UPDATE: Some readers say in the comments beneath this post that TWC wants you to pay for its own programming services rather than watching what you choose on the net. That would seem to be worth discussing with regulators.

UPDATE 2: Roch says the City Council needs to get involved.

Tiered pricing for bandwidth is not an inherently bad idea. Video hogs a lot of capacity, and there really is a last mile problem. As Vint Cerf told me last summer, "The edges are at issue, and part of the reason is that there too few competitors providing service."

But Time Warner Cable's 5 gig limit, soon to be tested in Greensboro, is way too low. Look at the usage chart in Killian's article -- a lot of households could exceed the cap pretty easily, and many more will in the future as video grows. More here from Fox 8.

Good quote from Roch Smith, Jr. in the N&R: "I think it's just a terrible thing for the city to have our highest-speed broadband priced in a way that’s unlike every other city our size. Making us a 'test market' makes people on the cutting edge pay more and discourages people from discovering new things, things that are going to be very important in the future."

A protest site (thnx to GM for the pointer).

Comments

[Joe Killian]

Another, deeper story coming this Sunday in the N&R.

[Ged]

I'm sorry, but even 40Gb is a complete and utter joke. Between Hulu, my TiVo on demand, Netflix, YouTube, World of Warcraft and others in my household, 40Gb just doesn't cut it. Doesn't even come close.

This isn't about Time Warner's expenses. This is about TW controlling the digital media that comes into your home. They don't want you to buy digital movies from Netflix or Amazon, they want you to buy them from Time Warner On-Demand. It's as simple as that.

With the advent of HD movie downloads, even 300Gb a month is low. A single HD download is 7 or 8Gb for ONE. Do the math, Time Warner we can't let them get away with this. Customers in Rochester NY and Texas are upset, as they should be. Write, call and email them. Call your local representatives. Spread the word.

And to add insult to injury, there are no high speed internet competitors in many parts of the Triad to switch to.

[liv]

Guess the phone companies are going to be back in business with DSL. I'll do it just because I hate TWC so much

[Ed Cone]

Ged, do you oppose any sort of tiered pricing? Should 300 gigs, or 600, cost the same as 1 or 5?

[cheripickr]

If it causes me to spend less time in front of a computer or TV I'm all for it.

[Louie Mantia]

Do not charge additionally for a service which was provided cheaper in the past. Unlimited is unlimited.

The way things work is this. Your product gets better and cheaper. It doesn't get worse and more expensive.

When TimeWarner does something like consumption based billing, it makes me wish there were another service to switch to. I can tell you that I would not consider getting TV or phone services from them.

[Louie Mantia]

Also, the Internet is growing, not shrinking. Things will only get bigger and bigger. Adding tiered pricing for Internet is, put simply, a greedy move by TimeWarner to get more money in their pockets and prevent you from really enjoying what the rest of the world has to offer you through the Internet.

Remember, TimeWarner is a service, not a product. Imagine if I went over my limit, and wanted to buy another HD movie on iTunes. Not only do I pay for the movie itself, but I am now required to pay TimeWarner for the additional "service". This is wrong in too many ways.

[Ged]

Ed,

As I said above, this isn't about the expenses involved with who uses more bandwidth and who uses less. It's about Time Warner getting left out in the cold when it comes to the digital media I decide to bring in my home. They are implementing these new fees effectively as a "tax" on your internet usage of other content providers and using the excuse that this price increase only effects about 15% of the total users of TWC.

Bullshit. If it only effected 15% of the users, then they wouldn't be doing it.

All this aside, yes, I would pay more for 300Gb a month or 600Gb a month. But given the pricing they're talking about ($1.00 a GB) that means my cable bill could potentially be in the hundreds of dollars. Plus I now have to MONITOR my internet usage to know how much over I am? Again, BS. What I had for free yesterday now costs me $300. I'm pretty sure that's illegal.

It's a tax pure and simple and it can't stand.

[talos]

some area in Greensboro don't have any choices, I have nothing to switch to, but stuck with TWC's Internet Ration Plan. And I don't like a single bit of it. Seeing how the gauge work in their web site. And how the data is calculate wrongly in Texas. That is one can of worm we don't want to open.

http://consumerist.com/5163203/a-glimpse-into-the-future-of-broadband-with-time-warner-cable

TWC's rate of 86% people won't get affect by the new plan are misleading, that number is based on new subscribers in Beaumont TX after the test plan roll out. The demogrpahics are totally different. The voice from Austin and Rochester are loud and clear. People are MAD.

[Ed Cone]

Ged, I'd like to learn more about possible TWC interests here. Wouldn't users of T-W On Demand also be sucking up bandwidth, which would count against the cap? If so, how does a cap favor one service over another?

I understand that flat-rate pricing has been user-friendly, but pricing changes do happen. We have metered usage for many other things, including water and electricity.

I urge people to read the Vint Cerf link above.

Whatever the problems with this TWC plan, the idea that video presents a last-mile problem is not just a corporate fantasy.

He also makes some good points about competition, both in delivery of net services, and America's place in the world.

