I’ve been following Om Malik as he writes about the upcoming metered, capped broadband that cable companies are starting to shift to in the US. Here’s a quote from an article that he posted recently:
Road Runner Standard package provides 7Mbps service and includes an Internet usage consumption allowance of 20GB per month. Although the initial 20GB plan is price locked, Internet usage above the consumption allowance is not and will be billed at $1 per GB per month.
That quote is especially important as it’s apparently buried in the small print of the service contract being offered in Texas. That’s pretty crappy given that consumers in the US have no expectation of overage charges. Basically no one does that in the consumer space.
What this does is turn the US broadband cable market into the cellular market. You’re never sure what that bill is going to look like at the end of the month because they very carefully do not inform you when you are getting close to your usage limits. (Ask the average consumer how they feel about “overage charges” and I’m sure you’re going to get an earful.)
There have been other articles that have talked about the other thing this does: It prevents people from using competing video services on the web without paying a tax to your Internet and Television provider. Attempts to route around the (new) false scarcity of TV cable service into the home become far far more expensive. Quality video requires bandwidth, bandwidth that is now metered to very low levels, which means that services that might (dare!) to compete with your cable companies other offerings are now stifled.
It also opens up an entire area of concern around what happens if you happen to own a machine that is hit with a virus and is used as a spam robot. Can you imagine getting a bill for thousands of dollars because your machine was hijacked and then being left with the responsibility of having to prove it wasn’t you? I can’t imagine those discussions in the consumer market. It’s going to be obscene.
And the last bit that makes up the title for this post. At 20GB/month that’s an average speed of 66kbps – just slightly higher than dialup speeds. We might need some underground re-marketing on this one.
