Public rejects Time Warner metered-bandwidth tests Time Warner Cable is reportedly having trouble finding submissive test subjects for its proposed scheme of charging US customers by the gigabyte for their internet service. Additional trials for the company's new "consumption based billing" regime were slated to begin in several markets this summer, but public outcry has made …
It's important to remember that in many areas, cable carriers are essentially monopolists not only for television, but also internet connections. I recently tried to switch my in laws away from Cox Cable in North Las Vegas. Surprise, surprise! Even though they live only 100 yards from the largest switching station in that area of the county, Embarq (the local land line carrier) hasn't installed the necessary equipment for DSL (basically because North Las Vegas is poor and largely black and Mexican - of course Summerlin, Lake Las Vegas and the Strip don't suffer these limitations, but I digress). So, if Cox decides to pull this s**t, we're s**t-out-of-luck. Happily, Verizon is rolling out its 4G network this summer and will offer a 15 Mbs service for $75 a month, including hardware. We'll be switching.
As regards Time Warner's reasoning, it's patently obviously greed. With major Networks, both broadcast and cable, offering streamed content for FREE on the internet, it's clear that TW is worried about cannibalizing its cable offerings. After all, if they are so concerned with their precious bandwidth, why aren't they rationing cable tv? I only watch about an hour a day while the retired couple that lives next door watches seven to eight hours a day. Why aren't they charged more? Simple. There is no bandwidth problems, only sagging cable subscription sales problem. Shame on Time Warner and all other cable companies. My fervent hope is that wireless internet makes them all irrelevant!
Cablecos and telcos screwed the pooch by failing to deliver VOD and other IP-based services when they were the only game in town, citing "head-end" costs as being too great. But there was no "killer app" to drive customers to give up their dial-up service for the pricey cable and DSL offerings. (Remember when web pages didn't all have HD flash movies?) So they priced the high speed internet connections to get people to stop jamming their precious local loops with dedicated circuit calls for hours (telco) and cable did the same to try and remain competitive.
Now that everyone and their sister is streaming video and on-demand to boot, they have to do something to subsidize the cost of infrastructure upgrades that are needed to support to huge selection of freetard content available from the very content providers that they purchase entertainment from. Not to mention the successful business models from NetFlix and other VOD providers that are NOT telco or cableco based.
{SIGH!} We ARE eventually going to arrive at metered service. It's the only way that telcos and cablecos can recover the costs that will eventually have to be paid to boost service above the new "bottom" that 3G/4G wireless is forcing up on the wireline providers. However, the pricing needs to be rational: figure one HD-DVD per day for most customers, at the current rates for Pay-Per-View video, then customers will accept metered access.
Hell, my PARENTS, who are TWC customers, use over a gig per month, just wading through spam and downloading updates and applications for their computers! If 80-year-olds are going to hit the "poverty" limit each month, what about more Web 2.0 attuned customers? US$75 for 100GB is roughly 4 or 5 HD videos - like THAT is ever going to fly!
If the cablecos and telcos attempt to charge more for broadband but give their proprietary IP-based video services away as part of a "video" package, there will certainly be class-action suits against them for anti-trust violation.
So don't expect this to go away because some freetards have stopped it for now. But certainly don't expect this to end up costing and arm and a leg either.
(The Jolly Roger, because the real pirates are located in coms corporate boardrooms!)
I don't have a clue how much I use montly on average, so I don't know whether this would be better for me or not (although I suspect that, if the companies are suggesting it, it must be better for them). But it sure seems fair that whomever uses more, pays more. If it is like that with electricity, gas, water, etc., why not with bandwidth? I just suspect that the "plan" scheme might not be that great. Maybe it would be better to do like it's done with other utilities. Pay a base amount, like $15, which could include 1 GB or the like. Then charge a fixed amount per GB used.
$15.00 per gig? What do you think of five cents per Kilobyte? Thats right five cents per K, a whopping $50.00 per MB! That's what the big ISPs are charging for highspeed over their 3G networks here in Canada for data overage charges. The basic rate is $49.00 per month and that gets you 500MB of data transfer (not even a CD ROMs worth). The contract also states that you will be charged $1.00 per month to receive a paper invoice unless you sign up to receive an electronic invoice (better hope it's plaintext and not a PDF).
