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ISP Capping Is Becoming the New DRM

Posted by timothy on from the upgrades-to-first-class dept.

Crazzaper writes "There's a lot of controversy over ISP capping with Time Warner leading the charge. Tom's Hardware has an interesting article about how capping is the new form of DRM at the ISP level. The author draws some comparison to business practices by large cable operators and their efforts to protect cable TV programming. While this is understandable from the cable operator's perspective, the article points out how capping will affect popular services such as Steam for game content publishing and distribution, cloud-computing and online media services. Apparently this is also an effective way of going after casual piracy."

31 of 395 comments (clear)

  1. In Europe by __NR_kill · · Score: 5, Insightful

    In particular in Belgium, there are just a few ISP's that do not have any capping. The major ISP's make BIG profit of the users who want to download lets say, more than the 40GB they offer. It's NOT a DRM, it's just another way to squeeze more money from their customers.

    1. Re:In Europe by Sumbius · · Score: 4, Interesting

      I'm paying 44EUR for 1Mbps but no limit. (well, not at least any real limit. They just check the stats and say "Hmm, that poor pirating bastard has used 5GB of our precious bandwith this month." and press the button. No letter nor anything whatsoever.) This is madness. My ISP cut the phone lines where I live (is that even legal?) and the only wireless connection available is by that ISP! They simply forced my neighborhood into using their pricey and low quality connection. (1Mb max, 6 hour waiting line in the service phone and sometimes the connection just vanishes for a couple of days.) No mattter, I'm moving out in a few months. It's rare that someone moves because of their ISP...

    2. Re:In Europe by Anonymous Coward · · Score: 4, Insightful

      Bullshit.

      It may hold true for Belgium /in particular/, but Europe is too diverse to conform even loosely to the shenanigans you mentioned.

      On the oposite side of the spectrum, less than two hours away by plane, we have Sweden, where a 100Mbps pipe costs less than a Big Mac meal per week.

      Your neighbour, Holland, has pretty decent Internet, as does Germany, Finland and France.

      Damn ignorant first-poster.

  2. Why Not Just Metered Service? by blcamp · · Score: 5, Insightful

    Rather than have these ridiculous, confiscatory rates for so-called "unlimited" service (which will still be capped under some other excuse)... why don't the ISP's just provide metered service?

    This way, Grandma who just wants a couple of recipies every now and then, and occasionally looks at baby photos posted on thier adult children's Facebook accounts (and is not pulling down 10GB/month)... only pays a little bit.

    And the Torrent operators pay for what they use.

    Pay for what you consume. Fair for everyone.

    Or is that too much common-sense for all involved?

    --
    The problem with socialism is that they always run out of other people's money. - Margaret Thatcher
    1. Re:Why Not Just Metered Service? by Akido37 · · Score: 5, Insightful

      Pay for what you consume. Fair for everyone.

      Or is that too much common-sense for all involved?

      Because that's bullshit.

      The ISPs' costs aren't based on how much you download, but on the bandwidth they provide. A better limit, and more fair for consumers, would be tiered service based on speed.

    2. Re:Why Not Just Metered Service? by sqrt(2) · · Score: 5, Insightful

      Because the cost to the ISP isn't based on how much I use. They have to maintain the infrastructure no matter how much it's being utilized. Their operating costs are the same whether their customers are using 50% of their bandwidth capacity or 99%. I shouldn't have to pay more because I use the resource that is available. If they are unable to deliver the service they are selling then they need to invest in upgrading their capacity. Bandwidth demand is only going to increase, gouging customers is not a solution to the problem.

      --
      If you build it, nerds will come. Soylentnews.org
    3. Re:Why Not Just Metered Service? by John+Hasler · · Score: 4, Informative

      > Because the cost to the ISP isn't based on how much I use.

      No. Their last mile capacity depends on your peak uasage but as soon as you get far enough upstream to be dealing with the aggregation of a significant number of users it depends on average usage. There is no ISP that would not have problems if all its customers maxed out their connections at once.

