Surprise! The American Cable Association favors tiered broadband pricing
By Joshua Topolsky 
posted April 28th 2009 5:25PM
posted April 28th 2009 5:25PM
Guess what everybody? Time Warner Cable isn't the only one who thinks tiered broadband is the future -- so does the American Cable Association (ACA). The group claims that a stepped set of packages is the only way in which the high-speed industry can survive the coming hellstorm of your online TV viewing and rampant MP3 downloads. According to ACA president Matt Polka, "the outcome is certain," that metered pricing is on the way -- even if there aren't standardized plans in place yet. The ACA's ex officio chair Patrick Knorr adds that current billing models are "not a sustainable business model," and that "a la carte for the net is consumption-based billing."Though some of the arguments are compelling, the ACA also dramatically suggest that grandmothers shouldn't subsidize those with HD downloading habits, and can't seem to get a fix on just how they want to meter users or what kind of overages should be charged -- both of which seem to be common points of debate. While we're not sold that there's only this single option for pricing broadband (one which heavily favors the provider's bottom lines), the group does bring a tiny bit of thoughtfulness to the discussion, with a member noting that Time Warner Cable's approach hadn't made a very good case for the practice. We suggest a page from Cablevision's playbook, guys.
Just wonder who's funding the ACA???
well fuck the american cable association
I second that!
I third that.
and here's a glorious fourth from the UK
fif!
Rabble rabble rabble rabble!!!
Here! Here!
Why not just fuck the American "freedom"?
I agree!!! this is stupid lets see them make more money from tiered pricing when all the costumers leave to the one or two companies that are not doing this!
everyone is getting pissed because this means more money out of their pockets, with no logical reasoning! shut up all of you! yes, I love getting a ton of bandwidth basically for free, I know I'm being undercharged, and I know I'm not going to like having to pay more, but basically as the article says, it's the logical thing to do and it's fair. now, I know a lot of cable providers will be looking to swing the balance their way and line their pockets, but as long as tiered pricing is implemented in a fair and reasonable way, I see no reason to get as upset and incredulous about this except that you're petulant children who refuse to recognize when they need to pay their dues.
I SUGGEST WE ALL RING THE FCC'S EAR AT!!!!!
http://www.fcc.gov/contacts.html
Amen to that. Obviously they don't know the internet. The next step after "tiered" pricing is tiered servicing and you'll be hearing the same crap from the ACA. "The only way to survive is to put youtube and the top 100 sites in one package and make you pay for even more sites beyond these because these providers already consume most of your bandwidth usage!"
Dump cable, go FIOS!
@ Joe - You, sir, are an idiot if you actually think it 'costs' the cable company more money to send 10 Mbps instead of 5Mbps over the same infrastructure. The only thing they are paying for are the IPs, electricity, new equipment, and repairs. It does not cost them ANYTHING when I decided to download a few torrents, regardless of size. And before you start calling BS, yes, I do know, because I worked at one :-p What they NEED to do is fracking upgrade their infrastructure to support the higher speeds. You know, EVOLVE the network? Amazing concept, i know...
Did I understand wrong or they are supporting that user pay based on usage than on a flat monthly fee???? Like an electricity bill???
funny, I'm not totally opposed to this idea. As long as they are reasonable about the rate they charge. And offer a tool to allow us to monitor how much bandwidth we are using. Having a way for parents to put a cap to prevent the kids from running up a $500 internet bill would probably be nice as well.
Yes, that's what I understood as well. Appealing to that American sentiment of not wanting to pay for other people.
Meanwhile, in Europe, where people have realised that this sentiment applied to broadband, as when it is applied to other areas, is utter tripe, flat-rate broadband has been common since 2001.
But the problems here is that with electricity/water/gas, something has to be made or produced. Bits and bytes are recyclable and nothing is really produced especially when the infrastructure is already in place.
Also, if you look at their quarterly reports, their profits are higher than ever before yet they want to charge a significant markup for something that costs them next to nothing.