[greensboro transplant]

There are many unsecured wireless routers in homes. a lot of people don't have any idea that their networks are open. And i've seen some people accessing their neighbor's wireless without realizing it. at the least the news sites and TW should be helping people make sure they're not vulnerable.

i pity the poor sucker whose service is stolen and gets creamed.

[Ged]

"Ged, I'd like to learn more about possible TWC interests here. Wouldn't users of T-W On Demand also be sucking up bandwidth, which would count against the cap? If so, how does a cap favor one service over another?"

No, on-demand movies are part of your cable TV bill, not your internet bill Ed. Which is another reason why this pricing change makes no sense.

I can set my TiVo to record all the HD TV shows I want via TV cable, but as soon as I start to download/stream those same movies through iTunes, Hulu, Netflix, suddenly Time Warner wants to increase my bill by a factor of x10.

Imagine your water bill jumping 10 fold overnight even though you're using the same amount of water you've always used. Would you stand for that?

Do you download OS patches on your computer? Do you have a season pass for any TV shows in iTunes? Do you have a DVR or Tivo that constantly talks to the internet without your supervision?

Do you download virus updates? Do you have Wi-Fi access in your home? Do you watch more than 7 YouTube videos a month? Do you often send and or receive photos from family members over instant message or the web? Do you use Flickr? Do you download games or just plain software?

All these things make caps unfeasible, or at least in the price range they're talking about. If we're talking about $0.01 per GB, yeah, that would be great. $1.00 is obscene.

[newtogso]

Will this price structure open the market for someone else to come in and provide service at a lower cost? Does anyone (more in the know than me)think services such as Clearwire could compete?

[jbg]

Can someone post here a list of local and state representatives we can complain to, including the AG, along with links to their webpages? That would be a very helpful service that I don't have time to put together.

Given TW's monopoly here, it seems like legislation could stop this. We need someone to introduce it quickly. This area does not need this economic blackeye - we're hurting enough.

Ed, Ged is right - TW will send us back to the '90s, technologically, with this move. We will have to take what they choose to feed us through the cable channels they choose to provide, and strip us of the independence of choice we enjoy on the internet. That's moving backwards for the consumer, and it shackles us unfairly. Greensboro will be confined to riding the short bus on the information highway while everyone else passes us with their unfettered access to information.

TW should be absolutely prohibited from doing this in any city where they have a monopoly. The consumer needs choices.

greensboro transplant also makes a nice point about the incentive TW creates for bandwidth thieves. Have fun enforcing that while you simultaneously try to control gang violence, GPD.

[Roch101]

A comment I read elsewhere makes a very good point, that I think puts the lie to the "reasons" for this pricing plan. If the "tubes" are really getting clogged, why the metering on internet access only? How come the other digital data that contributes to cable traffic, like TV and phone are not also being subjected to these changes?

Were we to see new pricing packages that include up to 40 hours of TV viewing a month or 40 hours of talk time on Time Warner Phone, then I might think there really is a problem with the "last mile." Absent that, I think the "problem" is that people are using the internet to watch content Time Warner Cable would rather sell you.

[Mick]

Kinda brings to mind those DTV commercials with all the "cable execs" sitting around wondering what to do vs Satellite TeeVee dont it.

I can see it now...

"I know. Lets raise our prices!" Brillaint! Harrumpf!

[Roch101]

"That would seem to be worth discussing with regulators."

And City Council, which grants the franchise for Time Warner Cable to operate in Greensboro -- up for renewal this year.

[Roch101]

Don't know if this warrants an update to your update but, after a little research it appears as if courts have ruled that cable modem and cable broadband services are "telecommunication services" and thus beyond the direct regulation of municipalities.

Nonetheless, with TWC's franchise agreement coming up for renewal right around the time they want to implement their new pricing, the city certainly is in a strong negotiating position. There are other things they can do too, like actively encourage competition and take a look at a municipal wifi network.

[Bill Wood]

Municipal WiFi is fine for GSO, but what of the rest of triad.rr.com's reach?

I live in Eden, so that proposed 'fix' won't work for me.

corporatism - greed plain and simple.

[Patrick]

I don't recall the particulars, but I think there are some federal preemption obstacles to local regulation of cable companies. It seems to me the solutions would be private competition or government regulation of the pricing. Most/all of the other metered utilities that have monopolies either have regulated pricing (power, gas) or are provided directly by government (water).

[Jim Buie]

With the ability for neighbors to share Internet connections wirelessly, my guess is that two or three or five neighbors could join together and purchase one "all you can eat" plan from Time-Warner and pay LESS than they pay individually now. If T-W adopts tiered pricing, you are sure to see more bootlegging like that, more citizen efforts put into municipal and community wi-fi.

[Ged]

Jim,

Have you ever tried to leech bandwidth from your neighbors to watch an HD movie over wi-fi? If you did, you know this isn't feasible. Plus there are other problems associated with overlapping networks.

[talos]

New York Times once estimated the wholesale cost of bandwidth to TWC is $0.1 per Gb. The math of the markup for the overage is 1000%. That's internet highway robbery. Not to mention the wholesale price has been dropping for the last two years.