      --
      Warning: this article may contain humor, sarcasm, parody, and perhaps even irony. Read at your own risk.
    4. Re:Why Not Just Metered Service? by Albanach · · Score: 4, Insightful

      Because, unlike a real utility like water or electric, it doesn't cost big ISPs anything more whether you use the service or not. They peer their costs amongst each other.

      So laying cables and Cisco routers, they all come free if you're an ISP, yes? Where do I sign up?

      Come off it. You can argue about the size of the caps, then I'll listen, but to pretend that increases usage doesn't impose any additional costs on ISPs in nonsense.

      Most ISPs report that a very small number of users use the majority of their bandwidth. When their capacity hits a bottleneck, all their users start to suffer. The ISP has two choices - increase capacity, which could be straightforward by adding a couple of extra routers, or could be very very expensive such as installing new DSLAMs or laying fiber between locations.

      So as an ISP what do you do? Eat the cost? Raise the rates for all your customers, even those that use 2GB/month? Kick off the high users for breaking an 'invisible' cap hinted at in your TOS? Or introduce tiered pricing, so those that use most, pay most?

      If you want a debate about whether the level the caps are set at are fair. go right ahead. But to pretend that ISPs somehow have unlimited free bandwidth and that extra usage has no additional cost implication is an untruth.

      I can see two solutions to the problem. Fairly set caps that accurately reflect the increased costs of increased usage, or a service like water or gas where you pay a connection fee and a per gigabyte fee, possibly with tiers so costs increase faster with very high usage.

      There's a problem with this in the US - very limited competition. If you're not competing against anyone else, why try and lower your profit margin? Until the US sorts out local loop unbundling, so there's real competition over the last mile, US customers will continue to be gouged.

    5. Re:Why Not Just Metered Service? by sqrt(2) · · Score: 4, Interesting

      If all the customers are using their connection in such a way then that is the capacity that is being demanded and that is the capacity that the infrastructure needs to be able to handle. If it can't handle it, then the answer is simple; upgrade the network. Now that's an exaggeration, but the truth that no one at the ISPs wants to deal with is that raising price to encourage people to use less is not a long term solution. Eventually there is just going to be too much data being moved around and they'll have to expand their capacity. This is going to cost money and no one wants to spend it, especially when it's easier (in the short term at least, but they're shooting their own foot) to just charge more and change their business model to an arbitrarily priced metered service with hard caps.

      You're never going to convince the private sector that investing in more capacity is a good business move. Business can't look that far into the future. They see an easy way to make more money and that's what they will go for despite the fact that it's completely irresponsible and shortsighted.

      --
      If you build it, nerds will come. Soylentnews.org
    6. Re:Why Not Just Metered Service? by TheRaven64 · · Score: 5, Informative

      Unfortunately, you are entirely wrong. ISP have two sets of costs. One is for providing a connection. The other is for the amount of data you transfer off-network. It costs them the same amount to provide me with a 10Mb/s connection that I use to transfer 1GB/month or a 512Kb/s connection that I use to transfer 1GB/month. The fact that they provide me with any connection at all incurs fixed costs in terms of infrastructure. The amount of data I transfer incurs costs from their upstream providers (or, in the case of the really big ISPs, the traffic affects the networks that will peer with them for free).

      This is why ISPs have been slowly moving from tiers based on different speeds to tiers based on usage amounts. The cheapest packages generally don't seem like good value, because the cost of providing the line is a fairly major part of them, and per-GB they are very expensive. The only reason that faster lines cost more is that they make the usage spikes bigger. If you go from 0 to 100% usage on a 512Kb/s line, it produces a much smaller spike than if you do the same on a 10MB/s line, and this makes it harder for the ISP to estimate their maximum total transfer and therefore the capacity they need for their upstream links. This is part of the reason why a lot of them have started providing different on-peak and off-peak caps.

      --
      I am TheRaven on Soylent News
    7. Re:Why Not Just Metered Service? by metamatic · · Score: 5, Insightful

      The amount of data I transfer incurs costs from their upstream providers (or, in the case of the really big ISPs, the traffic affects the networks that will peer with them for free).

      And they are welcome to pass that cost on to me. I'll gladly pay the approx. 3 cents per GB.

