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ACA claims metered pricing is the only sustainable pricing model

Consumers continue to be outraged when cable companies try and move from flat fee models for internet access to tiered pricing plans based on usage. Early dial-up ISPs tried the pay per usage plan and found across the board that unlimited usage scenarios were much more popular with customers.

Today, broadband connections around the country for the most part are unlimited and users can download as much content as they want (in theory). The reality is that most ISPs today already attempt to throttle users who use what is deemed excessive bandwidth. At the same time, many ISPs are pushing new tired pricing plans that force users to pay significant fees for each gigabyte of data downloaded or transferred after what are typically very low monthly allotments of bandwidth.

Time Warner was the most recent large ISP to announce trials of tiered pricing that would have seen customers paying $150 per month for unlimited bandwidth as opposed to the roughly $40 per month an unlimited plan costs today. The outrage from customers and lawmakers was much stronger than Time Warner had anticipated and the company announced that it would be dropping its tiered Internet pricing plans for now.

According to the American Cable Association (ACA), metered bandwidth Internet pricing is coming and will be a necessity. According to Patrick Knorr of the ACA, his company, Sunflower Broadband, is already charging customers metered rates for internet access and has been doing so for several years.

The ACA argues that metered pricing is going to be a necessity as demand for bandwidth increases with the adoption of high-bandwidth video services. According to ACA chair Steve Friedman, the metered charges are not intended to inhibit content, but to ensure quality of service for all customers using the service. Friedman says he isn’t sure that Time Warner did a good job explaining that. That rationale is the same used by cable companies when they tried to block certain types of content with the claim that it was to prevent piracy and offer quality service to all users.

ACA President Matt Polka says that while metered internet is in early development, that outcome is certain. Polka claims that there is no limit to the build-outs that ACA members have to do to meet customer demand and with new services coming ACA member simply won't be able to support all of that at $40 per month.

Polka likens internet usage to his heating bill saying that he would like to pay the same amount year round, but in the winter when he uses more, he has to pay more. If Polka's heating company suddenly decided that he was only allowed 4 cubic feet of gas before an overage charge of $2 per cubic foot was assessed to support the need to install more gas pipelines to "ensure quality service," he might feel like the majority of Internet subscribers do.

Knorr insists that bandwidth-based billing is the only way to manage infrastructure and that it is simply a case of raw math that the infrastructure to accommodate the growth in HD downloads isn’t there at this point. He continues saying that the only way to rationalize a business model is to put some of the responsibility on the subscriber.

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RE: Lol Wut ?
By Bateluer on 4/29/2009 11:19:31 AM , Rating: 5
Except any small ISP that attempts to start will either need A) Money to lay their own fiber or B) use existing lines, which will carry heavy fees from the cable companies.

RE: Lol Wut ?
By StevoLincolnite on 4/29/2009 11:33:00 AM , Rating: 2
That's easy fixed, get your government to structurally separate your ISP's wholesale and Fiber Networks, expand the network so it will have more coverage, introduce P2P caching and P2P de-prioritization, set a low access price for all ISP's so that they have equal access then let competition drive down prices.

P2P caching has the benefit of reducing the cost of data for the ISP as that data wont have to be downloaded as many times by the users, hence reducing costs, P2P de-prioritization basically allows services such as FTP, HTTP services to gain priority.

RE: Lol Wut ?
By mondo1234 on 4/29/2009 12:11:50 PM , Rating: 5
Some cities are putting wireless routers on the power poles and traffic lights, the rest is handled by the municipality.
If they are going for tiered pricing, then I want to not only block pop-ups, but also flash advertising, and pop-up surveys. I should have the right to choose what comes over the wire to my browser and pay the bandwith for it.

RE: Lol Wut ?
By FITCamaro on 4/29/2009 12:40:57 PM , Rating: 5
Good point. All that crap will use up your bandwidth without you having a desire to actually see it.

RE: Lol Wut ?
By DopeFishhh on 4/30/2009 5:07:25 AM , Rating: 2
Yes and so will a lot of other things like say ping floods or windows/virus updates.

An ISP would be able to reduce their costs by caching things like updates for programs or providing internal sources for things on the net and making sure users are aware of them. That way they pay once for a download and multiply it on their end, IE proxy servers.

RE: Lol Wut ?
By inperfectdarkness on 4/29/2009 12:58:31 PM , Rating: 4
deserves a 6.

the next step is that advertisers & companies that rely on advertising are going to pitch a royal fit because their marketing is being blocked.

in the end, it's all a giant conspiracy to f#$k the consumer.

RE: Lol Wut ?
By RjBass on 4/30/2009 12:30:48 AM , Rating: 1
Good point, but I just run IPCOP and that takes care of all that. However the average home user isn't fluent enough with Linux or more advanced routing to understand how IPCOP works, so for them I would have to say that the customers need to have much better control over what they get online.

Excellent point sir, your post deserves a 6.

RE: Lol Wut ?
By greylica on 4/30/2009 10:58:13 AM , Rating: 2
Deserves 7.
Firefox have a great tool to block these poppy bandwidth eaters, then, instead of MSN, Use amsn ( without the poppy bandwidth s***k advertisers ).
ANNNND The bots, the insects that travel the net, and finnaly, those droned cookies, when I read a page, normally there are thousands of loads of dinamic.everything, advertising#$##.$%&$, truncated sites, truncated advertising, packet analysis, that advertising companies install...
Start to block them, the spammers and the virus sites and you will have 20% more bandwidth.

