Time Warner Revises, Defends Bandwidth Caps: 'Unlimited Usage at Turbo Speeds' $150 Per Month

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As it continues to field test metered bandwidth usage in the U.S., internet provider Time Warner has revised, detailed and defended its current and upcoming trials.

The revisions include a lower-priced entry plan and higher data caps. The company argues that tiered plans--in which customers have a set bandwidth limit and are charged if they go over--are necessary because "Internet demand is rising at a rate that could outpace capacity within a few years" and "could result in Internet brownouts."

Overage charges will be limited to $75 per month. "That means that for $150 per month customers could have virtually unlimited usage at Turbo speeds," said the company.

Time Warner is not alone in its hopes to bring the model, which is already used overseas, to the United States. Many worry about the impact this could have on gaming, especially as digital downloads and streaming services like OnLive gain popularity.

The company stressed that these are trials, adding "our plans will evolve as well and aren't set in stone" and that it looks "forward to more dialogue as we progress in these trials." An e-mail address was provided for that feedback, realideas@twcable.com.

The program rolls out to Rochester, N.Y., and Greensboro, N.C. in August, and will expand to San Antonio and Austin, TX in October. More details follow below, pulled directly from the company's official response to "the passionate feedback."

It will take a lot of money to fix the problem. Rather than raising prices on all customers or limiting usage, we think the fairest approach is to move to a tiered model in which users pay more if they use more.

If we don't act, consumers' Internet experience will suffer. Sitting still is not an option. That's why we're beginning the consumption based billing trials. It's important to stress that they are trials. The feedback we've received from our customers has been very helpful. We've made changes to the terms in our current and upcoming trial markets as follows:

  • To accommodate lighter Internet users and those who need a lower priced option, we are introducing a 1 GB per month tier offering speeds of 768 KB/128 KB for $15 per month. Overage charges will be $2 per GB per month. Our usage data show that about 30% of our customers use less than 1 GB per month.
  • We are increasing the bandwidth tier sizes included in all existing packages in the trial markets to 10, 20, 40 and 60 GB for Road Runner Lite, Basic, Standard and Turbo packages, respectively. Package prices will remain the same. Overage charges will be $1 per GB per month.
  • We will introduce a 100 GB Road Runner Turbo package for $75 per month (offering speeds of 10 MB/1 MB). Overage charges will be $1 per GB per month.
  • Overage charges will be capped at $75 per month. That means that for $150 per month customers could have virtually unlimited usage at Turbo speeds.
  • Once we implement this trial, we will not immediately start billing customers for overage. Rather, we will first provide two months of usage data. Then we will provide a one-month grace period in which overages will be noted on customers' bills, but they will not be charged. So, customers will have an opportunity to assess their usage and right-size their service packages before usage charges are applied.
  • Trials will begin in Rochester, N.Y., and Greensboro, N.C., in August. We will apply what we learn from these two markets when we launch trials in San Antonio and Austin, Texas, in October, but we will guarantee at least the same level of usage capacity in these trials.
  • As we launch DOCSIS 3.0 in the trial markets, we plan to offer a 50/5 MB speed tier for $99 per month.

Chris Faylor was previously a games journalist creating content at Shacknews.

From The Chatty
  • reply
    April 10, 2009 10:50 AM

    if the demand is going to be high within a few years, why not take the time to provide your customers with the supply?

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      April 10, 2009 10:52 AM

      "It will take a lot of money to fix the problem. Rather than raising prices on all customers or limiting usage, we think the fairest approach is to move to a tiered model in which users pay more if they use more."

      • reply
        April 10, 2009 11:05 AM

        without upgrading? it just seems very short sighted. internet use is not going peter off or stabilize probably ever unless there is some kind of catastrophe and millions of people die.

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        April 10, 2009 11:08 AM

        I don't have a problem with a tiered model, but it's still only masking the problem as they're overselling their service. Content on the Net is only getting larger (streaming movies, downloading of games, etc) and they aren't preparing adequately for this. One thing I don't like about this tiered approach is that it wasn't something I signed up for. The ISPs change their service plans whenever they like without any repercussions. I signed up for unlimited service, now they've implemented a cap.