      Wait, they want to charge $1 per GB? Suddenly it seems less reasonable, yes?

      --
      GCHQ Quantum Insert installed. If only our tongues were made of glass, how much more careful we would be when we speak
  3. the whole isp capping is a big scam by ionix5891 · · Score: 5, Informative

    I run several huge sites (bigger than slashdot)

    and we use 1200 to 1500 mbit outbound at anytime

    our agreements with datacenter and carries mean we pay $US 4.5 a mbit @ 95th percentile during peak hours ONLY (thats 12:00 to 24:00GMT)

    outgoing bandwidth offpeak time is FREE

    incoming bandwdith is FREE

    alot of large isps such as Comcast or UPC can peer for practically free with datacenters (who are heavily outbound) as these isps are heavily inbound

    this whole bandwidth cap is a joke, and site operators already pay alot of the privilege and were talking about pricing per mbit per month here not per GB

    1. Re:the whole isp capping is a big scam by mattbee · · Score: 4, Informative

      You're comparing apples and oranges - internet transit bandwidth is cheap because for a particular piece of switch or fibre infrastructure in a data centre (where your hosting is), there are multiple commercial uses and plenty of opportunity to sell your bandwidth so it's used maximally. This results in a multi-tier system where you pay for a commodity according to volume, and a handful of centralised engineers can maintain it. Your sites are reaping the benefits of that economy.

      The infrastructure for providing data bandwidth to residential areas has usually been put down by one or (if the area is lucky) two companies, involving very expensive digging up of public land. The return on investment for a particular piece of cable can only be provided by the homeowners, who are very price-sensitive compared to businesses. This infrastructure is mostly single-homed, needs roving national teams of engineers to maintain, and for a return that is often heavily regulated.

      That's why (as a relatively small player in broadband, but a larger one in hosting) we pay £300-odd per Mb for connectivity to *any home in the UK*, but only £5-15 for "internet transit", where we're not the ones paying for that expensive last mile of connectivity.

      --
      Matthew @ Bytemark Hosting
  4. Killing the Goose... by agorist_apostle · · Score: 5, Insightful

    Let's see...people back in the 90s bitched about having rationed access, so companies got rid of it and went to unlimited use because their competition was. How long is it going to take a competitor to again figure out they can have all the business they can handle if they don't charge for volume?

  5. I've been saying this since comcast instituted it. by DragonTHC · · Score: 5, Insightful

    A throughput cap will only hurt consumers and legitimate transfer-intensive services like steam, netflix, xbox live, and hulu.

    The large few ISPs like to say that it's 1% of their subscribers who aren't playing fair. That's just not the truth. They see a trend emerging and they're not happy about it.

    You don't institute major policy change because of 1% of your users. You do it because in less than a year, it could be 15%-20% using as much as the 1% currently uses.

    Why? Online content providers are now offering larger quality services and more transfer-intensive services. Comcast certainly didn't like that. They have to pay for traffic outside their own network.

    It really is a scam. They sold me unlimited service and they have reneged on their part of the deal. They altered the contract. That should be illegal, but they did it.

    Caps and metered service are both money-saving scams. They will not prevent the inevitable.

    The only real solution is to increase network capacity.

    --
    They're using their grammar skills there.
  6. a market based entirely on Artificial Scarcity? by NZheretic · · Score: 4, Insightful
    Monday, July 17, 2006

    Network Neutrality : Two question for the great debate. In California there was an outrage when it was disclosed that electricity companies had deliberately idled plants while supplies were tight and then waited for prices to skyrocket on the spot market. If the current Internet network infrastructure provided by the backbone providers and Internet service providers can currently support much higher speeds and data quantities to current customers, then is the act of packet filtering and setting arbitrary low speed and data caps also effectively providing an "idled" service? Is a tiered Internet service, where content providers would be effectively competing on a similar market to the electricity "spot market", a market based entirely on Artificial Scarcity?

  7. Re:So who gets rationed? by __aatmkh9910 · · Score: 5, Insightful

    ISPs just need to upgrade their backhauls to accommodate more traffic, they are selling people bandwidth that doesn't exist and hoping people don't use it, ISPs need to fess up about exactly how much bandwidth each customer will get. Here in the US, at least where I live, Verizon is one of the only ISPs left that doesn't do any sort of throttling or capping, and I've seen more than a few people switch to them for that exact reason.

