Comcast and Time Warner Cable, the two largest US incumbent cablecos, will this week begin testing different ways of handling the rapidly growing Web traffic on their networks. They want to provide the best possible service to every subscriber.
The matter of maximizing network usage by regulating usage streams has been controversial. Consumer groups and many government regulators have protested and questioned network management practices.
Broadband service has become a highly profitable business for cable operators. They want to retain subscribers but have to generate sufficient profits to keep upgrading their network infrastructure. The fact is that subscribers that do a lot of downloading and/or uploading eat up a lot of bandwidth, which causes subscribers with more normal usage to have their speeds slowed down.
Accessing data outside an operator’s network also causes extra bandwidth usage. Several broadband service providers have tested a P2P technology that Pando Networks developed to alleviate the problem caused by inter-network downloads.
Protestors espouse what is called Net Neutrality, under which the broadband service provider would not under any circumstance regulate traffic on its network, not even if it results in a superior performance for all subscribers as a group. It’s like saying there should be no traffic signals on streets where there are many intersections.
There was a start-up at The Cable Show that was pitching the use of their technology to create a higher tier of broadband services in which the ISP would cache content from popular sites such as YouTube so that those who paid for the top service would see faster downloads.
Cablecos’s broadband subscribers have to share their broadband pipe with their neighbors, which can also slow down Internet access. Comcast will this week begin testing limiting bandwidth in four cities for heavy Internet users during periods when network congestion is high.
Time Warner Cable will adopt an approach that is in use in Europe and Canada. It will meter new subscribers and charge them $1 per gigabyte for usage above a monthly allowance. Its test begins this week in Beaumont, Texas.
It’s sort of like a fixed price buffet but you have to pay more after eating several platefuls. “We realize this will require a cultural shift away from the all-you-can-eat model consumers have grown used to and we want to see what our customers’ response will be,” said Time Warner Cable spokesman Alex Dudley.
Comcast has not ruled out metered billing. It says it’s considering “consumption” billing plans. It currently prices by speed, not usage. Comcast said it is evaluating a monthly 250 GB limit for its heaviest usage subscribers but has not made a decision.
“We want to deliver the best online experience for our customers,” a Comcast spokesman said. “We can do it really quickly and without the need for government intervention.”
Broadband service providers have three choices, four if adding more and more bandwidth ad infinitum is considered.
– They can regulate traffic by its source such as slowing traffic from an illegal P2P site. That may not be as easy as it sounds because some technologies such as BitTorrent are used for both legal and illegal downloads.
– They can slow traffic to and from bandwidth hungry subscribers. Time Warner Cable says 5% of their subscribers account for 50% of the usage. Yet, they pay the same rate as those that use the network much less.
– They can charge heavy bandwidth users by their usage so-called metered billing just as water and electricity bills are based on usage as measured by a meter.
Most Net Neutrality partisans say the broadband service should not prioritize one type of Internet traffic over another. They say the service provider should prioritize all sources the same that is not to prioritize them at all.
“We want to find the most equitable way to deal with this issue,” Dudley said. Time Warner Cable said that setting the caps is “a very simple matter to change and easy to adjust as usage patterns change. The Federal Communications Commission is continuing its investigation of the matter.
In 2008’s first quarter, Canada’s Rogers began implementing usage-based billing that charges the subscribers for the number of gigabytes they down- and upload during a month.
The company said the purpose of the move is to make sure that a few users (5% the company said) don’t slow down the other 95% of subscribers’ broadband speeds by doing a lot of uploading and downloading.
Subscribers can monitor their usage and Rogers will send messages when a user approaches the monthly limits. Rogers intends to show users alerts on the Web page they are viewing. Rogers COO Nadir Mohamed said future broadband pricing will be based on “speed and usage,” not just speed.