"New customers in Beaumont are put on metered plans automatically, while existing Beaumont customers are lured into the metered fold via some fine print trickery. Customers are promised twelve month price-lock guarantees, provided they sign a new contract. But the contract fine print holds some surprises: customers previously on unlimited plans are promised "guaranteed savings," only to find out they're now facing a $150 ETF, low caps, and $1/GB overage penalties." source

In their justification of caps in the first place, TWC said that only 14% of users in Beaumont went over their cap. Is it really necessary to cap a service when only 14% of the users were causing the problems to begin with? To put the caps in perspective, If you watch about 7 hours a week of standard-def video, or 2.5 hours a week of hi-def Web video, you could easily pass even the 40 GB cap. Judging on the future of the internet, we should be increasing bandwidth (a la Verizon Fios) to prepare for more consumption, not hinging on a premise that consumption is bad. We rank 19th in Global Broadband Penetration and our average bandwidth is 3.9 Mbps downstream, ranked 17th in the world, the time for growth is here, conservatism be darned.

Metered Billing is Hard to Track

I guess I appeal to the frozen hearts at TWC that may have beat red blood sometime in the last decade before corporate greed pulled the plug and made their blood flow dark green instead.

TWC often compares the use of overage billing to that of the cell phone company. You pay for a certain amount of minutes per month, and get charged for each minute over the set amount, as parents of adolecent teens are well aware. Don't even get me started on text messaging economics of 1MB for $1,310.72, you can find that here. The reference point everyone understands here is minutes of time, or even number of text messages of equal size. 83% of consumers polled in a study didn't even know what a gigabyte was or had any idea how many gigabytes they use! Why is this? Although we have a conception of a time or numbering system, the internet was built with bandwidth limitations in mind and as technology progressed, these limitations went away as most of the web became seamlessly accessible to anyone above a 56k modem connection. The only consumers aware of what a gigabyte was were those who downloaded large files (4GB or so, you know who you are) who frequently reached their bandwidth cap.

The web was built around bandwidth, not consumption capacity. That's why it's hard to meter usage on the internet when streaming a 2.5 hour HD video on the internet could net you 40GB of usage. Retooling the web to show the number of gigabytes in each video stream you watch, is asinine and a detriment to our technological advancement as a nation. For a nation that invented the internet, we sure are going about perfecting it the wrong way.

Overconsumption Should be Superfluous

I pay $45 a month for a medium tier of service from TWC through Roadrunner. It currently provides 5-6 Mbps of bandwidth. However, as mentioned above, cable companies like TWC expanded the reach of their networks without properly upgrading services to be able to provide this theoretical 5-6 Mbps of bandwidth to every customer who uses that tier. They go on the assumption that approximately 85 or 90% of the time spent online is loading webpages with little to no multimedia content. Thus, the available capacity TWC installs in a neighborhood, is not the maximum capacity if everyone gets a premium high speed tier, but the minimum expected capacity if everyone loads spartan webpages with no multimedia content, yielding a bandwidth consumption that is always under even the smallest tier. If consumers would simply get what they pay for from TWC, there would be no overages needed since it's included in the price of the contract.

No Foreseen Capacity Upgrades to Add Value to Increased Pricing

You get what you pay for right? Problem is, by adding overage charges to a monthly bill based on a threat of no available bandwidth capacity, TWC is stating they have a problem with bandwidth capacity. What are they doing to fix it? Not much. TWC plans to 'surgically' roll out DOCSIS 3.0 (increasing speeds up to 160 Mbps) in areas where there is competition (notably from Verizon). Areas with no competition from non-DSL high speed offerings (coincidentally, my market) will have to eat these overage charges or be forced to downgrade their internet connection to DSL.

Costs of Overage Charges

TWC plans on charging $1 per gigabyte of overage charges in these metered billing plans. Problem is, this is way out of line with any current offerings for webhosting on the market. Dreamhost charges $8 per month for 1000 gigabytes, roughly 0.08 cents per gigabyte. Amazon's S3 service charges 20 cents per gigabyte. Something doesn't make sense here.

The Evils of Metered Billing

We meter valuable resource usage like gas, electricity, and water without sweating bullets about it. Unlimited Voice and Data plans for cellular technology are on the horizon with the advent of better and more robust bandwidth delivery capabilities. Cable is stuck in the stone age and faces extinction like the dinosaur before it, Phone Lines. Companies operating on the cutting edge of technology are forced to innovate or fall by the wayside... the dot-com boom and bustle of the Silicon Valley is the atmosphere that pervades the data delivery industry, upgrade or die is the new mantra. Cellphones were safe until they started to provide smart phones and data plans. Cable companies were fine as long as they didn't dabble into the ISP business. The Internet Video era is upon us, TV is dying and many casualties have been foretold. There's an insatiable hunger that pervades the internet and right now all my eggs are in TWC's tiny basket.

Come and save me FIOS, please.

Eric Zuniga

Sources:
http://www.dslreports.com/shownews/91047
http://www.dslreports.com/shownews/Internet-Responds-Badly-To-Time-Warner-Cable-Metered-Plan-101711
http://twitter.com/AlexTWC
http://www.philsteinmeyer.com/73/bandwidth-costs/

You can send feedback to realideas@twcable.com if you wish to give Time Warner Cable a piece of your mind.