While I agree with Jeremy for the most part, the reasoning behind it is that they need to cover the lost revinue from people watching TV shows on the internet rather than paying for the channels from their cable service. It does seem a little unfair, as it meens those who don't watch stuff on Hulu *wishes it was available outside the US* etc still have to pay by usage, but in all fairness those who don't watch TV online are likelly to use a lot less bandwidth anyway.
I know! INSANE asking users to pay for what they use. Crazy talk.
My neighborhood is full of torrent monkeys. We all share the same QAM64 outbound link on the cable and it SUCKS. Bill 'em up the ass and maybe mommy will reign them in.
Anything over $25 a month for 10mb broadband is a total ripoff. Even if you download 500gb of data in a week.
There is no way any provider can back up a failing business model even at $15 a month for 100mb broadband. We are being ripped off plain and simple. Any argument against that is nothing but pure BS in order to try and secure insane profits for delivering data at a very small cost to consumers.
Or does it really cost $.75 to send "meet me at 5:00" by text message? Somehow I don't think so. Broadband internet delivery follows the same exact model. It is just that people are stupid enough to pay providers the money.
And $0.25 to receive that text message.
I agree 100% man. Anyone who tells you this is a business model to survive is full of complete horseshit. This whole tiered pricing concept is garbage. I would understand if bits and bytes were costing them energy to send and receive, but it isnt. The infrastructure sits there like a bridge. Charging people 5 bucks for a toll fee does nothing, but pay for maintanence and pay off the bridge. Priced right they pay the bridge off, maintain the same prices, and make money. This is just another way for companies to make a dime off the American.
I pay $30 for 3Mb from Verizon DSL in my Area..
The infrastructure gets overloaded. They have to build it for peak demand. The electricity analogy isn't perfect because on the hotest days you should pay about 100 times the normal rate given what it costs to get that electricity. It's more like cell phone minutes. In theory, everyone could have unlimited minutes, but why? Peak users put the highest demand on the system, and that should be limited.
Anyway, I'm fine with tiered pricing if (a) you know how much you've used and (b) the prices are reasonable. The cable cos. would get much more sympathy if they weren't all monopolists charging high prices as it is.
Damned corporations. They have 60Mbps+ connections in Japan for about the same prices as American companies while we are being limited severely if this happens.
In Japan, you are heavily taxed for that access to broadband. So you are still paying for it.
this kind of thing just blows my mind... we have been on a strict one fee per month for how long now? the only reason that one even WANTS to switch to tiered billing is to line the pockets of the companies exec's. If the local companies are providing broadband service to next to cost, and half of the price... should that not cause competition? rather than push companies like twc into an even less cost friendly idea to the consumers?
I'm going to be quite honest... i don't use the internet that much more than an average person... but if i decide to download this, stream that or upload something... i really think that with the amount of money paid by everyone from bottom to top should MORE than have covered the companies like twc to give me far superior service, rather than give me the same crappy, often interupted service at a higher price...
but grandmas AREN'T subsidizing heavy downloaders. Grandma is going to get the cheapest, slowest package. Heavy downloaders are always going to go for the Turbo package (using TWC as an example) so the heavy downloaders are already giving them more money. So that argument is complete bullshit right there.
People also forget that the cost of the connection is more expensive than the bandwidth. In other words the cables and wires and the cost associated in the network are more expensive than the wholesale internet costs the cable provider gets charged for, so it doesn't matter how much you use the cable provider will still have to maintain the connection to your house. Bandwidth costs are negligible. I lease a virtual server with 500GB bandwidth a month and I can tell you now that more costs go into hardware & power & backup than the 500GB. Funny thing is, the cost of the server per month is currently less than what I pay TWC for their eventual 40GB cap... its pure hogwash.
I believe the concept of bandwidth caps aren't to cover costs of the use of the network, but rather to discourage over-taxing the network by heavy users. By charging them more for their heavy use, the additional money can be used to expand the network to better handle high amounts of traffic at the same speeds as before. Of course whether that's true in practice is beyond me; I'm just assuming that's the real idea behind the concept of tiered rates rather than covering the cost of usage.
