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TWC and AT&T have incentive to cap transfer as large users result from predominently downloading video (or other seedly large bandwidth uses) and those services are competitive to their other video products.
To those that say separate the service from the line, that sounds good, but without access to the service revenue no company would want to invest in the infrastructure. Maintaining a legacy infrastructure is very expensive. The local telcos must maintain the existing infrastructure to provide dial-tone access to EVERYONE (by regulation). The legacy cable companies have an infrastructure that is aging and has its own set of technological challenges, historicaly based on a shared resource hybrid-fiber coax network that is less compatible with one-to-one uses as opposed to "broadcast" TV. In other words laying copper/fiber/coax to homes is not a business you would start if you were looking for a new venture. See all the success Grande has had (sarcasm) and even they have been in the game a while now.
To those that think it just enriches the company's profits, I would somewhat disagree based on segment by segment results of these companies. Wired services have been and are largely in decline. Nevertheless buy their stock as a hedge against future profit-grabbing price increases if you believe otherwise.
And finally, bandwidth isn't free and limitless. It may have a different cost curve than a Coke, but that doesn't make it free.
TWC and AT&T have incentive to cap transfer as large users result from predominently downloading video (or other seedly large bandwidth uses) and those services are competitive to their other video products.
To those that say separate the service from the line, that sounds good, but without access to the service revenue no company would want to invest in the infrastructure. Maintaining a legacy infrastructure is very expensive. The local telcos must maintain the existing infrastructure to provide dial-tone access to EVERYONE (by regulation). The legacy cable companies have an infrastructure that is aging and has its own set of technological challenges, historicaly based on a shared resource hybrid-fiber coax network that is less compatible with one-to-one uses as opposed to "broadcast" TV. In other words laying copper/fiber/coax to homes is not a business you would start if you were looking for a new venture. See all the success Grande has had (sarcasm) and even they have been in the game a while now.
To those that think it just enriches the company's profits, I would somewhat disagree based on segment by segment results of these companies. Wired services have been and are largely in decline. Nevertheless buy their stock as a hedge against future profit-grabbing price increases if you believe otherwise.
And finally, bandwidth isn't free and limitless. It may have a different cost curve than a Coke, but that doesn't make it free.
If only 2% of customers are causing the problems, then why not just drop them. This is not about someone downloading videos illegally.
However, it is about the likes of companies such as Netflix or Amazon whose growing subscriber base will in the future not only compete with the the cable/telco video subscription package, but might do so much cheaply.
It is also about the likes of Apple and others who would let you rent/purchase content on an a la carte basis.
Both the existing distributors and content providers would like nothing better than to keep their existing model by which everyone pays a little for a piece of content (e.g. ESPN) even if they do not watch it.
As for separating the physical service provider from the distributor, not too long ago in the land of dial-up, ISPs were distinct from the service provider -- it is only with broadband that the two were combined. One need only to look at electricity to see an analogy: the generation and distribution are in many place separated. A regulated service provider would get a decent return and would only be responsible for the maintenance and upkeep of the connection. Your deregulated ISP can again be almost anyone that wishes to compete.
This is not about 2% today that use a lot of bandwidth, it is about the 100% that will be using much more bandwidth in the future. It is about getting people used to the idea of bandwidth like water or electricity and paying by gigabyte (or megabyte/kilobyte).
Bandwidth isn't free but there is a maximum you can use at a given speed level: multiply your speed by 60 seconds x 60 minute x 24 hours x 30 days for a month. Just assume a given location will always be using the max and price the speed levels accordingly. Or if you really want to meter usage, then provide everyone the maximum speed and just price on a per kilo/mega/giga basis.
]If only 2% of customers are causing the problems, then why not just drop them.[/b] This is not about someone downloading videos illegally.
However, it is about the likes of companies such as Netflix or Amazon whose growing subscriber base will in the future not only compete with the the cable/telco video subscription package, but might do so much cheaply.
It is also about the likes of Apple and others who would let you rent/purchase content on an a la carte basis.
Both the existing distributors and content providers would like nothing better than to keep their existing model by which everyone pays a little for a piece of content (e.g. ESPN) even if they do not watch it.
As for separating the physical service provider from the distributor, not too long ago in the land of dial-up, ISPs were distinct from the service provider -- it is only with broadband that the two were combined. One need only to look at electricity to see an analogy: the generation and distribution are in many place separated. A regulated service provider would get a decent return and would only be responsible for the maintenance and upkeep of the connection. Your deregulated ISP can again be almost anyone that wishes to compete.
This is not about 2% today that use a lot of bandwidth, it is about the 100% that will be using much more bandwidth in the future. It is about getting people used to the idea of bandwidth like water or electricity and paying by gigabyte (or megabyte).
