Even Light Users Would Look For Alternatives If Their ISP Uses Broadband Caps
from the would-certainly-help-if-there-was-competition dept
Longtime readers know that I’m no fan of metered broadband or it’s half-sibling “broadband caps.” They’re not the worst thing in the world, but they set in place the wrong incentives, making an internet connection a lot less valuable. There are certainly those who disagree, but we’ve lived in worlds with metered internet access and phone systems before, and it leads to decreased overall usage — and that’s not a good thing. It acts as disincentive to creating the next great internet service that could be a boon to the economy.
Customers recognize this implicitly. They hate the idea of any sort of mental transaction cost associated with “watching” their bandwidth usage — especially since they have no clue how much bandwidth they really use. A recent study highlights this pretty clearly. 83% had no idea how much bandwidth they use — with many not even having an idea of how much data one gigabyte represented. 81% of those surveyed stated they were against the caps, and 51% said they’d look for alternative providers if their ISPs implemented such a cap. Interestingly, even light users were against such plans. That seems to go against what ISPs tell everyone, claiming that light users would be able to get cheaper access. Yet, those light users recognize that it would more likely end up with them keeping the same price, but with more limits.
Now, some will be quick to respond that of course people surveyed will hate broadband caps. It’s like asking people if they want to get less for the same price. But the key point here is how many people would look for alternative providers, combined with the fact that, for most users, there really aren’t many choices. Once again, this highlights the key problem with US broadband: there’s almost no real competition. You have the duopoly of the telcos and cablecos, and not much else that represents real competition. Most of the biggest providers (Comcast, AT&T, Time Warner Cable) have made it clear that they intend to cap broadband. The only really big holdout is Verizon, who is betting that its FiOS offering won’t require similar caps. But FiOS is still limited in its footprint, and it will be worth watching what happens over time. So while there are plenty of skirmishes about things like net neutrality and broadband caps, don’t lose site of the real issue: the lack of significant competition for broadband in most markets.