Comcast CEO: It's Not A Broadband Cap, It's A 'Balanced Relationship'
from the semantic-manure dept
Comcast continues to play semantic patty cake as it defends the company’s broadband usage cap plans. With about 12% of the company’s customers now capped (and growing), Comcast insists the 300 GB monthly usage cap (with $10 per 50 GB overage fees) is simply a “trial” of a new, “balanced” relationship. You see, Comcast isn’t just taking advantage of a lack of broadband competition to cash in on Internet video, it’s simply experimenting with “flexible data consumption plans” that bring greater choice and freedom than ever before to customers of the least liked company in America.
Speaking at a conference last week, Comcast CEO Brian Roberts added more insult to injury by insisting that imposing such limits on broadband makes sense, because broadband is just like gasoline and electricity:
“Just as with every other thing in your life ? if you drive a hundred thousand miles or a thousand miles you buy more gasoline,” Roberts said during Business Insider’s Ignition conference on Tuesday. “If you turn on the air conditioning at 60 versus 72, you consume more electricity,” he said. “The same is true for [data] usage, so I think the same for a wireless device ? the more bits you use, the more you pay.”
Except that’s nonsense. Unlike gasoline and electricity, Comcast’s cost to provide broadband is fixed. It costs Comcast the same to deliver 10 Mbps as it does to deliver 50 Mbps, and while the company does incur capacity costs overall, generally they’re easily offset by modest network investments like the upcoming upgrade to the DOCSIS 3.1 standard. Any ISP earnings report will show you that with bandwidth costs generally dropping, flat-rate broadband profit margins are incredibly healthy, and it’s the cost of service and support (which again Comcast is literally the worst in the country at) that tend to be the biggest expenses.
Roberts knows this, but his attempt to distort what the company’s doing has been par for the course so far. Roberts also trotted another favorite Comcast claim — that what the company is doing isn’t a bandwidth cap:
“They’re not a cap,” Roberts told attendees. “We don?t want anybody to ever not want to stay connected on our network.” Comcast is, the CEO claims, “just trialing ways to have a balanced relationship.”
Except again, there’s nothing “balanced” about what Comcast is doing. Users previously on unlimited (and already expensive) data plans not only face caps and overage fees, but they have to pay $30 to $35 if they want the same unlimited usage they enjoyed yesterday. Surely there’s a planet where the populace thinks a mammoth rate hike of no benefit to the consumer can be considered “balanced,” but it’s certainly not this one. Remember, Comcast’s own support documents have shown that these caps are in no way technically necessary. They’re a rate hike to protect Comcast’s TV revenues from Internet video.
It’s clear Comcast brass hopes that by moving slowly, and framing the caps as a “trial” that offers “flexibility,” it will keep the public and regulators slack-jawed and docile. But the company needs to tread carefully. ISPs have whined incessantly that they shouldn’t be regulated like utilities despite being so eager to bill like them. And despite a lot of hand-wringing over “utility regulations” during the net neutrality fracas, so far regulators have complied, refusing to apply most of the specific utility regulations during the recent ISP reclassification to Title II.
But eventually consumers, the press and a few politicians will realize that unlike gasoline and electricity, nobody is objectively working to ensure that broadband usage meters are accurate. The result has been meters that at times have logged usage even when the modem’s off or the power is out, problems that will only grow as caps expand. As such, broadband ISPs eager to cap may be inviting the kind of price controls and price caps (sorry, balanced relationships with regulators) that gives any good duopoly ISP executive nightmares.