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Cable Companies Reject Tiered Pricing Model

The Lynxpro submits this Investor's Business Daily article carried on Yahoo!, writing "It details how the Cable Companies are resisting a pricing this competition with DSL providers by resisting tiered pricing models. The article highlights how Time Warner Cable and Comcast are both bringing access speeds back to 3Mbps without any price increases. What the article fails to mention is that is the very speed rate @Home offered before going into bankruptcy. The cable companies formerly partnered with @Home reduced access speeds when they resumed their own services in the wake of the @Home implosion." I wonder if (low-speed) Internet access will ever be just another basic-cable feature.

24 of 300 comments (clear)

  1. Basic Internet w/cable? by Renraku · · Score: 4, Interesting

    That's a pretty good idea.

    Make basic cable come with a username/password and leave support at that. No tech support, no customer service, just a low speed (100k down, 30k up or something) thing for users of whatever cable service. If you want tech/CS/more speed, you'll pay the premium!

    --
    Job? I don't have time to get a job! Who will sit around and bitch about being broke and unemployed then?
    1. Re:Basic Internet w/cable? by YrWrstNtmr · · Score: 3, Insightful

      Make basic cable come with a username/password and leave support at that. No tech support, no customer service, just a low speed (100k down, 30k up or something) thing for users of whatever cable service. If you want tech/CS/more speed, you'll pay the premium!

      The very people who would use that are most in need of support, etc.

      Installation, configuration, "how do I". Maybe once PC's become as easy to use as a TV will that work. Maybe.

  2. @Home was slower by rruvin · · Score: 3, Interesting
    I'm in Canada and had Rogers@Home before @Home folded and Rogers took over running its portion of the network.

    The speed was never 3 mbps; it was 1.5 at best.

    These days, of course, while the advertised speed is still 1.5, I'm lucky to get 800 kbps. Repeated phone calls to Rogers have resulted in absolutely no action, and I'm considering switching to DSL.

  3. Re:3mbps is still better by wobblie · · Score: 3, Informative

    Cable modems can go 10Mb/sec upstream and downstream. The capping is artificial, but does reflect real concerns about bandwidth management on a large shared network - obviously they can't give everyone 10Mb up and down.

    Typically, though a T1 is more reliable than HFC.

  4. Let's take a step back... by moehoward · · Score: 3, Insightful

    I've been using alternative providers in the past 5 years. What is cable like these days in terms of services? Are you allowed to host at all? Do they offer a tier for business users who want to host or is hosting or running anything on any port just plain disallowed?

    I guess I'd like to compare apples to apples when comparing to DSL or broadband wireless.

    What are outages like? How often? How long do they last? What's the "real" upload speed vs. download speed? How are ping times to common sites as compared to other types of services?

    I think we can use a quick discussion of these topics just so we're all on the same page.

    I left the cable world because of many/all of these issues. I still see people struggling with them. What's it really like with cable, though? Do I just have a few bad experiences?

    --
    "If you want to improve, be content to be thought foolish and stupid." - Epictetus
  5. Nice non-sequitur by Distan · · Score: 5, Funny

    Didja notice at the end of the article:

    The Recording Industry Association of America (news - web sites) has asked broadband service providers to crack down on subscribers that illegally share music over the Internet.

    Other than the tenuous link to upload speeds, that had nothing to do with the rest of the news story. It may just as well ended with:

    Many broadband subscribers use their connection to view pornography. The Pope, who once watched cable television, is opposed to pornography.

  6. Competition by BWJones · · Score: 4, Insightful

    Hrmmm. I really like the idea of basic cable coming with internet access. This sort of thing was what deregulation was supposed to be about. More products for cheaper given the open competition. Rather what has happened ever since cable deregulation has been a steady increase in the price of cable (from $9.00 to almost $50.00). And while the number of channels has increased, I am still getting the same channels I always watched, but my cable company has bundled in lots of shopping channels I don't want and I don't want to pay for. How difficult is it to simply give me the products I want to pay for? Give me 1) Broadband internet access 2) the History channel 3) the Learning channel 4) Discovery 5) CNN's 6)CSPAN 7)FoodTV 8) Speedvision 9) ESPN and perhaps a few others. The rest is just noise that I don't want to pay for and never watch.

    So, at most 15 channels plus broadband should run what $25-30? They can have the other 70 channels.

    --
    Visit Jonesblog and say hello.
    1. Re:Competition by guacamolefoo · · Score: 5, Informative

      How difficult is it to simply give me the products I want to pay for? Give me 1) Broadband internet access 2) the History channel 3) the Learning channel 4) Discovery 5) CNN's 6)CSPAN 7)FoodTV 8) Speedvision 9) ESPN and perhaps a few others. The rest is just noise that I don't want to pay for and never watch.

