Law To Ban Broadband Caps Moves Forward

from the not-the-best-solution... dept

We've already noted that NY Congressman Eric Massa believes broadband caps raise First Amendment issues, though we have trouble understanding exactly what those issues are. We're not fans of the caps by any stretch of the imagination -- and, in fact, think that they're bad for innovation and bad for everyone (including the broadband providers implementing them). However, that doesn't make them First Amendment issues. Still, Massa seems committed to introducing new regulations against caps, which may be as misguided as the caps themselves. The real issue shouldn't be whether or not the caps exist; it should be how we can enable more competition in the broadband space, such that caps are no longer an issue. Massa claims his bill will "seek to increase competition among broadband providers," but didn't provide any explanation of what that actually meant. It would be great to see more competition, but it seems unlikely that what's being cooked up here will do the trick.

Reader Comments (rss)

(Flattened / Threaded)

  1. identicon
    Anonymous Coward, Apr 15th, 2009 @ 12:05pm

    Makes no sense...

    I have a habit of occasionally agreeing with Mike Masnick, and this is one such case. Why is the New York congress legislating how a business runs itself? If there is competition in the market place (a big if in many places), then people will choose the service that meets their needs. A supplier with caps will be chosen less frequently than a supplier without, assuming competitive pricing. Foster competition in the market place, not limits on existing businesses.

    reply to this | link to this | view in thread ]

  2. identicon
    The infamous Joe, Apr 15th, 2009 @ 12:14pm

    Re: Makes no sense...

    I agree with legislation preventing caps, but only *because* of the lack of competition in the market.

    As for the First Amendment issues, I don't understand exactly how it comes into play. Seems like he just needed a reason to ban caps, and who is going to vote *against* the first amendment? I'd think there would be a better way to accomplish the goal.

    reply to this | link to this | view in thread ]

  3. identicon
    Aj, Apr 15th, 2009 @ 12:39pm

    Re: Re: Makes no sense...

    Agreed, I don't like the idea of having a law that prevents caps, but due to the lack of competition, it's probably necessary.

    reply to this | link to this | view in thread ]

  4. identicon
    Overcast, Apr 15th, 2009 @ 12:55pm

    It's not a violation of the first amendment. Look - I don't like caps; but government's already busy enough prodding business as it is. Let the market take care of it.

    Question: why did compuserve die?

    Answer: Because they wanted to charge for connection time.

    It's why AOL got to be the giant they were.

    No law was ever needed.

    All this would do - if cable companies start limiting bandwidth is give the Telecom companies a HUGE selling point.

    Perhaps legislation to make it easier for small business to get into broadband would work far, far better.

    reply to this | link to this | view in thread ]

  5. identicon
    RD, Apr 15th, 2009 @ 1:02pm


    This isnt a 1st amendment issue and should not have a law about it. IT would be FAR MORE BENEFICIAL to ALLOW COMPETITION in areas where there are currently govt sanctioned local monopolies. The cap issue would take care of itself in this case, as competition would (should) lower prices and spur better services.

    reply to this | link to this | view in thread ]

  6. icon
    Phillip Duggan (profile), Apr 15th, 2009 @ 1:06pm

    Current Advertising Laws?

    I don't think we should need laws to stop them from capping it though personally I'd appreciate it if it stopped the cap on my own Internet access. But I do think they should be prevented from calling it unlimited. They should have to make it VERY clear that they're selling a capped product and charging $X for everything over that.

    reply to this | link to this | view in thread ]

  7. identicon
    Bradley, Apr 15th, 2009 @ 1:08pm

    So what about cell phone minutes? Or calling cards, if anyone uses them. And didn't dial-up come in tiers at some point in time?

    I don't know that anyone on this site would say they approve broadband caps - except maybe Weird Harold, cause bandwidth is soooooo expensive - but I think most people realize that this law pretty much falls flat on its face.

    The only thing I might consider would be that if an ISP did have a monopoly in a given area, they can't cap that given area since the users would have no outside choice. But even that would be unlikely, especially since most areas have those lovely 2-3 "choices" in most places, between telcos, cable companies, and satellite companies - and it would have nothing to do with free speech at any rate.

    reply to this | link to this | view in thread ]

  8. icon
    chris (profile), Apr 15th, 2009 @ 1:12pm

    the first amendment problem

    the first amendment problem comes up sometimes in the net neutrality debate as a possible abuse by ISPs. if the ISP can control what you do online either by blocking or degrading access or through selective application of transfer caps, then the ISP has the potential to abuse that control, either for financial or political gain.

