A Glimpse Into The Future Of Broadband With Time Warner Cable
Time Warner Cable is running a pilot program in Texas where they're metering your bandwidth usage and charging extra if you exceed your monthly allotment. This also gives them the opportunity to create a tiered system where you pay more for more bandwidth. Richard is a TWC Texas customer, and his story is a good example of how things work in a tiered, metered system like this. The bottom line: if metered broadband comes to your area, get used to paying extra to take advantage of things like Hulu (which is free) or Netflix video streaming (which you already pay for).
I am a concerned consumer in the Golden Triangle region where Time Warner (The cable monopoly of Southeast TX) has decided to launch testing for overage charges on unrealistic caps made for their service.
Recently I have tried to stop relying on more costly services such as VOD so I have turned to NetFlix and Hulu which both have online viewing services. These changes soon put me over the 20 GB cap for my internet plan placed in our area. I am aware Comcast is taking a similar route but their limits are set substantially higher @ 250gb. I am not trying to do anything illegal here mind you. I am just trying to find cheaper alternatives to enjoy television. I was hit with a $10 charge ($1 per GB over) and this is what prompted a phone call to them and made me aware of this new billing process they are running only in my direct service area. I was told by a rep that streaming content like NetFlix creates a "bottleneck" type situation and makes other customers suffer. I find this hard to believe since other companies who do not use this method make out just fine. 20GB a month just seems far to low for someone who uses legal online resources like myself.
To Time Warner's credit I was credited back the $10 as a "one time courtesy" w/ the option of paying more ($10) for their Road Runner Turbo which has a 40gb cap which is still far from reasonable, or be discouraged from using my Netflix/Hulu. Additionally they gave me the signin to an online resource showing the amount of bandwidth coming from my modem each month.(their math also perplexes me in the attached picture). I am not upset with my speed as it is @ 7 MB/sec but to pay more just for more bandwidth seems ludicrous! As a matter of fact this practice could also discourage users from OTHER VOIP providers like Vonage. It seems TWC is trying to further discourage competition in an area where they are already a monopoly! If not then why didn't they start it in someplace where there are other cable providers for competition?
Since I have no alternatives to switch since I have no use for phone and Dry Loop DSL is not available in my area I am apparently over a barrell up a creek!
Richard
P.S. I have attached a picture showing you also how their tool shows a bit of strange math on how they calculated my overages! Mind you the calculater is my exact calculations which seems very simple math! (100 (for percent) divided by 20 (gb) times the 27.56(gb) i went over. Which should give me my percentage (137.8% not 147). If I am missing something please tell me!

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Comments:
Cox hasn't pulled that crap yet, thankfully. That does seem ridiculous, and even worse, it seems like bad math. But maybe I'm missing something as well. Stuff like this might encourage people to just say screw it and "borrow" wireless from their neighbor. Of course, plenty of people are doing that anyway without being screwed by TWC.
If you already got it, jump on the line with TWC and INSIST on grandfathering your account so they can't gouge you later on down the road.
When Sprint went and slapped a 5GB cap on EVDO broadband data card service, there was hell to pay! They got cooked past well done and lost a ton of customers.
But they compromised and grandfathered all accounts before the cap start date and mine is one of them.
This is just a move to stop people from using internet video services, and steer those people to use the video services offered by Time Warner itself. This will increase the usage of PPV and VOD, and they will now get far more additional revenue from their internet services.
This needs to be stopped, but, I have no idea where to begin, I don't want it to come to my area (NYC). But if this is 'successful' I bet it will.
@Nighthawke:
The problem with TWC, it is difficult or impossible to drop them, as they are a monopoly in many areas (and DSL is often not even close to the speed of cable). Since cellphone companies are essentially the same, people can vote with their dollar and switch, but not so much with the cable companies.
i really don't see what the big deal is. canadian internet companies have been charging customers like this since broadband was introduced. yes, it may mean you can't spend all day watching cookie monster sing "chocolate rain", but given the costs needed to maintain such a network with an ever-increasing number of participants using more and more bandwith, i'd say it's a very reasonable accomodation.
It is just a way for them to try and stop gap a flaw in their business model. If you can get TV of phone from the internet for free they lose out on the $100 a month people would've been paying. To make sure they still get yours they now found a way to bill you for circumventing their consumption model. This also makes users lock their networks because leeches now cost the consumer money directly.
It is a total scam.
How is it that ISPs are regressing to this type of billing? Does anyone remember the original system at AOL (AKA internet training wheels) where you paid for XXXX hours per month? I mean, this is stone-age stuff here...