BOHICA
Apart from anything else, the proposed prices are a rip-off. Many broadband connections are effectively capped by AUPs (Acceptable Use Policies), both in North America and elsewhere. MY connection with Shaw here in Canada is effectively capped at 100GB (this number is actually given in the AUP) - for CAN$47.50. US$75 for 100GB is just ridiculous. Bandwidth isn't that expensive. There might be a lot less outrage if the pricing/bandwidth tradeoffs were reasonable.
Aw, poor little Time-Warner is having problems getting the suckers, err marks, um customers to accept their metered rip off service. "But we need that money so we can upgrade our lines when our lines are too full", they say. I say that's BS, what did ya do with the money the US government gave you? I know, spent it on hookers and blow. Doesn't mean anyone should care about your whinging. Or what about the nearly 4 BILLION dollars you received from your customers last year? Some how I doubt that your payroll and maintenance for the network is over 3 billion. I'm guessing that with a large city the yearly payroll/maintenance shouldn't be more than 3 million/year and that with smaller cities, the amount should be a lot smaller. With the smaller cities I'd think you'd be able to get by on 1 million or less. Why? Because I some how doubt that you have large call centers in each city you service. Also you probably don't have on average close to 20 cities per state where you have offices with these call centers. I know I'm trying to give what I think is a real guesstimate to what their costs are, but does anyone think I'm too far off?
The real point I'm making here is that they've made up some new plates to print money with and they're eager to use 'em.
"What happened as we're continuing to listen was we worked in some of the comments and ideas that got sent to us,"
And this guy works in communications? They should fire him and get someone who can actually speak English.
$15 for 1GB per month? And I thought we were getting a raw deal here in England.
$2 for extra Gig blocks? sounds very pricey to me. I'd use that in a couple of days, it's only one or two game demos.
Perhaps they want to take their customers back about 10 years and make the Internet un-affordable for anything other than looking at text and jpegs.
Also, it's not just the sudden hike in prices, a move like this (if everyone did it) would have massive effect on how the "free" internet can be used by people i.e. you and me.
When I worked for (well known database company) one of the consultants told me the following story about a bank in the US:
They did some data mining and customer profiling to identify who was "expensive", as in they complained a lot and had basic accounts that didn't make a lot of money, i.e. the cost more to serve than you were ever going to make from them.
As per the terms of service these customers were put into "special" accounts that reflected the real cost of serving them.
When they complained (surprise) they were given application forms for the bank's main competitor!
The other bank didn't understand what was going in until most of these customers had left and they had to increase the size of their call centre to deal with the load.
Call me cynical, but maybe if you can't make any money let people leave and make it your competitors' problem?
Maybe the reason for which this proposal is unpalatable is that for lots of users it raises the cost of internet access by a factor of two or more even if they *don't* exceed the cap? Who the hell would take an offer which basically states "here's the deal - you pay us three times as much as what you pay now, unless you exceed the cap, in which case you pay even more"? Srsly, up to 75$/month? And the 15$/month offer buys hardly enough to patch Windows and not enough to patch WoW? Was there even the need of a pilot? What reaction did they think they'd get?
So how does one know, for sure, what one has used?
For my gas and electricity there is a sealed meter I can keep an eye on.
For my phones I get an itemised bill (number, duration, etc).
For my internet?
- a full list of every URI, size and time accessed?
- or would they simply tot up all the bytes at their end?
- can I trust them to not fiddle the figures? At least the gas and leccy meters are in my house
- what is my own net monitoring disagrees with their figures?
- would there be "off peak" times like there are for many other thing?
Whilst I accept that heavy users cost more than the user with the occasional email, I think they are on to a loser here. That an their prices are WAY too high. At the moment I pay £10 for a circa 40gig limit - that puts their $15 (£10-ish) for 1gig into some perspective.
If net video threatens cable (can't see why it would, cable is a great way to push the intertubes) then they should be moving to embrace and exploit the potential new market; not through up defences to support a dying business model (like the record industry has).
If we believe the hype, we will all soon be on the cloud. We will be using content on our mobiles, netbooks, mp3 players, consoles, set-top-box, pcs, toaster(?); whichever is most convenient. We won't be watching the gogglebox, save for when it is the display device for the content. Hmm...yes, the internet will kill cable TV as we know it; but it will also create opportunities for those this the nouse to exploit them.
With the millions of dollars they're making off of people for this service, don't tell me they don't have the funds to expand their capacity.