    ISP's want to limit or block certain traffic to ease the strain on their networks, but once they are able to discriminate against one type of traffic over another, say based on data type (giving streaming video preference over p2p traffic for example) what's to stop ISP's from discriminating against traffic based on vendor or some other non-technical criteria such as political or religious affiliation?

    with the selective application of broadband caps, a similar scenario emerges, where some sites and services are "free" from applying to the cap while others do. mobile carriers already do this by providing unlimited calls to other subscribers, while charging you minutes for calls to a competitor's subscriber.

    if a cable company wants to sell video services over its data service, and it does not want to compete with hulu or youtube, then having the cable company's service not apply to the users' broadband cap gives the cable company's service a huge advantage thanks to the captive audience. by using the competitive service, you run the risk of going over your cap and losing access or incurring a higher bill for service.

    i will admit that is seems far fetched right now, but ISPs have deliberately degraded or blocked access to competitive services in the past, what's to stop them from doing so in the future? what's to stop them from letting politics or religion from entering into the equation as well?

    if the application of caps is subjective, then what's to stop a liberal ISP from providing unrestricted access to The Nation, while counting (or double counting) traffic from fox news? what's to stop an ISP that is sympathetic to scientology from applying caps to the websites of psychologists and scientology critics?

    if there were more competition in the residential broadband space, there would be significant pressure on ISPs to not engage in these kinds of activities. but since the broadband market has failed, perhaps legislation at the state level will be enough to scare ISPs into abandoning their pursuit of caps.

    reply to this | link to this | view in thread ]

  9. identicon
    John Duncan Yoyo, Apr 15th, 2009 @ 1:18pm

    >So what about cell phone minutes? Or calling
    >cards, if anyone uses them. And didn't dial-up
    >come in tiers at some point in time?

    But do they sell those plans as unlimtied cell phone service? It is one thing to sell a package of a known quantity of anything by either weight, volume or time and entirely another to say it is unlimited as long as you don't use too much.

    I think what governments can and should mandate is the acceptable methods to measure band width use and how these limits are advertised.

    reply to this | link to this | view in thread ]

  10. identicon
    JL, Apr 15th, 2009 @ 1:18pm

    There is no competition

    In almost all of Congressman Massa's district there is zero competition for broadband access. Time Warner's Road Runner is it. Time Warner is only rolling out these caps into markets without Verizon's FiOS, and with almost no DSL coverage. Its very easy to say "let the market handle it" but there is no market, there is no competition. I used to live in his district and my only option in 3 different houses was Time Warner.

    I would like to see the congressman add that companies can engage in price gouging if there is at least one competing service available to every customer in its service area.

    reply to this | link to this | view in thread ]

  11. identicon
    Michael Stevenson, Apr 15th, 2009 @ 1:19pm

    Regulated Utility, Anyone?

    Why don't we talk about WHY they are introducing bandwidth caps that will raise the fees customers would likely pay even as overhead is falling in the industry (see )? What about the cable company's vested interest in making video downloads from Netflix, ITunes, etc., prohibitively expensive? Seems like a vertical monopoly to me. There are two ways to treat a monopoly that is holding a market hostage: more competition, or regulation. Regulation is superior for areas where there are huge returns of scale, shared infrastructure, and high cost of metering and calculating use compared to the cost of just letting everyone use it. Sounds like the internet to me.

    reply to this | link to this | view in thread ]

  12. identicon
    Anonymous Coward, Apr 15th, 2009 @ 1:31pm

    Eric Massa needs a Spitzer job.

    reply to this | link to this | view in thread ]

  13. icon
    jilocasin (profile), Apr 15th, 2009 @ 1:33pm

    Re: If we go back to Dial Up rules it wouldn't be a problem.

    Unfortunately there is _no_ competition. If CompuServe charged for connection time and AOL wasn't allowed to offer service over the same phone lines, then AOL would never have had a chance.

    Simply saying that we should increase competition isn't going to make it so. Laying fiber, cable, whatever to people's homes is a natural monopoly. The incumbent phone/cable operator build the network usually with large government subsidies. It isn't really fair to expect a competitor to absorb the cost of laying out a complete network on their own. Besides how many wires do you need going into your house, two, ten, a hundred?

    What we need to do, is what telco's and cable companies successfully fought against, line sharing. Back in the POTS days ISP's were very competitive. Any ISP could use the same copper pair into anyone's home. They had to compete on price, or service offerings. If AOL sucked, then Earthlink was there, if they changed their terms, some no name local ISP could fill the bill. Prices went down, options went up.

