Time Warner Cable Tiered Broadband Test Begins

from the if-only-there-were-competitors dept

Earlier this year, the story came out that Time Warner Cable wanted to experiment with capping its "unlimited" broadband, trying to force the heavy users to pay more. Even worse, it appeared to want to use exceptionally low caps that would discourage innovation. Despite all of the concerns, Time Warner Cable is moving forward with the test as planned.

The end result will be taking away value from customers -- not just in limiting how much bandwidth they get, but by adding a huge mental transaction cost. Basically, what Time Warner is doing, is adding a huge overhead in terms of whether or not users are willing to actually use the bandwidth they signed up for. Just the fact that people need to think about how much they're using will decrease usage significantly. While that may be what TWC wants, what it really does is annoy customers. This would never actually happen if there were real competition, but with very little competition out there, TWC can try out this plan. Any other broadband provider competing against TWC in areas where this test is going on should be hitting on the limits in any advertising campaign. TWC is free to do whatever it wants, of course, but it's never a good business move to take away features from customers -- especially if in doing so you add an annoying mental transaction fee.

Filed Under: broadband, broadband caps, cable, tiered service
Companies: time warner cable

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  1. identicon
    networking guy, 6 Aug 2008 @ 2:05pm

    stop complaining already

    Dear complainers,

    Please stop complaining about time warner cable and the rest of these ISP's that are really just a business trying to make a buck....

    I work for a fortune 500 company in the network engineering dept. The bottom line is there is not infinite bandwidth or capacity

    (in fact the network is really just a best effort facility, kind of like a highway, too many cars and you have gridlock, you can't just quickly build another highway cause more cars are on the road, you have to come up with ways to manage the cars, carpool hov lanes, charge tolls,etc.)

    but employees think there should be until we tell them how much it costs per month to upgrade thier bandwidth at thier location. Then they start to look at thier income that would be derived from the additional bandwidth and make a cost benefit decision. Do they really need it? Is it worth the cost. Are some of the things currently being done on the network not really important.... (e.g people browsing the internet on company time, listening to music,etc. etc.). In other words do the most important things first (in the case of a business run it, then if there is any bandwidth left - just be happy and use it for unimportant stuff...)

    Additionally all ISP networks are shared environments. Expecting there to be infinite capacity at a fixed cost simply demonstrates how naive you are. Is there anything else you purchase for a fixed price that comes in infinite supply....? We all pay for water by the gallon, electricity by the kilowatt, gas by the gallon. etc. etc.

    The only solution to this problem is for people to simply pay as they go for bytes transmitted and a premium for higher transmission speed. Those who use more pay more. Isn't that fair? There is an incredible amount of money spent to keep the network healty, swapping out old gear for new gear, dealing with new hardware and software testing. Support new protocols on the network, upgrading vendor equipment. It costs a lot of money.

    The flip side is the ISP's should really reduce thier costs so that users who use very little pay very little.... that helps people to be self policing (more conservative people just pay less).

    anyway go ahead and flame away with your responses....

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