In no way does my post defend TWC or bandwidth-capping schemes...but the shitstorm is coming, because "grandma" (read: seniors) are downloaders, too. As the population ages, utilization of bandwidth is going to be strained.
I personally know a LOT of people over 50 who download night and day.
If the cable companies would take our $$ and invest in infrastructure instead of advertising it might fix the problem.
Just sayin'.
I always thought Grandma was costing them more - even though she isn't downloading anything she is constantly on the phone with tech support and having people called out to the house because she has no idea how to work her router. Wouldn't the cost of paying people to take care of that cost more than my downloading 500 GB a month and never interacting with the company besides to pay my bill?!
We are all just a bunch of fucking sheep, BAAAAH BAAAH
BAAAHMEN!
I love the fact they want a la carte internet speeds, but yet they'll never provide a la carte for cable. Instead they force us to purchase packages with 100 extra channels we'll never watch.
+1 My thoughts exactly.
Hulu, Netflix FTW!
Cable companies have been offering a la carte channels for decades. Where the hell have you been?
Yeah, wtf is "a la carte for the net" supposed to mean when they haven't given us a la carte for TV yet?
Greedy bastards.
I don't want to pay for grandmas to watch lifetime
Interesting how I was down-ranked for pointing out that cable companies have been offering a la carte cable for longer than most of you have been alive. I just can't figure that shit out =)
This is BS to me, but it could lead to a valid argument being raised for a tiered cable channel subscription. Why should I pay $$$ for over 100+ channels, when I only watch 4 or 5 (10 max) consistently. I say if they want to tier my internet use, then they should also tier my cable viewing.
I say upgrade your equipment if you want to survive the "coming hellstorm". Obviously if you can handle more people it means more money in your pocket. Sure, upgrading is expensive, but the secured income from users who know you are upgrading to retain their subscription will pay off in the long run...why does everyone want to get rich quick nowadays, that's what ruined the economy.
Exactly. PLEASE go ahead and start charing me for each MB or GB. Then let me pay for only the 10 channels I watch out of the 200 I've forced to buy just to get those 10 channels. If GrandMa shouldn't subsidize downloaders then I should subsidize the 190 channels I don't want.
My TV bill will go from $70 down to $5 and my internet will go from $55 to $75. I come out ahead. The cable company gets less revenue. The channels few people watch get less of a share so there are less channels for people to watch and the few people that do watch those channels loose then.
Works for me. =P
I thought it, you said it.
I don't watch of shows on television. Why should I pay for them?
If grandma's shouldn't have to subsidize HD download habits then whey do I need 120 channels on the same cable pipe when I only want 4 of them?
Sweet. So the ACA is telling me because I do some light browsing and send e-mail that I will see a significant reduction in my cable internet bill? Heh, what a joke. I'll bet my minimal broadband use still costs me the same as it does now and high bandwidth users get screwed.
Exactly!
If all you do is email and light internet browsing, you shouldn't have to pay $40-$50 a month.
So the ASA doesn't like a la carte pricing for broadcast video, but love a la carte pricing for data.
They want to bill data like a utility, but want to put a baseline price for everyone with excess usage charges rather than a flat per MB rate.
Sounds to me like they want everyone to stuff their bottomline rather than fix any real issues. If they're so concerned about Granny subsidizing Junior, they should charge by the MB with no fixed monthly fee rather than this tiered model which only serves to increase their net income. That way, everyone is charged per usage and those who use little pay little, those who use more pay more.
If they want more money for "new features", what "new features" are they talking about, since this is the open Internet we're talking about?
At the end of the day, their idea that they should be able to charge a metered rate for an unlimited commodity, which is throughput, NOT bandwidth, is ridiculous. They complain about bandwidth hogs, but charge for throughput. Their argument makes no sense.