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Time Warner Expanding Internet Transfer Caps To New Markets
Akido37 writes "Time Warner Cable is expanding its transfer capping program to new markets in Rochester, NY, Austin, TX, San Antonio, TX, and Greensboro, NC. It seems they have been testing plans with 5, 10, 20, or 40GB of data transfer per month, with prices ranging from $30 to $55 a month. BusinessWeek quotes Time Warner Cable CEO Glenn Britt saying, 'We need a viable model to be able to support the infrastructure of the broadband business ... We made a mistake early on by not defining our business based on the consumption dimension.' Ars Technica adds, 'The BusinessWeek article notes that only 14 percent of users in TWC's trial city of Beaumont, Texas even exceeded their caps at all. My own recent conversations with other major ISPs suggest that the average broadband user only pulls down 2-6GB of data per month as it is. One the one hand, this suggests that caps don't really bother most people; on the other, it indicates that low cap levels aren't needed to keep traffic 'reasonable' since it's actually quite low to begin with.'"
Time Warner has an interest in keeping media businesses under control, therefore it cannot allow streaming services to gain traction. Video streaming in HDTV quality will easily reach these limits, but almost no other internet usage will.
I only wonder why they are expanding the test to larger markets where they don't have significant competition from other ISPs
That's the whole point. Here in Rochester, NY, we have no other option but DSL. In Buffalo, NY (about an hour away), they have Verizon FiOS.
We are getting screwed, they are not. We have no other option for broadband, and they do.
This is so clearly Bait & Switch that TW should be proscuted within an inch of their corporate lives. Their top officers should be in jail, to wit:
1: Promise unrealistic, unlimited downloads and speeds that discourage all competition.
2: Once you have the monopoly and the consumer has nowhere else to go, bring in onerous download caps that actually reflect the basic capabilities of your pitiful system.
3: Buy off Washington so that you won't be punished for #1 and #2.
4: PROFIT!
The really Big Lie in all of this is that the argument for caps is that the system only has a very limited capability. Yet WITHOUT CHANGING OUT A SINGLE PIECE OF HARDWARE you can get a much higher cap simply by paying a much higher amount of money. Where did all that extra bandwidth come from? Clearly cable companies lie like rugs, and the public and regulatory agencies continue to buy into those lies as we're all being screwed over!
"It's the height of ridiculousness to say for those 9 lines you get hundreds of millions."
Maybe this is redundant but I think it needs to be said.
If you're on Time Warner, call and complain. Tell them that as a result of this new policy you are researching alternatives and as soon as you find one you will be canceling service. Let them know that you will be telling you family and friends who are less technically minded to start looking for alternatives too. Remind them that even if their profits on heavy users are slimmer, it is those same users who the rest of their customers go to for advice.
Then follow through, and make sure that everyone you get to switch tells the operator that "A friend who is very knowledgeable recently canceled your service because... and recommended I do the same."
"stuff like iPlayer" is exactly what they are afraid of. This isn't so much about bandwidth costs, though that is somewhat important, as it is about protecting their legacy video model.
How about digital delivery? Steam, XBox Live Marketplace, and PSN? You can legally download original XBox and PS1 games through those networks, and plenty of games through Steam can top 5 GB by themselves.
Someone could think it is the exact opposite, as in you're not using what you paid for. But I don't think either is true. In reality, you chose to pay for a connection that had a certain capacity even though you knew you didn't need it. But you thought it was a fair deal, the seller thought it was a fair deal, you both agreed, you're both happy. The GP went to the same seller, thought it was a good deal, the seller thought it was a good deal, both agreed, and both are happy.
I don't get angry because someone else spends longer at the gym than I do, even though we're both spending the same monthly amount. If I really thought it was unfair, I could spend more time there, or ask to pay less, or go somewhere else where they limit the time you can spend in a gym.
Stop Global Warming!
Just say no to irreversible processes!
But what about next week?
ustr: Managed string API with ave. 44% overhead over strdup(), for 0-20B
Here in San Diego, I have one of their RoadRunner packages. I get up to 8Mbps (and often the full 8Mbps), but I see it's also common to have up to 50Mbps. On a 5Mbps line you can download about 50GB in 24 hours. On an 8Mbps line just over 80GB. TW reps have announced a 100GB "super-tier" via Twitter. Even so, you can exhaust that in under 2 days at only 5Mbps.