BINGO! Only 2% cause problems, address those 2%, not the rest of the users. OH WAIT, that wouldn't make them any more money. This is a gentle way of introducing tiered plans. This won't be the end of it. It will be for me because I'm canceling.
BINGO! Only 2% cause problems, address those 2%, not the rest of the users. OH WAIT, that wouldn't make them any more money. This is a gentle way of introducing tiered plans. This won't be the end of it. It will be for me because I'm canceling.
You're both missing the fundamental point. They ARE addressing the 2% with the caps. The other 98% don't use that much.
You're both missing the fundamental point. They ARE addressing the 2% with the caps. The other 98% don't use that much.
And you are looking at this decision only in the context of a snapshot of today instead of considering the larger trend (or wave) that they are trying to address for the future. The fact that it doesn't affect 98% today is why it may stick. By the time it affect a larger percentage, it may be years down the road at which point you will be used to it.
This is why TW tried this earlier as well; but like in the airline biz, all have to follow. If at&t does this, it is only a matter of time until TW joins.
You already see the idea of tiers in wireless at both Verizon and at&t.
Anyone who has a problem with the proposed limits is probably one of those that wish they could take food home from an "all you can eat" buffet restaurant.
A business has to remain profitable. I can respect that.
Anyone who has a problem with the proposed limits is probably one of those that wish they could take food home from an "all you can eat" buffet restaurant.
A business has to remain profitable. I can respect that.
Why would you go to an all you can eat buffet restaurant?
As I posted earlier, this is not about remaining profitable, but locking in greater profits by changing a model they themselves pushed when broadband was introduced. For how many years have they marketed higher speeds than most people really need as they could charge more?
I don't necessarily have an issue with metered usage, but then shouldn't there be one speed for all? You use more, you pay more -- kinda like what is happening with some wireless companies. At least there, they have a capacity issue since there is only so much radio spectrum available in the country. With a fiber backbone, there is much more capacity possible with wired access.
Or perhaps since there is an upper limit on how much data you can consume in a month at a given speed tier, why not just price the tiers accordingly and call it a day. It isn't as if you cannot raise prices for the tiers -- I have seen two increases in two years.
Ironically, if you maintain the existing pricing by speed, the consumers who are paying the most will eventually hit the cap fastest. Basic math can calculate that easily. If you want to keep the same pricing model as today, perhaps they should have different caps for the different tiers.
Why would you go to an all you can eat buffet restaurant?
As I posted earlier, this is not about remaining profitable, but locking in greater profits by changing a model they themselves pushed when broadband was introduced. For how many years have they marketed higher speeds than most people really need as they could charge more?
I don't necessarily have an issue with metered usage, but then shouldn't there be one speed for all? You use more, you pay more -- kinda like what is happening with some wireless companies. At least there, they have a capacity issue since there is only so much radio spectrum available in the country. With a fiber backbone, there is much more capacity possible with wired access.
Or perhaps since there is an upper limit on how much data you can consume in a month at a given speed tier, why not just price the tiers accordingly and call it a day. It isn't as if you cannot raise prices for the tiers -- I have seen two increases in two years.
Ironically, if you maintain the existing pricing by speed, the consumers who are paying the most will eventually hit the cap fastest. Basic math can calculate that easily. If you want to keep the same pricing model as today, perhaps they should have different caps for the different tiers.
Perhaps if the customer is loyal for a number of years, then allow them to be "grandfathered" into an unlimited plan while imposing limits on any new customers. Pretty much like what AT&T did with the original Iphone users that had the $30 unlimited data plan that is not available to new Iphone users.
And you are looking at this decision only in the context of a snapshot of today instead of considering the larger trend (or wave) that they are trying to address for the future. The fact that it doesn't affect 98% today is why it may stick. By the time it affect a larger percentage, it may be years down the road at which point you will be used to it.
Pretty much... like the 8GB hard drive that seemed so huge a few years ago. Because who could ever fill that up, right?
You're both missing the fundamental point. They ARE addressing the 2% with the caps. The other 98% don't use that much.
Here's the problem I have. I am probably in that 2% because I use Netflix and Hulu to death. It's not uncommon for Netflix to be streaming 8hrs a day while I work at home. I am not with AT&T I am with TW so I am thinking about down the road when TW tries capping again. When I signed up with TW their offer was X dollars per month for X speed. Period. Nowhere did it say "but if you use too much over time we are going to cap you". Now that I have taken advantage of services available to me I "use too much" and have to be charged extra for it?
I dont buy for a second that these companies are doing this because of losing revenue from the other content they provide. AT&T hogged the iphone and ipad from the time they existed until just this past month touting it's network capabilities. What did they think was going to happen? Time Warner sells its shows to Netflix (and other online services) and then they want to cap me because I am using the service they sold their content to to watch it?
How does that make sense?
That is like buying groceries and paying to eat them.
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