      So, at most 15 channels plus broadband should run what $25-30? They can have the other 70 channels.


      Something that you may not be aware of is that many channels are part of package deals with cable companies. If you want CNN, you have to carry TBS. If you want ESPN, you have to carry ESPN2, ABC's family channel thingy, etc.

      Also, the prices charged for individual channels, such as ESPN, are quite high per cable subscriber. You aren't just paying for access to cable -- you are paying for the content as well even if you are just getting basic (since this usually is more than just local channels and shopping channels). Other than the local channels (which must be carried) and the shopping channels (which pay your cable company to be on their system), each channel has a cost to the system that carries it. Not surprisingly, ESPN and CNN are among the most-expensive cable channels because everyone wants them. Throw in the package deals and the cost of the cable plant, and the "basic" cable cost soon gets fairly high.

      Your cable bill can be viewed as several separate and discrete components: cost recovery for the cable plant, overhead (ads, customer services, truck rolls, etc.), profit margin, content costs, and premium content costs (which are recovered by higher charges for premium packages). Municipalities also get money from the deals that they cut from the cable companies to provide service in your area (franchise feess/taxes).

      If you want internet access or better basic cable options, a good idea is to mobilize people significantly in advance of the time that a franchise agreement for your municipality is about to expire. Let your local elected officials know what you think is important and organize a group of people so it's not just one person nagging. More often than you might suspect, the local board in charge of such things will consider your input.

      The local chamber of commerce is a good place to start rallying the troops as well -- many local chambers are in favor of the idea of expanding broadband access, as it helps businesses as well as consumers. They might be willing to agitate with you or at least at the same time as you. If a local board sees people coming out of the woodwork on an issue, they are less likely to rubber stamp whatever is dumped into their laps by the cable company.

      Someone with a better knowledge of the cable industry can fill in the details on component costs better than I can, but this is my general understanding of how things work with cable price policies.

      GF.

  7. Frustrating... by Short+Circuit · · Score: 4, Insightful

    As someone who doesn't have or want cable for television, I find it constantly frustrating that internet access is being bundled with it, and can't be had without at least "basic cable"

    For the record, our TV hooks up to our DVD player and VCR. Just starting on season 6 of STTNG this week. Hope to get DS9 soon.

  8. Re:3mbps is still better by titzandkunt · · Score: 3, Funny


    Try saturating your 512k 24*7*52, and see how long it lasts.

    You rent a T1, you got 1.5MBPS up and down until the cows come home or you get bored. And cows aren't noted conversationalists, mark you.

    T&K.

    --
    Political language ... is designed to make lies sound truthful and murder respectable...
  9. Bandwidth has NEVER been cheaper by Bodysurf · · Score: 4, Informative

    "What the article fails to mention is that is the very speed rate @Home offered before going into bankruptcy. "

    That was years ago. Bandwidth has gotten a hell of a lot cheaper, dirt cheap. In fact, pumping photons around the Internet has never been cheaper. Pesos on the dollar to what it used to be.

    DSL is kicking cable's butt, and this is what cable had to do to be competitive. No big surprise here.

  10. Negativism by Reckless+Visionary · · Score: 4, Insightful

    Congratulations, you found a way to complain about the fact that Comcast is increasing bandwidth at no extra cost. Anyone here think that's a little negative? What happened to the headline "Comcast Reverses Reduction in Bandwidth"? I'm not some pro-big-business-fuck-the-hackers economist or anything, but isn't that a "good thing"? Competition leading to better service at the same price?

    --
    I think I'll stop here.
  11. Back in the day.... by macshune · · Score: 4, Interesting

    Right when cable came to my neighborhood about 4 year ago, there wasn't an upstream cap (or a tv cable block, either:). No one else on my node had @home, so it was the de-facto way to send & receive files between my roommates computers (why we just didn't use the local network is beyond me).

    Later on when I worked for @Home/AT&T Broadband, I almost got my access shut off because I'd uploaded 3 gigs of mp3s to my girlfriend's iMac. But since I worked there, they let it slide.

    I think the fastest connection we ever observed installing those modems was 8mbps.

  12. You'll have better luck... by justMichael · · Score: 4, Informative

    If you look for those answers on Broadband Reports

  13. Re:3mbps is still better by wfberg · · Score: 4, Interesting

    Cable modems can go 10Mb/sec upstream and downstream. The capping is artificial, but does reflect real concerns about bandwidth management on a large shared network - obviously they can't give everyone 10Mb up and down.