The more people who use an ISP for internet, the more bandwidth they use, yes. But the more money the ISP makes as well. As long as they're making profits, they have the means to expand their capacity at any time as long as their profits scale with the number of users.
ISPs need to make a profit. Bandwidth costs money.
All you can eat schemes result in half of subscribers being subsidised by the other half, and of course the ones that are being subsidised whine when charging schemes which remove their subsidy are suggested.
The more accurately ISPs can pass the actual cost of provision on to the individual customer getting it the fairer and on average cheaper the service will be.
This Time Warner scheme seems dumb, data related costs are mostly from the cost of provisioning for peak bandwidth. Bytes in a pipe which would otherwise be empty are essentially free, bytes in a pipe at peak times determine the size and cost of the pipe and/or speed the customer gets. A scheme which doesn't take this into account is as flawed as 'all you can eat'.
Yep one of the nice perks in the states is getting our largely unlimited telecom and internet much cheaper than over in Euroland. I swear to this day Deutsch Telekom is just another arm of the government that exists to tax people for having the gall to communicate with each other. Euros are used to everything being rationed so they accept things like low data limits, paying for plastic bags at the market, expensive energy, small expensive flats with no yard, etc. On the other hand they don't accept some things Americans do like selling their souls and privacy to large corporations, living so far beyond their means they crash the world economy, and being so "puritan" that a pair of bare breats can never be shown on national tv (although Steven Segal snapping some guys arm and shooting another dude in the face is perfectly fine). Six of one, half a dozen of another I guess.
lets put that in perspective a little, based on a 4meg connection (as thats a nice round 500KB/sec)
in just over an hour of downloading you will hit your cap, or the equivalent of being able to use your connection for just over 2 mins a day. in February you can go nuts and have a few seconds more.
I cant really understand how anyone would believe metered pricing is a good idea. If TWC was looking out for the interest of the customers who don’t use much bandwidth then by all means offer a less expensive plan with bandwidth cap.
The crooks did some statistics and found 80% of their customers don’t use over 20 gigs a month so that must conclude a 20% profit increase. The reasoning is it will be “fair” to the other 20% who can pay for it because TWC will not afford to expand their network. The only fallback is assuming the 20% will keep TWC and not switch to Verizon FIOS, or AT&T what seems to be their strategy since all markets they are opening up the new plans are areas who do not offer FIOS.
How about this statistic A survey of 3,600 Internet users in eight countries showed that as many as 50 percent had downloaded copyrighted content in the last year. A majority of the content were movies. What doesn’t make any sense to me at all is TWC states that only 5 percent of their customers are using large amounts of bandwidth by downloading videos, yet TWC also state that the number is rapidly increasing over the next three years. If it’s increasing so rapidly why is TWC upsetting them by capping usage and risking losing what they themselves complain is a growing number of customers? It’s a step backwards.
Do they really believe these users will pay $1 a gig if they have another flat rate unlimited plan available in their area? Families with more than one computer sharing a network will naturally prefer the plan they don’t require to limit their teenager’s Gigabytes, especially since a unlimited plan with competitors is the same plan cost of 80% of their users. Its no brainer when someone offers me a online plan $50 for 20 Gigs with TWC or $50 for unlimited bandwidth with Verizon FIOS, which is reportedly faster . Even if I don’t normally go over the 20 Gig cap I still will go with the plan where I get more for my money.
When I first purchased TWC in 2004 I wondered if they would somehow penalize users who downloaded copyrighted material, it was around the time Verizon refused Supreme Court list of users downloading music and Governor Arnold was passing law requiring email addresses to be listed with P2P services. It taken some years for TWC to monopolize but now it seems my concerns back then were valid.
I don’t think its anything to worry about in areas where I live (Southern California). If they really wanted to put metered pricing plan to the test then do it in Los Angeles. Free Wi-Fi Cafes here offer better deal then what TWC is proposing. I predict by time they are done testing it in Texas the percentage of high bandwidth users will increase signifantly, the statistics will not be the same forcing TWC to give up the metered usage plan. Witch appears to be already the case in New York, Greensboro, South Carolina, and San Antonio and Austin, Texas and the 600 blogs I’ve read to responses of articles dating a year ago when they first announced the test in Beaumont Texas. I’ll really be surprise if it expands nationwide.