The reality of this is TWC is trying to figure out a way around the Net-Neutrality thing if all ISPs are forced to treat traffic equally (as it should). If they can't make money by forcing you to use their "preferred" or "sponsored" sites, then they're just going to charge EVERYONE based on their bandwidth usage. Win-win for TWC. LOSE-LOSE for the consumers, as always.
@PirateCaptain_GitEmSteveDave:
I wonder if their own VOIP services would be metered? If they somehow put their services in a special tier, then maybe that would be a way to mount an attack against the metering, as they would be placing their own services in a preferred category, to the detriment of other services (i.e. vonage etc)
Thank God that in my area we have Fios. I have never seen Comcast beg until Verizon came and forced them to compete. For some this might be a good deal. I know a lot of people who just want to check their email quickly and if they get a good deal for not using a lot of bandwidth it is a good thing. It reminds me of the cell phone plans. Pay what you use.
Here's how their math works - their definition of gigabyte for your cap is 1 GB = 1000 MB = 1,000,000 KB, = 1,000,000,000 Bytes
However, your usage was measured using 1 GB = 1024 MB = 1048576 KB = 1073741824 Bytes
so, anyway, by their definition, you used up 27.56 GB * 1024^3 (GB / Btye) = 29592324669 Bytes. Then they subtracted your allowance of 20000000000 Bytes, and converted back using 1000^3 Bytes / GB to get an overage of 9.59 GB. It's the whole 1024 vs. 1000 issue that's shown up in all sorts of various memory rating areas (like why your 250 GB hd isn't really 250 GB)
If Time Warner EVER does this in my state, we're switching immediately. I spend all day going to websites, watching videos on youtube and hulu, and I frequently do web work where I'm constantly uploading and downloading large files. In this system my monthly bill would shoot up to over 300 dollars!
This is bullshit. Seriously.
If our local providers start pulling this nonsense we will be buying a T-1 and reselling it to our neighbors to help cover the cost.
Any business who is thinking of adopting a business model that caps bandwidth at a time where everything is moving towards high bandwidth content is more misguided than the RIAA.
How exactly does broadband work? I'd appreciate it if someone could pick up where my train of thought goes off the tracks here:
Electricity is metered because the provider has to give you more power, which costs them money. Is broadband a fixed cost? Obviously you have a line going to your house; at what point does this intersect with neighbours and how does paying for broadband overages improve the system? TWC isn't actually "creating" more broadband capacity on the line on a month-to-month basis, are they?
/ confusion
Point 1: (Business) It's been my opinion for some time that the cable companies will use bandwidth caps to "coax" you into viewing the cable company's content. The bandwidth caps will ensure that you stay subscribing to their core business - content providing. Look, they have already "coaxed" Richard into using cable TV over Hulu, and he doesn't even realize that he's doing exactly what they want!
Point 2: (Technical)
Also, I think their claim that Hulu et al create a "bottleneck" is a little bit iffy. There are two ways to transfer information on the internet: TCP and UDP. TCP is a protocol that 1) guarantees data delivery and 2) actively attempts to detect how congested the network is, and use a smaller slice if the network is more congested. UDP is a protocol that 1) Does not guarantee data delivery and 2) sends out data regardless of the status of the network.
A single UDP/TCP connection is not likely to bog down any network, even if it is a large file. The TCP connection will back off as appropriate, and the UDP 'connection' will just get it's data dropped by routers.
What really causes a bottleneck are torrents, because you have a whole crapload of connections blasting the pipe with small amounts of data.
I initially didn't ahve a problem with Comcast's plan for a 250gb limit because i figured that's big enough and no one should come close. I now feel differently because because once it is in place, and FCC doesn't have a problem then it'll be that much easier for comcast to reduce that 250gb to 100gb then to 25gb. with a cap limit and those limits bring in extra revenue, it will be even less likely that ISP's will want to upgrade their networks. why upgrade when you can make out like bandits from people overusing the limit on trivial online services.
I think I know how they got the %. I could be wrong, but they don't actully give you 20GB, but 20,000,000,000 Bytes. But you have 27.56 GBs.
20,000,000,000 Bytes = 18.62 GBs and 27.56/18.62 = 147.96%
I can't explain the GB overage # since that equals 8.93 GBs not 9.59GBs.
Should also be noted that 27.56GBs / 17.97 GBs (27.56 - the 9.59GBs that you are over by) is 153.37%.
Weird math they are using, but I would bet that they are giving you 20,000,000,000 Bytes and calling it 20GB
Along the lines of how they bill their own VOIP plan how do they address HD content on the TV, which chews up a ton of bandwidth. Seems to me that the guy watching HD content on the tube all day everyday would soar over the limits set on interweb traffic.
Seems to me that the preferential treatment given to their own content (voip and HD) could conflict with internet neutrality (for as long as this lasts).