    Actually, the rate for downstream is more in the general area of 54Mbps per television channel sacrificed for internettraffic. Unfortunately the upstream is more limited; the cable networks were designed to broadcast, and even when they did conceive interactivity, the amount of bandwidth (in terms of Mhz ranges) set aside for the return-channel was rather limited; and there's obviously a limit to how many times you can 'split up' a neighborhood in 'subnets' that have a separate head-end each.

    The whole 'cable is shared bandwidth' is somewhat of a thing of the past given that pretty much every one is using (euro)DOCSIS these days, which actually does TDMA - but the availability of upstream bandwidth can still be a bottleneck.

    --
    SCO employee? Check out the bounty
  14. Double edged sword for cable operators by ctwxman · · Score: 3, Insightful

    The cable operators face a really difficult choice as far as speed and bandwidth is concerned. Remember, high speed access is only one of the products hey sell. They are also making significant income from pay-per-view and premium channels.

    With higher speed access, some program originators might decide to cut out the cable operators entirely. For instance, my wife and I subscribe to MLB's Philadelphia Phillies broadcast over the Internet. This year, MLB added video, with surprisingly good quality.

    But, with this MLB package, my cable company, as the carrier, gets nothing. If this were a pay-per-view event, they'd be a profit participant. And, who's to say some movie channel or sports channel or any kind of broadcaster or cablecaster might find it more economically viable to cut of the cable middleman and do the same thing?

    This is one reason I worry about cable and telcos as the primary high speed gatekeepers. Telcos have their own issues with VOIP.

    It will be interesting to see this all play out. Will cable companies see it in their best interest to give us this broad pipe only to watch us cut their throats with it?

  15. Really fast ;-) by leighklotz · · Score: 5, Funny

    Last weekend I got a call from Comcast offering me Cable Internet service for an introductory rate of $21.95/mo. I asked how fast and the telecaller said, "Six hundred and thirty five gigabytes." I said, "Per month? Per hour? Per second?" She said, "Per second, sir."

    I asked, "Can I run servers?"
    She said, "Yes sir!"
    I said, "On port 80 and port 25?"
    She said, "On all ports, sir."

    I said, "Before I sign up I'd like to speak to your supervisor to confirm this great deal."

    Sadly, the deal evaporated when I got to speak the the sympathiser, but she was interested in what I wanted. I told her I had 1Mb/1Mb symmetric access and static 8 IP addresses, and she asked what they could do to get me to move to Comcast Cable Internet service. I suggested perhaps symmetric service 1.5Mb/1.5Mb would be nice, or perhaps 3Mb down and a portable Class C netblock to do multi-homing with my current 1Mb SDSL uplink. She wrote it all down and said she'd pass my request along.

    I'm still smarting at the lose of the 635GB/sec downlink for $21.95/mo though!

  16. Impending Broadband Slowdown? by Mr.+Ophidian+Jones · · Score: 4, Interesting

    Better would be to focus on the slowdown of American broadband. When it was first rolled out there were no caps whatsoever and it was generally allowed to run at the speed that the equipment could handle. So the average DSL user ran over 3mbit in some cases if they had good lines. Uncapped both directions.

    Then came the abusers and greed of the communications companies and today you see the extreme chokehold on the broadband today. SBC's base package for DSL is 384/128k dn/up compared to Verizon's 768k-1.544M/128k and the cable companies provide service comparable to Verizon.

    New trends are starting to take hold in some areas with Verizon Wireless rolling out EvDO 3G which can run upwards of 2.3M and Verizon Landline (Seperate companies) is testing 2M+ speeds in certain (Lucky) markets with future plans to turn up the dial on broadband.

    While those trends are nice to see you still have many who still have dialup due to cost and some worse off areas still cannot get a better connection than 26600kbps!

    Interestingly people have pointed out monopolies. There is basically 1 telepone company in South Korea. Korean Telecom and a handfull of offshots after other companies were allowed to spring up but I'd say 90% of that country is serviced by KT and TMK there is only one cable company there. So it's questionable if more competition really is the answer (Korea may regulate, the us de-regulates)

    I'm not sure what goes on in Japan but I would suspect nearly the same situation there also but you'll have to understand both countries until very recently had complete conglomerates (Sp?) of many things from electronics to communications systems. Now there is free market competition but not in the manner of how the US Govt mandated AT&T split up those companies were just forced to allow competition to "try" to work their way into a established system. Which probably will work becuase the exec's of those companies realize given choice people will pick the better company that provides them value.

  17. Re:Prices... by scovetta · · Score: 4, Funny

    I noticed that too, sorry, I'm normally hungrier at this hour, and my stapler is broken.