Frontier and TW have been duking it out for the Rochester, NY internet market for years. One increases speed, the other follows. One bundles phone, tv, internet, the other does. Unfortunately, neither of these providers offers FIOS, and Verizon does not seem to be planning to exapnd into the market. (Some people are theorizing TW Corporate only considered Verizon as competition and thought a medium market with only a local phone carrier would be an easy target.)
As a Frontier Internet customer, I sure hope TW looses enough to abandon the caps. If not, I see Frontier eventually following suit.
More info can be found a http://stopthecap.com.
They need to drop the stupid limits and overage charges. If you are going to have a metered service, then you have to make it X dollars for Y GB, period. This is just a stupid way to get "consumers" to guarantee their revenue by selecting a "tier", then giving them extra revenue if the customer goes over. This is fricken stupid.
This kind of crap shouldn't be allowed to happen. I keep seeing articles saying that the justification for this kind of billing system is that it will "save them bandwidth." That is the most frustratingly bogus piece of garbage statement I've ever heard.
Let's use a little bit of logic. Under the current system I pay X for Y amount of bandwidth with no file transfer limit. Now, assuming that the upload speed of in Y of server Z matchs my dowload speed in Y, I will use my entire available bandwidth. Under the new billing system I pay X for V amount of files transfers, but my bandwidth in Y remains the same as under the old billing system. Under the download senario I came up with, I still USE THE EXACT SAME AMOUNT OF BANDWIDTH under the new billing system, but I might pay extra if the file I download exceeds V.
This is irritating and unfair to the consumer. I'm almost ready to leave this country and move to a European country. There are NO CONSUMER RIGHTS in the US; only companies that will attempt to take the consumer for every penny they can and no regulations to stop them from doing it. Now, if you'll excuse me, I think I'm going to write a nice letter to the FCC about this.
"This ILLEGAL attemps from time warmer to start a extortion racket must be stop. As this will be view by other ISP as endorsement by goverment that ililegal bandwidth limitation will be tolerated."
Extortion? What, that they're demanding money from their customers or they won't supply the product? Last time I checked, it was still legal to make a terrible business decision...
You might want to put down the pipe containing whatever you're smoking.
Ok,
Time Warner is a company that plays in a bit of a monopolistic environment. But they exist to make money.
Since they already have a large and varied subscriber base, they have a couple of options.
First they need to do some data analysis to determine the average amount of usage by their customers. Then determine the frequency of which an average user occasionally goes over the monthly usage.
In theory, Time Warner could crunch the numbers and determine a price point and revenue targets.
Keeping the numbers simple, suppose that the average household used 10GB a month but occasionally goes over that limit 1 or 2 months a year by 2GB.
Suppose that the current 'unlimited' service costs $50.00.
Time Warner could raise that 'unlimited' service to $75.00 and then offer a metered bandwidth pricing where the customer pays $40.00 for 15 GB a month, or $35.00 for 10 GB a month. Under either plan, they get charged the $1.00/$2.00 a GB for going over their monthly quota respectively.
This way, a consumer who only uses 10GB a month can opt for the $35.00 plan and save $15.00 a month from their current bill.
Those who need a bit more based on their usage can get the $40.00 plan and again save money.
Those that want unlimited get charged the $75.00.
This will definitely get subscribers to move to the new plans without having to worry about 'volunteers' and pissing people off.
Note: The numbers are just here for example purposes. The point is that it would be fair for TimeWarner to take this type of approach because for the average consumer, they'll be saving money.
Kind of a simple solution that passes the PUC (Public Utility Commission) sniff test because it solves two problems. 1) Reducing the average customer's bills. 2) Allowing TimesWarner better control over their network.
FIOS is cool too, and you can bet that when it rolls out, over time there will be the same issue of bandwidth. The larger the pipe, the more content will flow and they'll have a similar problem.
What I am suggesting is a pricing model that allows them to shift from a single tiered pricing to a multi-tiered pricing.
The black helicopter because this type of modeling should optimize the revenue a company can generate while appearing to give the average consumer a break. Its a dirty little capitalistic sekret!
When I heard Time Warner was considering changing to metered Internet service, I thought that maybe I'd change to the phone company's fiber Internet service which is also available in my area. This would be a move of last resort, because when I moved into the area, the phone company told me they "would never" offer Internet service to our neighborhood.
I figured as long as I'm switching Internet service, I'd look at satellite TV, too, so I wrote to Dish Network asking if the dish could be installed in my attic instead of outside.
They gave me nothing but a form response: "Thank you for your interest; and here are some local Dish stores."