@nataku83: You get the prize! I was going to post the same thing but you beat me to it by a long shot.
This is what's called shady math. You're actually over by 7.5GB, but they charge you for 9.59 rounded to 10! Ouch!
This reminds me of the whole ".05 cents per kilobyte" crap that Verizon/Sprint/AT&T STILL pull today.
Per GB charges just don't make sense. It's like buying salt at the grocery store in cubic meters. It just isn't sold that way. There are two ways ISPs buy their bandwidth:
- Flat rate. Generally, this means you buy a connection from Cogent, and you pay a flat charge for maximum speed of the pipe (eg: $10 per mbit). This is usually a great deal if you are an ISP and want to oversell (what ISP doesn't?)
- 95th percentile. Flows are measured over the month, and the ISP pays for the speed at the 95th percentile (eg: If the 95th percentile was 50 mbits, you pay for 50 mbits).
You notice nowhere they are charged per GB? Yup. That isn't how ISPs pay, and that's why this method of charging is fundamentally flawed. How?
It doesn't take into account time and peak usage. The length of time a transmission takes is directly proportional to its cost. A constant 128 kbits stream over a month costs an ISP more than a maximum speed 34 GB transfer, even though they are basically the same amount of traffic. This is because it raises the 95th percentile (by definition) and requires the ISP to purchase a 128 kbits larger pipe, whereas the burst transfer only requires the ISP to have bulk bandwidth available for you for that moment.
As far as peak usage goes a 1 GB transfer at 6 pm costs a residential ISP a *lot* more than a 1 GB, or even 100 GB transfer at 3 am. That's because your 1 GB transfer at 6 pm is pushing through an already overloaded pipe. If the ISP doesn't want to appear to have craptastic performance, they need to buy a bigger pipe, and it may raise the 95th percentile (if the ISP has already pegged the link, it won't). Whereas your middle-of-the-night transfer doesn't put a strain on the system because they haven't maxxed out their pipe and doesn't affect the 95th percentile because the traffic is still well below what it was during peak hours.
So, if you want to be fair, as an ISP, you can either charge a flat rate (because you buy bandwidth from a flat rate provider), you can charge for sustained transfer, or you can charge for peak hours.
It's hard to transfer the 95th percentile model to consumers, since you don't care about the consumer's pipe being saturated, you care about your Tier 1 link being saturated. But the absolute wrong way to do it is to charge a flat-fee per GB. That is absolutely backwards to the way ISPs pay for bandwidth.
As for apps, here's a short list of most suckage (for an ISP) to most awesomest.
- IPTV/videoconferencing/*tube (heavy constant stream, prime time, remote peer)
- Internet radio (constant stream, prime time, remote peer)
- Telephony (constant stream, prime time, remote and LOCAL peers)
- VPN (variable stream, prime time, remote peers)
- P2P (somewhat constant stream, not prime time, remote and LOCAL peers)
- FTP-alikes (bursty, not prime time, remote peers)
- Websites (bursty, prime time, remote peers)
- Gaming (low bandwidth/bursty, prime time, remote and local peers)
- IM (super low bandwidth bursty traffic, prime time, remote and local peers)
You want to kill an ISP that has idiotic per GB charges? Everyone tune into some HDTV internet content at 6 pm...
BTW: I <3 cogent. :)
"[..] to pay more just for more bandwidth seems ludicrous!"
Disclaimer: I'm not taking TWC's side here. I like my bandwidth unlimited.
However: It is by no means "ludicrous". TWC (and any ISP) have a certain dollar-cost for each byte they carry on their network. That cost is composed of a number of factors: Capital costs (more bandwidth and bytes-carried means more expensive routers/switches/etc), maintainence costs (more bandwidth and bytes delivery means more complex networks and more equipment), and upstream ISP costs (TWC connects to other ISPs to actually "get the internet" -- they probably have unlimited, fixed-cost bandwidth agreements, but more end-users using more bandwidth with higer data transfers = higher bandwidth and data to upstream ISPs = more $$).
So just like the electrical company, bandwidth (and total-bytes) is not free and unlimited for TWC.
That being said, a cap of 20gb is not a cap on bandwidth. It is a cap on usage. In the OPs example, 7mb/s is the bandwidth. 20gb is not a cap on bandwidth, but a cap on data transfer/mo.. I just want to clear that up. But both increased bandwidth and increased data transfer/mo. cost the provider more money.
To play devil's advocate, perhaps the increased use of services such as Hulu and Netflix streaming are putting a greater burden on ISPs and increasing their delivery costs beyond the revenue gained from their previously "unlimited" plans. They are not necessarily acting out of evil.