    --
    Wer mit Ungeheuern kämpft, mag zusehn, dass er nicht dabei zum Ungeheuer wird. --Nietzsche
  18. Re:3mbps is still better by BasharTeg · · Score: 3, Informative

    channel rates
    channel BW 16 QAM 64 QAM 256 QAM
    6 MHz (US) 20.9 31.3 41.7
    7 MHz 24.3 36.5 48.7
    8 MHz (Europe) 27.8 41.7 55.6

    user data rates
    channel BW 16 QAM 64 QAM 256 QAM
    6 MHz 19.2 28.8 38.5
    7 MHz 22.4 33.7 44.9
    8 MHz 25.6 38.5 51.3

    Threshold C/N (dB, 10-8 BER)
    QAM
    16 18.8
    64 25.5
    256 31.7

    Motorola CyberSURFR cable modem: 30 Mb/s (shared) downstream in the 65 to 750 MHz band, 768 kb/s (shared), 680 kb/s effective upstream in the 6 to 42 MHz band

    http://www.mot.com/MIMS/Multimedia/whitepapers/c ab lecomm_wpaper.pdf

  19. Bandwidth is more expensive by scoove · · Score: 3, Insightful

    Bandwidth has gotten a hell of a lot cheaper, dirt cheap. In fact, pumping photons around the Internet has never been cheaper.

    Says who? Sprint, UUNET, etc. have all jacked prices. Typical is 10% across the board each year in the past - on top of "old" pricing. Deals for highly discounted wholesale bandwidth are no where as competitive as the peak of dot-com - why? There simply isn't the competition anymore (and not enough people giving it away to make up for a little bit of cost).

    DSL is kicking cable's butt, and this is what cable had to do to be competitive.

    Actually, cable's doing this but for a different reason. Cable operators have generally failed to implement layer two over layer two/three protocols that allow them to rate shape customers effectively. Yes, they do have controls but overall they're pretty raw compared to mechanisms like PPPoE that is more common in DSL land.

    The solution for the cable provides is to solve this by overengineering and using brute force. That's why you'll see 3 Mbps/1 Mbps type profiles, but at 9pm, it takes 25 minutes to download a 5 MByte file or dslreports shows you're running 108kbps down, 72kbps up.

    Likewise, you'll find lots of the cable operators in smaller markets abusing their aggregate to the extreme. Yes, it's 3Mbps local, but a single T1 for all to share leaving town.

    Just don't forget, bandwidth is no different than crude oil - it's very supply/demand driven, and right now, those who've survived to be here today in telecom just won't sell cheap anymore.

    *scoove*

  20. Re:3mbps is still better by pyrrhonist · · Score: 3, Interesting
    Cable modems can go 10Mb/sec upstream and downstream.

    Cable modems generally have different selections of modulations and frequencies
    that enable many datarates higher than 10Mbps downstream.

    For instance, my Linksys BEFCMU10 has the following specs:

    • Upstream datarate: 320Kbps (QPSK) to 10Mbps (16QAM)
    • Downstream datarate: 30Mbps (64QAM) to 43Mbps (256QAM)
    So the problem isn't the modem, but whatever the head end is using, and environmental factors.
    --
    Show me on the doll where his noodly appendage touched you.
  21. Re:3mbps is still better by GlassUser · · Score: 3, Interesting

    What do you mean? I'd kill to have 384/128 access for an additional $10 a month on my phone or cable bill. I'm sure plenty of other people would too. All I want is a persistent connection that I can share with people in the house that will let me send/rec email and small files quickly on occasion, and maintain a small personal web page. As long as I don't have to wait for it to dial in (this includes PPPoE garbage too), and it's pretty much always there, I'm in.

  22. Charter Communications by _aa_ · · Score: 3, Interesting

    I live in (or around) St. Louis, MO, USA. My area is blessed with the presence of Charter Communications. They are a cable company that does offer tier based pricing.

    Service plans (select one)
    384 K $29.99/month
    2 M $39.99/month

    There's actually a 3rd tier in the middle they don't tell you about on their website. I'm not certain what the specifics are on it. But the tiers are listed as; Bronze (Maximum-crap), Silver (Marginal-crap), and Gold (Minimal-crap).

    Here's what they don't tell you: All upstreams, on all tiers are capped at 150 kilo-bit per second. Regardless of the tier you're paying for, you cannot buy more upstream. This has annoyed me for years. Oh how I long for the days of @home. I am curious why the upstreams are capped as they are. I don't understand why the upstreams are limited as they are. I think that it might be to curb child pornographers and data pir8s, but those activities are illegal. It's not up to my cable provider to thwart such activity.

    It makes me wonder what they're doing with all that extra bandwidth. Their mail servers likely take in significantly more than they put out. Their web servers likely don't consume a relativly large amount of bandwidth. They must have a massive surplus of upstream that they're paying for anyway.