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          April 10, 2009 11:24 AM

          also they change shit like this on you and if yuo go to cancel and you're in a contract, you end up paying out the nose for disconnection.

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          April 10, 2009 11:24 AM

          Before you get too upset, you should re-read the Terms of Service document that you contractually consented to when signing up:

          "Upon effectiveness of any change to any of these documents, my continued use of the Services will constitute my consent to such change and my agreement to be bound by the terms of the document as so changed. If I do not agree to any such change, I will immediately stop using the Services and notify TWC that I am terminating my Services account."

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            April 10, 2009 11:59 AM

            I'm not with TW, but with Rogers up in Canada and I'm sure their contract has similar wording. It's still BS if you ask me though. I often wonder how legally binding such contracts are, how can a signed contract have any merit when one of the parties can change said contract whenever it suits them. I'd also have less of an issue with it if there was actually some competition in the industry.

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              April 10, 2009 12:11 PM

              I can certainly understand the sentiment. I would do whatever I could to avoid using TW if they were providing in my area as well. I'd also call their publicity office and let them know specifically why I won't use them or recommend them to anyone I know. And you are correct, there is definitely minimal competition in the ISP space, but there is DSL/Satellite/Wireless/Dial-up. They may not be the best alternatives, but they are choices and it comes down to how much you 'really' disagree with Time Warner's tiered plan.

              As regards to the contract, it has merit because as a signee, you have given consent to whatever may have been stated in that contract.

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                April 10, 2009 12:43 PM

                You're luck in the US as you have a little more competition. Up here you basically have two choices: Bell or Rogers. Both have similar contracts, not a whole lot of choice.

                re: contract: I understand what you're saying but a contract that can be changed at moments notice is no longer really a contract. The whole point of a contract is to establish terms and conditions that both parties agree to and will abide by. If one party does not have to abide by the terms then as far as I'm concerned it is not a contract in any sense of the word. Maybe it's just semantics but it irks me that they can do this.

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        April 10, 2009 11:30 AM

        Didn't the U.S. government give cable companies like $200 billion to upgrade their infrastructure in 1996?

        • reply
          April 10, 2009 1:08 PM

          Yep. Bonuses were mighty juicy for a couple years. At least we got fiber to the curb... oh.

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        April 10, 2009 12:46 PM

        TWC claims that the caps are needed to "make improvements to infrastructure" that are necessary for higher speed access, but it's hard to see how. Comcast is aggressively rolling out DOCSIS 3.0 upgrades across its service area. In Chicago, it already sells a 50Mbps plan for $139.95—only 56¢ per GB.

        Besides, the dirty secret of these DOCSIS 3.0 rollouts is that they're cheap. Cable companies need to upgrade hardware at the headend and may need to send out a new cable modem, but this is hardly expensive. A New York Times piece last week quoted industry insiders who said the job could be done for between $20 and $100 (the latter figure includes a new cable modem).


        From: Ars Technica - The price-gouging premiums of Time Warner Cable's data caps
        http://arstechnica.com/tech-policy/news/2009/04/the-price-gouging-premiums-of-time-warner-cables-data-caps.ars

    • reply
      April 10, 2009 11:56 AM

      What few realize is that EVERY ISP is using lines leased from good old Ma Bell. They are the reasons for increased pricing. Verizon is jacking up leasing costs as they slowly move their FIOS system into areas. They are truly upset over the fact that data transfer is a cheap commodity now. There was a time when it was not,(see dedicated lines circa late '90s) and they were rolling in scrooge mc'duck pools (not that they're hurting now mind you ) but Now that tech has caught up to their antiquated business models there is a scrambling to keep afloat in the new world order.

      There is no alternative other than the Feds taking ownership of the backbones.
      Yeah I know that sucks. There is not another option or else the almighty dollar WILL take over.

      Death to Capitalism, it is a great idea just like communism but fails to take the human influence of greed into account.

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