Time Warner Expanding Their Business Model

Which is really all they are doing in their latest move, they are experimenting with tiered broadband pricing, or, another way around Net Neutrality. They are testing it first in Beaumont, Texas, a town with a population of over 100,000, their website says half a million in the Beaumont area, so this is probably a good spot for Time Warner to test this. If they get through this without many complaints, and unless Beaumont is a hotbed of P2P action, they probably will, look for them to roll it out to everyone.

Time Warner said on Wednesday that it was going to start testing a new rate plan in Beaumont that would limit the amount of bandwidth each customer can use each month before additional fees kick in. Alexander Dudley, a Time Warner spokesman, said that the exact terms had not been set, but that packages would probably offer between 5 gigabytes and 40 gigabytes a month. The top plan would cost roughly the same as the company’s highest-speed service, which typically runs between $50 and $60 a month. Source: Time Warner: Download Too Much and You Might Pay $30 a Movie

The NY Times article gives an example using the Apple TV, and say you want to download a high-definition movie, if you are over your limit already, downloading that thing could cost you $30 bucks! Talk about inflation. Well, the average HD movie on iTunes is between 1 and 2 gigabytes each, so, that will limit you to downloading two or three movies a month on their lowest plan, 20 to 30 on the highest plan. Not to mention, Xbox Live, regular internet surfing, photo sharing, etc, this is total crap.

But, if they roll it out now, MOST people won’t notice because they aren’t doing that, YET. This won’t hit most people until every ISP is doing it and they start getting those Internet connected TV’s and realize the movies look better streaming from the net than they do over the normal cable system. EVERYONE who gets slapped with a service like this needs to go to another provider, if they can and complain loudly. This is just the way the cable companies are going to use to get a piece of the bigger pie that Google and other big portals have been enjoying for years. The Telco’s, cable companies, and other ISP’s think they are the Internet when they are just your connection to it, they don’t deserve to be paid multiple times for the same product. Think about it, Google already pays for their bandwidth, same as us, so, every bit is being paid for at least twice, and now they want more.

Mr. Dudley said that Time Warner wants to test bandwidth limits to crack down on a minority of customers who are heavy downloaders. Indeed, only five percent of customers use half of its total bandwidth, he said.

“This is not targeted at people who download movies from Apple,” he said. “This is aimed at people who use peer-to-peer networks and download terabytes.”

Then why don’t they raise the caps to a terabyte, or a few hundred gigs before they start charging? Because then it would only affect 5% of their customers, and that wouldn’t be a very big increase financially at all as those 5% will move to another provider, guaranteed. They oversell their bandwidth to start with, meaning, if a POP can support 10 gigs of sustained traffic, they will sell 20 gigs, because not everyone uses it at the same time and they usually don’t have to worry about it. Bell Canada is already doing this and charges almost $7.50 per gig of overage, how much does that gig cost them? I would bet the article is close to being correct when it says it costs the ISP about 10 cents a gig.

This is all about making more money off of the Internet, but, if people quit using it because it costs them too much, then they, the cable companies and Telco’s, will end up shooting the golden goose themselves.

This is crap, it needs to be treated like crap, everyone needs to complain loudly and switch to a competitor, if they can. Search your area, there may be more broadband providers than you think.