Sounds like a lot of bandwidth? 720p H.264 will run 5-6Mbps for decent quality (my opinion). If you watch 24 hours of it you'll blow through their 40GB plan in around 19 hours of viewing (based on 5Mbps avg for the video). 1080p? Let's call it 8Mbps average for the video bitrate (favorable for the ISP in my opinion) and you'll exceed your $55 plan (according to the summary) after watching only 12 hours worth of content.
Tier based pricing such as this will kill innovative new services. If this becomes commonplace I doubt you'll see some of the video sites emerging today serving a lot of HD. We're even less likely to see online music stores adopting lossless formats. Because end users will only be able to download a limited amount per month there will be less pressure to lower bandwidth prices for backbone/CDN - "demand" (and I use that term loosely in this context) will outstrip supply.
I see it like this: Thanks to things like YouTube HD, Hulu, Netflix online, Veoh, and so forth, we're *all* downloading more, no matter what the ISPs try to tell us "the majority of their customers" use. Their margins will be getting squeezed. You aren't benefiting from this new tiered model because "you aren't subsidizing high use users" - you're going to be paying about the same, if not more, and your plan will give you less downloads and greater risk (if you exceed it).
I also cannot help but wonder for ISPs that are linked to media giants whether there is some line of thinking that says "We're bleeding due to piracy, people are dropping their cable packages, motions against BitTorrent haven't worked, let's find another way to stem the bleeding". If this were a factor it would be putting self protectionism against national infrastructure interests.
Anyway - the main thing to keep in mind is that this is not just an issue for your net access and wallet today, it will limit the kind of services and media that are developed tomorrow.
With the exception of water, all of those other things you mention have very real marginal costs. The more you use, the more the company has to spend. Electricity costs the company proportionally because they have to use more fuel to produce it. With gas, after you exceed a certain amount, somebody has to go out and drill another oil well to capture more. Similarly, with water, if you exceed the natural capacity of the aquifer, the wells eventually dry up and you have to spend money to drill new ones and/or truck in water until the aquifer replenishes itself. Garbage service costs more because you have to hire more people to work more hours if people use it more heavily. There are very real, tangible marginal costs involved with all of those things.
Internet bandwidth is not like that at all. Initial infrastructure costs notwithstanding, the cost of moving a terabyte of data is approximately the same as the cost of moving a gigabyte. Adding lines to increase capacity costs money, but within the limits of the available bandwidth, the wires have to still be maintained and equipment periodically replaced whether you transfer a terabyte or a byte.
Also, all of the things you mention can be conserved and used later. By not using water, you are increasing the levels in the aquifer (to a point) that can be used later when you have a dry spell. By not using electricity, you are causing generators to be taken offline, saving fuel that can be used to produce power later. By not using as much gas, you are leaving gas in an oil field that can be retrieved later or stored in tanks for future consumption. Internet bandwidth, however, cannot be conserved. Once a second has passed, the gigabit you could have transferred in that time was either transferred or it wasn't. If it wasn't, you can't transfer two gigabits in the next second to make up for it.
The marginal cost of providing Internet bandwidth is zero, so the marginal cost to customers should also be zero. Customers should pay for the infrastructure costs amortized over the life of the hardware plus some percentage for profits. Any other scheme is a scam.
The problem is that these companies have lied to consumers for years saying that they can provide X Mbps (for some value of X) to customers in hopes that they would never really use that much, knowing full well that they were massively overselling their capacity to turn a substantial profit. Now, as customers start to do more with that bandwidth, instead of turning around those huge profits to expand the infrastructure, they are looking desperately for ways to continue to turn huge profits without actually improving the infrastructure. After all, it's not enough to break even. They have to make more profit than the year before to add value for their shareholders. At some point, such an economic model breaks down and they have to pay the piper. I think we're to that point, and no amount of tiered bandwidth is going to fix that. If they continue down this path instead of spending the money they need to spend to improve their infrastructure, they will soon be supplanted by disruptive technologies. Maybe that's good, but it certainly won't be good for companies like Time Warner.
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