I would be in favor of a metered system provided that the ISP did a couple of things first.
1) Provided you with a tool to easily determine what your monthly usage was so you could self monitor and/or provided you with an automated E-mail when your projected monthly usage would exceen your cap.
2)Offered lower caps for significantly lower cost. Some people who simply check E-mail or stock prices may be fine with a 10G cap per month, and would be happy to limit their usage in exchange for a low monthly cost ($7-10/month). My parents for example would love a plan like this as they only use E-mail and a few web pages, and only got High speed because surfing the internet was becoming impossible with the increasing number of graphics and videos.
3) Offer high data caps (500-750G) at high data transfer speeds for a reasonable cost $40-50/month.
4) Offer a truly unlimited plan with no caps for significantly more (+$200/month), you are effectively leasing your port and portion of the bandwidth for your usage.
The pricing would be very similar to cell phone pricing where you chiise a service level based on the number of GB/month you anticipate using, but the caps have to be reasonable and the pricing has to be reasonable.
I have a "price lock guarantee" for TWC...hopefully this will prevent them from putting caps on my current service (5 mbps, unlimited) bc they can't charge me more than $40/month for internet. Although, I can see them saying that "overages" are outside the guarantee. If that's the case, I'm cancelling and not paying any ETF due to their terms change.
Its unfortunate that the cable companies have been put in such a position of dominance over their customers, in some cases being the only shop in town. The only way to stop this kind of crap is to yank your dollars from them, in the case where you have no competition to switch to this is a very tough pill to swallow.
I would imagine calls to your congress/senator/govenor may help?
Or as one person put here already this looks like an opportunity for a competitor to step in. Buy a acouple T1'2 or OC3's and sell your own service over wireless.
Thes companies will only do what they think they can do to make money and if that is threatened they will generally back off. Get the word out in your area with other options even some not quite as fast like tethered cell phone etc. Anything that you can think of and give solid example of how this will hurt them. Recommend that they call now and say that if it is turned on then they will pull their accounts end of discussion.
I will certainly yank my turbo/Full cable/digital phone from them immediately and I will make sure that they understand that now. I dont have a problem with a tiered system as long as the tiers are reasonable.
To the OP:
I'm in your area, and have FiOS. You should see when it's heading to your street.
This does sound a bit like a gouging scheme to me.
Usually, if you're capable of pulling 20+Gb a month in data, it's because you're already paying a premium for broadband.
If their reasoning about a bottleneck is true, what that really tells me about them is that they do not want to spend the money to upgrade their network to handle the additional capacity, so they are going to penalize you for using more than they feel is your fair share.
@lalaland13: Its probably just a Bit Byte conversion thing id do the math but im lazy
/me shrugs
Its kinda like when you buy a 320 gig HD but when you install it only shows 300 gig
@parkavery: Most cable broadband is a fixed-speed pipe shared between many houses. This way, by limiting your usage, there is more for the rest of the houses.
This is really just behavior modification. If they stop you from using Hulu, you will be using less bandwidth and more will be available to your neighbor. The right way to do it, IMHO, is to upgrade the lines. But we know that's not happening.
Also, this is not an issue with DSL because you have a dedicated line to the Central Office. I have AT&T Uverse for TV and Net, and I like it much better than Cable.
(Sorry if this doesn't show up right, my reply feature is horked for some insane reason)
@nataku83: Wow, the real shady thing here is they measure your bandwidth using one version of GB (the 1024^3 number), and set your cap using the other version of GB (the 1000^3 number). And they make no mention of the different uses.
Look, I think capped usage plans suck. I worked for a cable company that implemented one a few years back. That said, if you don't like it, get your internet from someone else. Just because you TWC is the BEST option doesn't mean it's the only option. You don't have a "right" to internet service nor do you have a right to unlimited usage on the service you might have. The companies have many different reasons for capping usage and charging overage fees, some of them truly profit motivated, some of them not. Switch to DSL, dial up, satellite, true wireless. But insisting that the government should step in and insist that TWC, et al provide unlimited data usage on their broadband plans is just absurd. While TWC may have a monopoly on cable internet service in your area, I assure you they don't have a monopoly on internet service as a whole.
Its just another example of people who don't believe in capitalism (i.e. Time Warner).
Here is what will happen:
1) They have an outdated business model.
2) They try to gouge people into remaining in their model.
3) They go to Congress and try to get a law passed to FORCE people into their model (i.e. get rid of net neutrality).
4) They go out of business instead of seeking to innovate, all the while paying their CEO millions.





















If you use VOIP, does that count against the usage count? Bad if you have a teenager with the phone attached to their ear.