A Comcast executive expects that within five years all Comcast customers will once again have monthly bandwidth caps imposed on their home broadband usage. But, Comcast Executive Vice President David Cohen said at the MoffettNathanson Media & Communications Summit in New York on Wednesday, most subscribers won't end up blasting through their bandwidth caps and paying more money every month.
From Comcast's point of view creating bandwidth caps is all about fairness. "People who use more should pay more and people who use less should pay less," Cohen said, as first reported by ArsTechnica. The alternative, from Cohen's point of view, is that prices for monthly Internet access rise for everyone, with light users subsidizing heavy users.
Comcast is currently running several pilot projects in select markets in the United States to test out its bandwidth caps. In one pilot project, Comcast allows people to choose several buckets that combine download speeds with bandwidth caps. The higher the speed you choose, the higher your bandwidth cap.
A second test, which Cohen suggests Comcast prefers, starts all users with a bucket of 300GB per month. The company charges $10 for every extra 50GB after that.
Comcast also offers what it calls a flexible-data option for low-use subscribers in select markets. The low-use plan gives subscribers a 5GB monthly cap and anyone who stays under that amount gets a $5 credit per month. Go over that 5GB allotment, however, and you're paying $1 per extra gigabyte. Unsurprisingly, Comcast customers haven't been thrilled with that particular offering.
A history of limitations
Comcast's bandwidth cap pilot projects have been ongoing since 2012, when the company suspended its nationwide 250GB data cap that first rolled out in 2008. Under the original plan, Comcast said it needed to institute a cap to better manage its network capacity.
The company also didn't provide an option for high-usage customers to pay more as it currently does in its trial markets. Instead, those who went over their limits were to receive warnings from the company, and customers with too many warnings could see their Comcast account suspended for a year. Comcast also experimented with bandwidth throttling for heavy users in 2009.
Needless to say, Comcast's nanny approach to Internet usage didn't go over well and the bandwidth cap was universally hated.
When it gave up on its universal 250GB bandwidth cap in 2012, Comcast said the reversal was only temporary and that caps would return.
Cohen's comments about a return to bandwidth caps, called usage-based pricing by the company, come as Comcast is trying to acquire broadband rival Time Warner Cable for $45.2 billion. The deal has yet to gain regulatory approval and has been subject to heavy criticism over fears it would give Comcast too much market power.