner in austin. If they pull that shit with me i’ll cancel them in a second

  23. Ass_Cobra says:

    “Hooray, we get to pay EVEN MORE for what some countries have for free, and what most countries have in larger quantities.”

    Not that TWC will do this properly but in Denmark from Telia you can get a broadband connection that gives you 5GB/month for something at the equivalent of $10. Now I know most users would scoff at this level of usage but for a lot of people that aren’t heavy users it’s sufficient and is a reasonable compromise between being completely left off the internet and having a $60/mo. lampray on your side.

  24. theblackdog says:

    @JustAGuy2: You’re right, though I remember one person from Australia telling me that if they went over their bandwidth for the month, their provider would just cut their speed from the 5 mb they were getting down to 768k, or maybe even 384k, I don’t remember.

    I’d rather see a system like that than one that charges extra for going over.

  25. JustAGuy2 says:

    @privatejoker75:

    Honestly, and no offense, but overall, they’d probably prefer that you did cancel.

  26. MYarms says:

    I guess I’m going to have to cancel my internet and start stealing it from the neighbors.

  27. FLConsumer says:

    Looks like it’s time for some good ‘ol ethernet MAC spoofing.

  28. tulanejosh says:

    how can you see what your bandwidth usage is per month? I have no clue what i use. I know that i dont bit torrent and rarely watch movies via netflix. I do itunes, both music and some videos, online gaming on the ps3 and 360 (including downloading content), and Directv on Demand is internet based, so downloading from there is data usage for sure.

  29. TechnoDestructo says:

    @warf0x0r:

    Well, no, because you’ll be free to use Time Warner’s digital media services. And honestly, why would you want anything else?

  30. GearheadGeek says:

    To all the defiant types who’ll “switch to another provider in a second” if TW institutes ANY kind of cap (never mind if it’s 3x the max they’ve ever used, they’re not being reactionary without having details or anything like that…): You have to realize this broadband thing is an oligopoly… the 1 or 2 other choices you have will institute similar caps or tiered service if it works for TW, you’ll just be delaying the inevitable.

    Where I am now, I have 2 choices… 5mb Charter (that’s consistently been close to 5mb when I’ve tested at various times of the day) and 3mb DSL. They won’t even OFFER more than 3mb in my neighborhood, and since I don’t have a landline it would be a hassle to try them out.

    I’ve been happy with Charter service so far. Price and billing are not so great, but the service works and at least I can write off the broadband part of my bill because I work from home, which is why I went with the higher-bandwidth connection. The point is that there’s not REAL competition, and this sort of data transfer cap or tiered system will get around the ISP old-boy network QUICKLY if it works for them.

  31. TechnoDestructo says:

    @theblackdog: Wow. They can get 5mb?

  32. GearheadGeek says:

    @theblackdog: As someone who works from home via VPN, I would be LIVID if they cut my bandwidth by 90%. I’d much rather pay for what I’m using and get what I’m paying for.

  33. coan_net says:

    I would say this is a great idea – IF AND ONLY IF – they start to charge less for the users who use less bandwidth.

    I can see them charging a flat rate of $20 now – but with the new billing, still charge $20 but tack of additional charges for using more – which of course I would be pissed then.

    But if I don’t use much bandwidth – only to check mail and such…. I would be very happy to see a $3.50 bill for that usage.

    Bottom line – if Time Warner makes EXACTLY the same amount of money that it does now with the new pricing plan, then it would be how it should be – the people who use it the most pays the most – the people who don’t use it the most shouldn’t have to pay for bandwidth that the heavy users use.

    (then again I have a feeling that Time Warner is not going to do it this way and has their eyes on still charging a lot for the users who use little – which getting more from the heavy users…. but lets hope not.)

  34. edebaby says:

    I have WOWWAY (Wide Open West), and they have tiered pricing. Price depends on the download speed you want.

  35. GearheadGeek says:

    @edebaby: It’s pretty normal to tier the price on your maximum speed. They’re talking about a limit on period bandwidth use, PROBABLY a monthly cap of X megabytes. People are all up-in-arms about it before they’ve announced what X might be…

  36. deadlizard says:

    Gee. Looks like someone at AOL got a promotion to Time Warner Cable. What year do they think it is? 1993?

  37. jonworld says:

    Paying for bandwidth usage!!!??? The minute comcast does that I’m canceling my subscription. They already have crappy overpriced service on all of their products.