    Enter broadband, only the cable company can provide service over the coax, many ISP's offered DSL service over your phone line. Alternate DSL providers flourished, most offering better packages and lower prices than the telcos. Buy off a few Congressmen and presto, only the local phone company can offer DSL over your phone line. Options went down, prices went up, customer service generally stunk. If there is both a DSL and a Cable provider (esp. if the telco is rolling out FIOS) no talk of caps. If the telco is AT&T and offering caps, then so will the Cable company, if there is one. You live too far for the telco's DSL, too bad. A competitor isn't allowed to provide service any more and the telco isn't under any pressure to offer you that service.

    When you choice is accept the unfair offer or do without, that isn't really a choice. If your electric company wanted to offer tiered electricity rates, would you say, just get your electricity from another provider? No? Why not? Same answer to internet access.

    Internet access is like phone, or electric, or water service. It's become a utility. It needs to be regulated like a utility, or we could do what other countries do. Separate the lines from the service. Have the lines be a regulated monopoly and allow anyone to offer service over those lines. We need to treat it like the electric company or like the roads. Pick one. Until then we will fall farther and farther behind the rest of the developed world all to line the pockets of a select few at the expense of the vast many.

    Just my $0.02.

    reply to this | link to this | view in thread ]

  14. identicon
    cmptrgk, Apr 15th, 2009 @ 1:34pm

    Good review

    I agree, it doesn't make sense to ban them, and I'm suprised and delighted to see that you took the same stance. I wish the government would adopt a laizzes faire position and let the market works things out. Of course that assumes that competition reaches all markets to prevent a monopoly from strangling users where it can.

    reply to this | link to this | view in thread ]

  15. identicon
    Anonymous Coward, Apr 15th, 2009 @ 1:46pm

    Let the companies that want to use bandwidth "caps" do it. The Open Market will come into play and those companies will loose their business to the companies that do not cap bandwidth.

    Also at $2 a GB over, I would be looking at about $1500 in overage charges last month and I am well on my way this month. I am against the caps but I think that open market should decide weather these companies should do this or not.

    reply to this | link to this | view in thread ]

  16. identicon
    stuck in NY, Apr 15th, 2009 @ 1:58pm

    No Competition

    I live in one of those areas where TWC is planning caps. There are other choices, but not real useful. DSL and Fios are not available, Dial-up is a long distance call under Verizon and satellite is far too expensive.

    Don't believe for a second that TWC or any other provider is anywhere near the limits of their networks, they just want to make it harder of other companies to provide services and compete. TWC has their own VOIP phone system and is planning on providing on-demand streaming video content, none of which counts toward your cap. But a competitors VOIP service or streaming content will be used against you.

    While it might not be the best solution, I have no choice but to support this bill. I would prefer to to tell TWC that if they implement caps, We'll sign-up with XYZ, but there is no competition in this area.

    reply to this | link to this | view in thread ]

  17. identicon
    Anonymous Coward, Apr 15th, 2009 @ 2:25pm


    apparently you are either clueless or don't read other comments. The problem is, there is NO competition in many areas. So leaving it to the market doesn't work.

    As was stated earlier, Time Warner is only rolling out "caps" in areas where they have no competing service to theirs. So where will those customers go to?

    Oh, and it's "lose" , not "loose".

    reply to this | link to this | view in thread ]

  18. identicon
    Anonymous Coward, Apr 15th, 2009 @ 3:46pm

    Free speech protection applies not just to what we say, but how vociferously and frequently we say it. Bandwidth caps restrict our right to repeat ourselves, or hold forth voluminously.

    reply to this | link to this | view in thread ]

  19. identicon
    nasch, Apr 15th, 2009 @ 3:47pm

    Re: Re: If we go back to Dial Up rules it wouldn't be a problem.

    I think that comment is worth a great deal more than the nominal 2 cents. Well done.

    reply to this | link to this | view in thread ]

  20. identicon
    another mike, Apr 15th, 2009 @ 4:30pm

    broadband monopoly

    Ban service provider monopolies, not bandwidth caps. If I had the choice, I probably wouldn't stay with my current provider. As it is, I'm stuck whining on the internet because there's no one else to sign up with.

    reply to this | link to this | view in thread ]

  21. identicon
    Jason, Apr 15th, 2009 @ 4:44pm

    Re: the first amendment problem


    reply to this | link to this | view in thread ]

  22. identicon
    Jason, Apr 15th, 2009 @ 4:48pm


    Actually they do. A couple months back I was re-upping our plan with AT&T and the heading on the chart under minutes was "Unlimited" and then in the fine print, for the cheapest plan only, with a tiny asterisk notation, it said 1000 minutes.