The 14% affect by TWC's Internet Ration Plan are based on new subscribers in Beaumont TX. Would like to know the data for existing subscribers, how many were affect by this, and the demographic difference between Beaumont and Greensboro.

If it is only 14%, why bother making everyone's life more troublesome. Contstantly monitoring your own usage, (that cost bandwidth too). What about that digital phone that is plug into the cable modem as well?

Areas like Colfax NC don't have any choices in high speed internet access. Too far away from Embarq's DSL service. No AT&T, Clearwire is not a viable options. TWC is the only game in town. Need more choices, competitions will help improve service as well as price point for consumers.

[Roch101]

Talos, I did a very rough calculation and came up with 360 MB per month for 60 hours per month of Telephone over IP. It' may be a little more than that for "overhead." Another question I expect our City Council to ask Time Warner representatives when they have the franchise agreement mandated annual performance review is whether the people who use Time Warner Phone Service will be treated equally to people who use Vonage when it comes to internet phone usage accruing to the monthly data cap.

[RBM]

Pertinent Data point ?

Scripting News:

Japan can lay broadband pipe for $20 per houshold and it's much faster than anything we have in the US. It costs us $800 per household.

[bob]

RBM: Japan can lay broadband pipe for 1/40 the cost household in part because people there are much more densely packed - multifamily dwellings are more common than in the US, and even single family homes are much closer together. Don't doubt that there are other factors as well, but that's got to be a big one...

[RecycleBill]

Here's something to think about. When I wanted high speed Internet 5 years ago a family member who works for Time Warner recommended I call Earthlink.

I did as he suggested and got Earthlink high speed Internet brought into my East Greensboro home for $5.00 a month less than Time Warner charges.

And they did it on Time Warner's wires and even sent a Time Warner Installer out to hook it up.

Perhaps Earthlink customers on Time Warner's wires will be forced into the same BS as regular Time Warner customers but to date I've heard nothing from Earthlink.

Call Earthlink and you might save some money.

[Phillip Dampier]

We are tracking this issue on StopTheCap, Bob. You'll find a complete list of alternative providers on our site, starting with the Rochester area. We are trying hard to find some volunteer correspondents on the ground in Greensboro, Austin, San Antonio, and Beaumont to help broaden our coverage of this story to those communities. We feel we are all in this together and a united effort is critically important. If anyone wants to volunteer, please visit www.stopthecap.com and fill out the Contact form.

Phillip Dampier

[RBM]

@ bob,

Yeah, I am well aware of that. I actually experience that in reverse out here in Nebraska.

Some have suggested a Rural Electrification Act, for broadband, as remedy for sparse population areas.

The numbers I provide are merely starting points.

[RecycleBill]

Greensboro transplant wrote: "There are many unsecured wireless routers in homes. a lot of people don't have any idea that their networks are open. And i've seen some people accessing their neighbor's wireless without realizing it."

I ran this past my relative who is a Time Warner Tech. He said this happens all the time and people don't realize they are using their neighbor's connection and not their own until the neighbor cancels their service after what could have been years and suddenly their Internet doesn't work.

In many homes users access the Internet through multiple accounts. On my laptop I can access wireless in my home and I have no wireless in my home. And he has no suggestions as to how to stop it unless TW sends him door to door to secure routers for customers.

And that opens up another can of worms as many homes can't be 100% serviced by just 1 router.

[Diane]

In Washington:
Senate
Sen. Richard Burr
217 Russell Senate Office Building, Washington, DC 20510
(202) 224-3154
burr.senate.gov

Sen. Kay Hagan
B40A Dirksen Senate Office Building, Washington, DC 20510
(202) 224-6342
hagan.senate.gov

House
Rep. Howard Coble (6th District)
2468 Rayburn House Office Building, Washington DC 20515, (202) 225-3065, coble.house.gov

Rep. Virginia Foxx (5th District)
1230 Longworth House Office Building, Washington, DC 20515, (202) 225-2071, foxx.house.gov

Rep. Brad Miller (13th District)
1127 Longworth House Office Building, Washington, DC 20515, (202) 225-3032, bradmiller.house.gov

Rep. Mel Watt (12th District)
2304 Rayburn House Office Building, Washington, DC 20515, (202) 225-1510, watt.house.gov

Use this web site to find your representatives in the General Assembly: http://www.ncga.state.nc.us/GIS/RandR07/Home.html

[Billy Scavo]

To Bob,

I just chatted with Earthlink Customer Service and they said that Earthlink customers will not be effected by this change.

[Joe Killian]

When I asked Time Warner Cable customer service whether I would be affected by the change as a customer they also told me no.

But when I talked to an actual media representative from the company as a reporter she said everyone in the Triad whose data travels over Time Warner Cables - including Earthlink customers - would be affected once their current contracts expire.

On Friday I called to specifically ask the Earthlink question again because I'd gotten so many calls and e-mails about it. They confirmed that Earthlink customers would also be affected on the same timeline as TWC customers.

There's unfortunately no way to independently confirm a private company's policy on something yet to come except to ask the actual company.

[Ron Hudgins]

I have never had anything but trouble with earthlink and i am so sick of the problems with them that I am considering turning my connection off and only using the internet at work.