So I wrote BACK, saying, hey, you haven't answered my question. How's about answering the question.
Nothing.
As horrifying as Time Warner's metered service trial balloon seems, they historically have at least made good-faith attempts at responding to customer service inquiries, which makes them unique among comparable companies in the area.
So, they are still, in my book, the lesser of the available evils.
Most US consumers are lucky if they have even a broadband duopoly to chose from in the local marketplace. Some of us don't even have that. I have Verizon and they don't offer DSL or FIOS where I live and there MIGHT be cable, but it's TWC and I haven't been arsed to check them out since their (and MOST cablecos) reputation for service is nothing to write home about.
I doubt I will live long enough to see IP communications to the home for what I call true broadband (in the 50-100 Mb range) become a commodity item like electrical connections.
The biggest problem is that the providers who ARE in place aren't required to resell the "last mile" at competitive rates and are easily able to abuse their monopoly position. Most of the cablecos in the US are working in contracted monopoly situations anyway and have NEVER been held to the service level agreements that the telcos have (under state utility or federal commission rules, regulations and penalties. There is still a big question mark as to whether the cablecos are going to be "liable" for service penalties, etc. as they get into providing "telecommunications" instead of strict "cable" service. Buildout of competition has not been even been permitted based on the monopolies allowed under local and state laws.
This, of course, leads to lack of service, lack of care about lack of service, lack of decent pricing, lack of care about decent pricing....and on....and on.
Now there is additional competition to the cablecos and telcos for eyes on the interweb due to services which simply didn't exist 5 or 10 years ago and part of the way to "slow down or stop" that competition is to "regulate" the capacity that is available to the user so that the cableco / telco "stuff" is free and their "stuff" uses up your capacity and puts you in the "now you pay through the nose" rate schedule.
For the "free lunch" crowd, who are simultaneously lamenting the lack of competition (monopoly) in their area and the greedy carrier scumbags who want to raise their rates.... what, other than the prospect of making money, is going to incent another carrier to spend on infrastructure in order to run service to your area so you can HAVE some competition?
Hey,..."IT' IS ALL ABOUT THE MONEY", oh...and NOT delivering "just what you paid for , Ma'am".
And now they want more.
I contracted for UNLIMITED BROADBAND @ 7Mb/s,
and if they modify my contract, I and thousands of others
Will Be seeking a class-action Lawsuit, on breach-of-contract.
And speaking of 7 Mb/s, I just downloaded a "Important" update from windows,
and it took me half of an hour to download just 14.8 Mb.
More whining for money... WHAAAAAA
Also, with the Digital TV Deadline Past, but coming soon, no doubt TWC saw that most Americans will soon be getting most, if not all their viewing hours by way of one form or another of Broadband...
...Especially
SINCE OUR CITY COUNCIL MADE TWC/ formerly CABLEVISION "A MONOPOLY" IN THIS CITY!
Think that a DVD is about 2.5 - 3.5 Gigs.
That is what about 3 hours of watching.
Moms your kids watching just 3 hours a day, 5 days a week/ 4 weeks in a month. That is already 60 Gigs of service.
That is NOT INCLUDING ANY News, Weather, Internet ( yea, remember that one?),
or a weekend movie or two.
Let alone trying to find a job, look for work, or for anyone trying to run a small home office.
Of course, TWC points out that many of the people running Small Business out of their homes would/could benefit from having BUSINESS CLASS RR. Never mind that &1,000 cost.Ha,Ha,Ha!
And they were originally talking about a 5 Gig limit, + OVER USAGE FEES!
Do you really want them telling you how much TV you can watch, Economically speaking?
What Percentage of that bandwidth is TWC ADVERTISING, advertising the same service you are already using? Who could be watching this except subscribers,
Damn...And they just Waste more of my time.
They compress programing, add commercials, cut scenes from movies,
and have the guts to Throttle or Limit the Bandwidth to you,
even when you paid for a exact amount of bandwidth, "UNLIMITED"!!!
All the while hording the amount of time engaged in self-aggrandizement on
the same bandwidth that "YOU PAYED FOR". "UNLIMITED"!!!
Oh...and SHOWING YOU THE SAME DAMN COMMERCIAL OVER AND OVER AND OVER.
Obvious, It Is GREED, so...Take a look, Learn to recognize it.
Get a on-line speed monitor, and make sure that you get what you pay for.
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