But to solve, reaaly solve, there is only one way:


RE: Lol Wut ?
By grandpope on 4/30/2009 11:41:05 AM , Rating: 2
OK, I gotta ask, WTF does "s***k" stand for? I have exhausted my fairly considerable index of swear words and i got nuthin.

RE: Lol Wut ?
By acase on 4/30/2009 12:10:37 PM , Rating: 2
all i got is skank, and that is hardly worth censoring

RE: Lol Wut ?
By MozeeToby on 4/29/2009 1:29:57 PM , Rating: 5
Firefox + adblock + auto updateder for the adblock list.

I haven't seen an ad on my home computer in literally years. I'm stuck with IE7 at work unfortunatly.

RE: Lol Wut ?
By therealnickdanger on 4/29/2009 2:37:01 PM , Rating: 3
Yup, all I use is a regularly updated HOSTS file and PG2 and IE8. It blocks everything unrelated to what I want to see and do.

RE: Lol Wut ?
By ZeroGuardian on 4/29/2009 5:42:30 PM , Rating: 4
Firefox + adblock + auto updateder for the adblock list.

The problem with this is that the ads and so forth still come through your connection. It is only at the local computer that all the content is filtered out. So while you don't see the ads they still use up bandwidth. Same with editing your HOSTS file. The only true way to resolve this problem is for the ISPs to either filter it out or make the ads not count towards your total bandwidth.

RE: Lol Wut ?
By tfk11 on 4/29/2009 8:19:01 PM , Rating: 4
The problem with this is that the ads and so forth still come through your connection

Not true. Each webpage is composed of many separate files referenced by the initially requested page. Both adblock and the hosts file prevent referenced files that are deemed to contain adds from being requested which does save bandwidth.

In the case of the hosts file the browser still sends the request but it is redirected to an address where the content cannot be found causing the request to fail.

RE: Lol Wut ?
By bobdelt on 4/29/09, Rating: 0
RE: Lol Wut ?
By xti on 4/30/2009 12:16:12 PM , Rating: 2
yeah people. if u gonna look at porn, be proud. dun be all 'wahn the virus took my comp before climax'.

RE: Lol Wut ?
By Oregonian2 on 4/29/2009 2:44:15 PM , Rating: 2
Portland is one of those cities, and I think one of the last to "drop out" of it. The ad driven city-wide wifi was profitable in terms of operational runtime costs, but like skype was for eBay -- it would have taken "forever" to make back the capital costs. So the company putting it in refused to finish the project unless the city ponied up money -- which they refused to do. So it came to an end. Don't know if they've removed the already installed stuff. One problem is that it wasn't 'n', and the pre-'n' wifi had limited range, particularly in terms of penetrating buildings/homes for internal antenna w/o boosters. 'N' might have worked better but STILL isn't an approved standard yet. :-)

WiMax would be perhaps a more realistic alternative in terms of putting in the infrastructure from scratch (by those with less capital like Verizon putting in FiOS). now has my metro area covered I understand from their wimax commercials on TV.

I want to see if cable companies having the new price schedules do so in areas that have FiOS available (I'm delighted with FiOS with no urge of using Comcast that's in our area).

RE: Lol Wut ?
By Kenenniah on 5/1/2009 6:57:42 AM , Rating: 2
Actually I would say the people who are creating and making that website available to you for free should be able determine what they have on their website. Let's face it, you choose to go to that website they don't force it on you.

If blocking of all ads became widespread just what do you think would happen to all those websites you go to? Right now with relatively few people using ad blockers it's not a problem. If it ever becomes widespread though, do you think those companies are going to keep running websites and paying developers for no revenue? If ad blocking becomes widespread enough, the majority of "free" websites will disappear and we'll be left with mostly fee based subscription sites.

RE: Lol Wut ?
By Murloc on 4/29/2009 1:22:56 PM , Rating: 2
they have the money and the power, no one will do that.

RE: Lol Wut ?
By vapore0n on 4/29/2009 4:07:22 PM , Rating: 2
While P2P caching is great in concept, reality is that it's a really bad idea. If they cache illegal content, that there makes them liable. Then you would have ISPs monitoring your habits and probably reporting them regardless of what you do, just so they can wash their hands.

Need to keep net neutrality and privacy.

RE: Lol Wut ?
By dragonbif on 4/29/2009 2:14:31 PM , Rating: 2
Even if you lay your own lines down you still have to pay for the space/poles. The cost is high and the gov loves to tax the hell out of internet use just look at your last bill. About $9 of my $42 bill is tax from the local, state and federal. The more you pay the more tax you pay.
Also the ISP has to pay fees to the city/county, state, their SP, and whoever owns the land/poles that their cable goes over.
In order to lower our cost they need to lower their own costs and I just do not see that.

RE: Lol Wut ?
By marvdmartian on 4/29/2009 3:52:08 PM , Rating: 3
Then the govt steps in and does like they did with the power companies here in TX. TXU had to separate their power distribution from their power production, then offer the distribution at a fair and equitable price to any company that wanted to become a power provider. The lines are still maintained, and people have true competition, and thus, lower prices, for their power. Personally, I went from $0.18/KWhr with TXU, to $0.12/KWhr with Stream Energy, overnight. Really broke the stranglehold that TXU had on energy here.

I'd love to see them do that to all the big cable companies. Then see what sort of pricing we'd get from TWC.

"What would I do? I'd shut it down and give the money back to the shareholders." -- Michael Dell, after being asked what to do with Apple Computer in 1997
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