    So yes, basically you can lie in advertising if you include a notation mark and an illegible blurb that says, "Just kidding."

    reply to this | link to this | view in thread ]

  23. identicon
    net625, Apr 15th, 2009 @ 10:34pm

    If this then that

    IF the government is giving $$$$$$$$$$$$$ to private companies then I think they can cap bandwidth caps. I also think that we should be happy with what ever BS excuse the government. No one seems to be up in arms over the extra 5 trillion in debt that the country is going to take on over the next year...

    reply to this | link to this | view in thread ]

  24. identicon
    Andrew Fitzgerald, Apr 16th, 2009 @ 2:41am

    Re: Re: Re: Makes no sense...

    Yeah, the reasoning may not be the best, and competitive alternatives would be much better, but given no other options, I'd gladly take a poorly reasoned anti-cap law over getting screwed by the cable company.

    reply to this | link to this | view in thread ]

  25. identicon
    Steven, Apr 16th, 2009 @ 5:54am

    It's Easy....

    All the companies need to do is set up plans. While I'm not in favor of caps, it also doesn't make sence for my grandpa who just checks his e-mail to be paying the same amount as the guy down the street who is uploading and downloading movies all day and night every day. What I'm saying is that the plans should be set up like text message plans. You could have a pay-as-you-go plan, and just pay for what you use. Or have a plan up to xGB. Then one up to xxGB. And another for unlimited. This way, everyone gets what they want.

    So say:

    5GB = $50
    10GB = $60
    25GB = $75
    100GB = $125
    Unlimited = $150

    I don't actually pay bills, so I wouldn't know how much it should asctually cost. I was just throwing around numbers. And that's just my opinion. It makes sense. You wouldn't charge someone $10 for 20 texts. Just like you wouldn't charge someone $10 for 2000 texts.

    reply to this | link to this | view in thread ]

  26. identicon
    Anonymous Coward, Apr 16th, 2009 @ 6:04am

    Re: If this then that

    If you really believe what you just said about the additional debt not being a concern to anyone, then you have not been watching television much lately.

    reply to this | link to this | view in thread ]

  27. identicon
    exoteric, Apr 16th, 2009 @ 7:32am

    Caps have advantages

    Caps have an advantage in that they allow a new front or competition. In accepting a cap, a consumer has the ability to save money, or opt for a faster service than they can currently afford. I think people will agree that this is a good thing. What people are worried about is that their current usage is about to get a whole lot more expensive, as light users will not be subsidizing their activities online.

    reply to this | link to this | view in thread ]

  28. identicon
    Adam, May 3rd, 2009 @ 11:25am

    say no to caps

    I really think that bandwidth caps should be against the law. Providers use caps as a reason to not spend money to updgrade their networks. However, caps would not be bad if they fairly represented the price you pay for the level of service you get. Currently providers charge a lot of money for service with a low cap. That makes a cap ridiculous. I live in the area where TimeWarner did a cap trial and a lot of people moved to AT&T. Time Warner set their caps to low, so even an average user was going over. Just keeping your computer up to date (windows and all software) can wipe out your usage for a month, not to mention those people who use netflix or vonage. Caps will eventually cause services such as iTunes, VoIP, and Netflix to disappear. People cant afford the service and overage charges. One of the most ridiculous overage charges for internet service is Verizon Wireless's $256 per Gigabyte overage charge.

    reply to this | link to this | view in thread ]

  29. identicon
    Nick, May 3rd, 2009 @ 12:39pm

    Caps... No one likes them

    Caps are rediculous... I've been using this verizon wireless usb720 for about a year now. They charge me 60 bucks a month and I only get 5 gigs per months. If i go over my speeds get decreased to bellow dial up...

    I am also a big gamer... which isn't good for my cap, I play xbox live, steam games and other stuff.

    Usually by the end of the month I have acumumulated about 12 gigs in usage even with the cap in affect.

    So if anyone of you isp is reading this i just want to say, "up yours for making me play games at a limited speed and having me lag and fail at what im trying to accomplish"

    Now that thats outa the way, I'm going to download Left 4 Dead via steam client (which is 7 gig) and leave my computer on for about 2 days straight just to finish the download.


    reply to this | link to this | view in thread ]

  30. identicon
    Steve, May 3rd, 2009 @ 12:41pm

    Re: Caps... No one likes them

    I agree with the person above me who is a gamer. So am i and totaly going through the same thing as you.

    I hate playing call of duty 5 and getting so laggy because my speeds are capped that i can on get killed because im lagging to much.


    reply to this | link to this | view in thread ]

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