  8. What scares me.. by rotide · · Score: 5, Insightful
    Caps are fine, at least in the sense that they ALWAYS existed under some vague asterisk following the word "unlimited".

    But what's got me worried is the fact that when I started playing around on the internet, the most heavy web surfing was a few gifs and/or jpgs.

    Now, we have full flash animations, games, interactive multimedia presentations. Not to mention embedded audio and video.

    Downloads use to be smaller as well. Now with more bandwidth available, software gets bundled with more features and more multimedia. Game demos have gone from 10-20 meg up to 500meg to 2+ gig, easy.

    Hell, I'm a legit user, I don't download music (anymore, I did when I was younger) and I don't pull pirated movies/software either. I don't run bittorrent except for the occasional WoW update (when I did play). But I've seen a large jump in bandwidth usage with my new Roku box for watching NetFlix on my tv. That's a lot of streaming video. Are they keeping tech like this in mind? Doubt it.

    So, say the caps are aimed at the bandwidth of today, ok, fine. What happens "tomorrow" when demos START at 2gig+? What happens when the only video online starts at widescreen HD? Our bandwidth usage, for simple surfing, has been going up. It would be shortsighted to think it won't keep going up. If the companies with hard established caps don't keep growing your cap, you're going to eventually have to pay for the top tier.

    Bandwidth usage inflates with time. I'm not holding my breath that the ISP's will generously increase caps over time.

  9. Re: fixed amount of bandwidth by transporter_ii · · Score: 4, Informative

    And not only is there a fixed amount of bandwidth, but they oversell this bandwidth by a large margin. To build out a system where each and every person could utilize 100% of their bandwidth at one time would cost a fortune...and it wouldn't be sold for 29.95 a month.

    Go and look at some prices for services with guaranteed bandwidth. Suddenly, the tiered prices don't look so bad.

    As someone who worked at an ISP, I do feel for them. I quit my job because I could see the coming bandwidth crunch where I worked and I knew that no matter how we tried to play it, we would piss people off.

    transporter_ii

    --
    Doctors destroy health, lawyers destroy justice, universities destroy knowledge, religion destroys spirituality
  10. Re:So who gets rationed? by Anonymous+Brave+Guy · · Score: 4, Interesting

    ISPs need to fess up about exactly how much bandwidth each customer will get

    Yes, they do.

    I wish ISPs would be more transparent in their pricing policies, bandwidth and contention ratios, because then the people around here who want 8GB unlimited traffic for $10 a month would get the abrupt reality check they seem to need.

    --
    If you disagree, post your argument. (-1, Overrated) isn't your personal censorship tool for views you don't like.
  11. End around net neutrality? by MojoRilla · · Score: 5, Interesting

    I wonder if this is an attempt by the ISPs to end around net neutrality. They set these caps low, users won't pay. But certain third parties who make revenue sharing deals with the ISPs (think Hulu, YouTube, etc.) are exempted from the caps. Since users won't pay higher for uncapped data, it will drive users to the "free" services, creating more revenue for the ISP.

  12. Re:So who gets rationed? by TheRaven64 · · Score: 5, Insightful

    Did you read the small print? I'd be very surprised if you are paying for 6Mb/s all day every day. Most likely, you are paying for a connection that supports peak throughput rates of 6Mb/s. It is possible to buy 6Mb/s connections, but they run to hundreds of dollars a month. If you think you can pay a few tens of dollars a month for a 6Mb/s connection that you can saturate 24/7 then I have a diamond ring to sell you.

    The only thing I have a problem with is ISPs not advertising their caps clearly. When they started selling broadband connections, there wasn't enough interesting content for most people to use more than a tiny fraction of their capacity. Now there is a lot more, and people are starting to go over the invisible line that they drew with the maximum that an average user would need. If you really need a connection that you can saturate, then you buy a leased line, and pay for it. For the price of my (capped) 10Mb/s connection, I could buy something like a 256Kb/s connection which allowed me to saturate the link all of the time (it would more if I want an SLA that guaranteed a certain uptime it would cost more). This seems to be what you are suggesting ISPs offer instead, but for most users it would be much less valuable. Being able to download an ISO image in a few minutes, or watch streaming video, is a lot more useful than being able to constantly saturate a slower link.

