Time Warner to test Internet billing based on usage

By on January 17, 2008, 5:03 PM
In a move thatís sure to irk many of itsí customers who have come to expect a fixed monthly charge for unlimited data access, Time Warner says it plans to test a new pricing structure for high-speed Internet usage that charges subscribers based on the amount of content they download.

Under the proposed scheme, new customers in the city of Beaumont, Texas will be able to choose from a couple of different plans with varying bandwidth caps. An online tool will enable both existing and new subscribers to track their bandwidth usage, however, for the time being only new subscribers will be charged incrementally for bandwidth usage above the cap.

Time Warner says it wants to improve performance by creating a barrier for super heavy downloaders which, according to the company, represent only 5 percent of their subscribers but utilize more than half of the total available network bandwidth. Unfortunately, if not set high enough, these caps could also hamper the growth of perfectly legal but bandwidth-intensive services such as video-on-demand.

User Comments: 14

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DXj said:
Do not be fooled. No Company, especially Time Warner, experiments with a program like this unless it has promise to increase there the revenue. They must have done a study based upon average usage and found out a tiered pricing structure would generate more income without a "price increase". So now they are road testing it on the unsuspecting to see if the low end users will buy the lower tier and overuse or by the high end tier and under use the service. To time Warner's credit, I have never herd anyone with their high speed internet package complain about the speed. So performance increase is also a false reason for this new tiering structure.
Ironwulftoo said:
Isn't this rather where we were in 1992? Hey! I happen to have an old AOL installation disk, Version 2.3 ON ONE 3.5" FLOPPY from that era. Will Time Warner also take us back to Win95 and DOS ?This is the most insane, greedy thing they have done yet !
Mictlantecuhtli said:
Could someone smarter explain to me where does the cost come from in Internet traffic?Does moving 1 TB of data consume 1024 times more power than moving 1 GB?
otester said:
@MictlantecuhtliNo not more power, just the MAIN lines Time Warner rent have limited capacity and they won't want to upgrade them since well....less profit.In UK it works like this...ISP buys 150/600Mbps pipe from BT. They will try and fit as many users on this pipe, in theory to allow unlimited use (for example an 8MB package) it would be 600 divided by 8 then buy as many pipes needed. But BT makes it very expensive with loads of hidden charges, charges for usage as well as the pipe itself heavily increasing the price for customers an ISP's.So they try to ram it all on the least amount of pipes, limit users usage which basically means limiting the amount of time they are using their 8MB to the fullest on the network.Also luckily for ISP's in the UK, speeds are very bad so they can give you "up to 8Mb" and you'll only receive 7Mb if lucky, usually 4-5Mb, if you're unlikely like me then 2-3Mb.
windmill007 said:
I hope this don't catch on or were all in touble. Not only higher cost but slower speed plus we will only be able to afford to surf the internet. I hope people drop time warner like flys were they are testing this. They need to stop being so greedy and upgrade ther equipment. I mean we are living in the dark ages over here in the us compared to other countries. What we have maybe 2-10MB max here and over in other places they have 100MB+. I think increasing the speed they could demand more money. Not just asking for more money for doing what we all ready do.
TheCheese said:
Sounds like what a satellite company I have in my area called Wild Blue does. Not only do they set a download limit for you, but if you go over it they severely reduce your speeds until you reduce your downloading. I can understand where these companies are coming from but the internet today is not what it was 8 years ago.
Xempler said:
This garbage has already been implemented in Canada since last year. Funny thing is the big companies tried this about 8-9 years ago and it resulted in millions cancelling their services and moving to smaller independent companies who still offered unlimited bandwidth.Call me crazy but wouldn't it make more sense to cancel the services of the 5% of people who are using 50% of the network bandwidth then implementing a cap?
otester said:
@XemplerNo it wouldn't make more sense. Unlimited is unlimited. If they can't produce that then don't offer it. Once you ditch that 5% they'll go for the next 5%.
Julio said:
If the quoted 5% users are the problem then as a consumer I would see it as the other 95% compensates since those are more sporadic 'heavy' users.If I was the ISP however I would understand them wanting to enforce some kind of rule, but if they keep advertising "unlimited" then it's their own fault for the empty promise. Did that make any sense? :)
otester said:
Thing is though these 'heavy users' aren't heavy, they are just using their connection they payed for, it all relates to ISP's not buying dedicated space for their customers.
Deathstar17 said:
Well I would certainly ditch any company that tried to get me to sign up for that...
Julio said:
For what it's worth, one can only be grateful for Internet and the immediate bad press corporations can receive based on customer's feedback and otherwise bad business practices.
vynum said:
I would have to totally agree with Xempler on this."Call me crazy but wouldn't it make more sense to cancel the services of the 5% of people who are using 50% of the network bandwidth then implementing a cap?"But, I wouldn't go as far as canceling the service of the customers, I would simply issue an email or courtesy phone call or both, explaining the situation to the customer.My question is: Where is Mr.Fiber Optic? Isn't the capacity of his underware enormous?And wasn't he suppose to visit us all "at the curb" by now? This was talked heavily in 1995. Its now 2008.
tonylukac said:
I own a small business and this will probably impact me from installing windows updates on repaired computers. I mistakenly posted thinking the limit was expressed in megabytes, not gigabytes. [Edited by tonylukac on 2008-05-09 20:16:08]
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