  38. BartClan says:

    Unfortunately, bandwidth caps do exist in the U.S. Those of us poor souls who live in Anchorage and its suburbs put up with bandwidth caps, or we can pay outrageous sums in order to have “unlimited” downloads. Personally, I’m on DSL [www.mtaonline.net], and I only have 10 gig/month. I really have to watch what the kids download so that I don’t pay overage fees.

  39. mongocrush says:

    I wonder if they will tell us what the cap is or just keep it a secrect until it’s time to charge us.

  40. chstwnd says:

    Isn’t this type of thing ominously similar to a contracted cell phone plan? and look how well those companies serve their customers! Imagine having Sprint- or Verizon-like contracts for the number of GB transferred in a month, and the nickel and dime fees for proportions of that devoted to continuous streaming (movies, internet radio, youtube, torrents), differentiation between protocols used, secure access (encryption utilizes more resources, donchaknow?), etc. etc……

  41. Keat says:

    Prices won’t go down for anyone. They will simply institute an “up to X GB” limit and charge the same price. Then they’ll have an added cost for bandwidth over the limit. It’ll be just like cellular pricing.

    So now, you’ll be able to get that HDTV PPV movie from TWC on-demand for $x or from Netflix for $y plus $z in bandwidth charges.

  42. theblackdog says:

    @GearheadGeek: Wouldn’t it be likely you would make sure that you had a plan that covered all your bandwidth so your speeds don’t get cut back? I would also assume that if you did get cut back that you could upgrade to the next tier of service.

  43. theblackdog says:

    @TechnoDestructo: That’s what I believe, but I haven’t asked them lately.

    Doesn’t Japan get some insanely high speed like 30 mbps?

  44. chstwnd says:

    @theblackdog: But the way companies typically implement this kind of thing is to take cut the level of service from their current plan and price it about the same as their current plan, with other “superior” services prices incrementally higher. therefore, to get the equivalent of what you already have, you must start paying a premium price. The only way that stuff like this works out best for the consumer is when there are multiple options for a service in a given area, and I think cable modems are pretty much localized monopolies (as are DSL services in my area). you get an either/or choice, and not a wide selection that guarantees competitive pricing.

  45. snoop-blog says:

    as much as i love the internet, i would just cancel and use the internet at work or free wi-fi spots.

  46. yoyomother says:

    @theblackdog: I live in Tokyo; I get up to 100mbps.

  47. HRHKINGFRIDAY said:

    “Haha, in Beaumont! All they’ll find there is a bunch of rednecks streaming porn. At least they’re not testing this in Austin, where half the population knows how to torrent.”

    I live in Beaumont and I don’t appreciate your comment.

    I think this idea stinks. I already pay nearly $60 per month for internet. How much more do they need to charge? This is stupid.

  48. synergy says:

    One local radio station was doing a call in about this subject this afternoon. People sounded pissed. I was glad I have long hated TWC and use a different, local company. heh

  49. RvLeshrac says:

    @JustAGuy2:

    They do, but they also have higher speeds than us available.

    I’m not paying a premium for going over my cap at crap speeds, especially when service is CHEAPER in those countries, to boot.

  50. RvLeshrac says:

    @theblackdog:

    100mbit in some places, ftw.

    10mbit across the country.

  51. Hello_Newman says:

    Well they have a point that the person who checks email and uses barely anything compared to the torrent king who winds out their connection all the time should pay different amounts. It’s a good idea in theory, but if they limit it too much just to screw everyone over that’s the same as a price increase.

  52. Zaos says:

    I will drop their digital phone, digital cable and my cable internet in a heartbeat if they do that in austin. There are plenty of legit people out here who actually pay to download a lot of stuff.

  53. elisa says:

    Just when internet content providers are pushing you to do high bandwidth activities, like stream movies…TW tries to pull this. I hope the trial fails miserably. Sadly, I have TWC, and there’s no good competition if I don’t want to get a landline (which I don’t b/c it’s way too expensive to have a landline and a cell phone).

  54. gerry8907 says:

    This is a forewarning for anyone considering selecting Time Warner (in Austin, TX) as your provider for Internet, cable and/or phone service. Their service is outrageously expensive…the highest rates in the entire state of TX – and their technical support is a joke. Be afraid – be very afraid! Stay away – stay far away!