    --
    I am TheRaven on Soylent News
  13. Re:I've been saying this since comcast instituted by Jason+Levine · · Score: 5, Insightful

    They're not excited. They're terrified. With services like Hulu, YouTube, Netflix, and other legitimate online video sources, the draw of their cable TV services is weakened. Why pay the cable company $50 a month if all of your favorites TV shows are online? (Legally, again. Let's not consider pirated shows for the moment as that introduces different arguments.)

    So they institute caps. Now you can download and watch a couple of HD movies from Hulu, but that could eat up your entire month's bandwidth allotment. So you're less likely to use online video and more likely to tune in on your TV. Cable wins. And if you decide to buck the system and view online videos? They charge you overage fees which coincidentally add up to approximately the cost of a cable subscription. Cable wins again.

    And just to introduce a Network Neutrality wrinkle into the equation, I'm pretty sure that they'll exempt any online video services that they introduce. If Time Warner releases "RoadRunner Online" where you can watch your favorite shows on your computer, they'll keep that usage from counting toward your monthly bandwidth cap. The net result will be that ISP sponsored online video sources will be given an advantage (maybe they will thrive, maybe not) while other legal online video sources will be held back with every attempt made to get them to wither and die. All to protect the cable companies' bottom lines.

    --
    My sci-fi novel, Ghost Thief, is now available from Amazon.com.
  14. Re: fixed amount of bandwidth by andymadigan · · Score: 4, Interesting

    http://stopthecap.com/2009/04/10/why-is-time-warner-saying-costs-increasing-to-consumers-but-decreasing-to-stockholders/

    Time Warner spent $150 million on network upgrades while receiving $4.1 Billion in revenue from their high speed data services. We're a long, long way off from getting our money's worth on services here in the states.

    --
    The right to protest the State is more sacred than the State.
  15. Workaround for Comcast Cap: Earthlink. by LostCluster · · Score: 4, Informative

    Ask Earthlink's semi-automated chat service about the Comcast Cap applying to their cable-modem-over-Comcast's-wire service, and they'll tell you that it doesn't apply to you because you're Earthlink's customer and they have no such policy. You'll save a couple bucks based on the local Comcast price, but you'll be limited to to the 6mbps/768kbps which is Comcast's lowest speed level. (Though you'll still get the Comcast PowerBurst instant speed double.)

    That, and people will wonder why you have a @earthlink.net e-mail address still...

  16. Re:So who gets rationed? by ThatDamnMurphyGuy · · Score: 4, Interesting

    I completely believe there is fine print. Regardless, they sold it as "unlimited". Yes, 6M is a peak throughput, but there was no restrictions on WHEN nor HOW LONG I use that 6M peak throughput.

    I'm actually ok with caps as long as they're sane. 5GB per month is not sane. 1 Steam game can put you over that quite easily. Caps simply will not be viable in a future where everything moves over the connection; esp when it's the same ISP moving IPTV.

    Metered would be ok with me as well. It would be interesting to see what happened if metered billing became the norm. I wonder if AdBlock would become a norm, and if there would be a movement back to more thin looking websites to save the bandwidth for the actual data rather than the look n feel.

  17. Better Than DPI by Bob9113 · · Score: 4, Insightful

    Total transfer has a cost. Your connection to the Internet, if kept running wide open full time, would be a money loser for the ISP. There are essentially three solutions to this:

    1. High transfer users are subsidized by low transfer users. This will fail as everyone becomes a high transfer user. My Mom now sends me YouTube videos occasionally.

    2. Deep packet inspection (DPI), with the high transfer user of services the ISP likes being subsidized by the high transfer user of services the ISP does not like. IE: They charge company A or inhibit customer B, while allowing company C to send high volume content to customer D. Some ISPs think this it the right answer because some services are inherently high volume. Others like the idea of being a toll-road and getting to charge monopoly rents. Ultimately this is insidious because it hides the cost and distorts the free market.

    3. Tiered pricing based on the numbers of 1's and 0's you consume, but without regard to which 1's and 0's you consume. IE: net neutrality with tiered pricing.

    Of those three options, is there really any question that option 3 is the best?

    One may argue, "The ISPs are charging too much, their profit is too high, it's an inefficient market and prices are too high because of lack of competition." Fine, maybe that's true. The answer to that problem is increased competition. Asserting that the ISPs should not be allowed to use option 3 to solve a problem which may be real, however, can only lead to either option 1 or option 2 being used instead. Option 1 would imply increasing the price to everyone. Is that really fair? Should I really continue to have my Internet access subsidized by the guy next door who doesn't use high volume media? I mean, I like it and all, but it's not fair, it's not free market, and it makes the ISPs want to find ways to shut me off so they can focus their business on the guy next door.

    Option 3, on the other hand, makes me the most important customer to the ISP. It makes them want high volume users. It makes them more money when we use more Internet. Suddenly the ISP's profit incentive is directly in line with making the Internet faster and encouraging high volume services. Seems like a pretty good thing, no?

    So choose your poison:

    1. Subsidization with the ISP hating high volume users.

    2. Deep packet inspection with the ISP choosing which 1's and 0's are "good" and which are "bad".

    3. Net neutrality with tiering, and the ISP becomes profit motivated to encourage high bandwidth and high volume services.

    Gee, tough question.

    Tom, I love ya. I was making banner ads for your site back in 1997, and loved every little review you put out. But you're off your nut on this one.

    --
    Stop-Prism.org: Opt Out of Surveillance
  18. I can't wait for the work-from-home effect by octaene · · Score: 4, Interesting

    Here at IBM, our company has just decided to stop reimbursing work-from-home employees for Internet access. Combined with this new data transfer capping trend, I fully anticipate having to explain to a customer why I can't take care of that server problem until next month because my daughter used up our bandwidth allocation on the Playhouse Disney web site. That's going to go over really well...

  19. Re:So who gets rationed? by evilkasper · · Score: 4, Insightful

    So when I was trying to find out what my ISP's version of "unlimited" was it took me forever to actually find the page where they list the caps for the different tiers they have. I'd get pissed and switch to a different provider but it's not really an option, which seems to me to be the main reason for the poor customer service. Most of us have 2 options if we are lucky, not a lot of need for them to compete for our business.

  20. Re:So who gets rationed? by thePowerOfGrayskull · · Score: 4, Informative

    I completely believe there is fine print. Regardless, they sold it as "unlimited".

    This requires a bit of context, doesn't it? "Unlimited" began being advertised at a time when dialup was charging for hourly use. The cable companies saw an opportunity here - "always on" connections that were not time limited. Hence "unlimited". I don't think there was a discussion around unlimited bandwidth even then -- just an assumption of unlimited connectivity in comparison to the time-limited usage of dial-up.

    So you think they'd get with the times and stop advertising unlimited, right? Well... guess what, they have. I can't find any of the major carriers advertising "unlimited" service, and haven't for several years now. So maybe you were among those who did sign up when they advertised "Unlimited" [connectivity] - your TOS agreement also lets them change that whenever they want.

    This isn't what we want to hear, but it seems to me that they're the basic facts of the matter.

  21. Re:So who gets rationed? by mpcooke3 · · Score: 4, Insightful

    Regardless, they sold it as "unlimited". Yes, 6M is a peak throughput, but there was no restrictions on WHEN nor HOW LONG I use that 6M peak throughput.

    It's a bit like a water-slide park, where they originally charge kids $20 for 10 slides that have to be used the same day. Then they switch to a new pricing scheme where kids can have an unlimited number of slides on that day for $20.

    The scheme is so popular at drawing people in, none of the kids can get more than 5 slides in because the queues are so long.

    Sometimes people running a club do the same thing over here, you pay one fixed price to get in and you get unlimited drinks! Only catch is that the club is always packed and they only have 1 slow barman serving. It's also a very unpleasant experience at the bar!