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The real reason ISPs want usage caps

Discussion in 'Bits & Bytes' started by Biker, May 18, 2011.

  1. Biker

    Biker Administrator Staff Member

    The large ISPs are running scared and the users are going to end up losing in the long run. Netflix now accounts for almost 30% of prime time downstream traffic in North America and estimates show that it may be 55-60% by the end of the year.

    ISPs don't like this, especially the larger conglomerates like Comcast, Time Warner and AT&T where Netflix is competing against their own Pay Per View offerings. Instead of developing a competing model, ISPs take the easy way out by imposing usage caps designed to limit the amount of bandwidth a user can use each month.

    Some of these caps are draconian. In Canada, the caps are so low that Netflix has changed the streaming model to low resolution formats so users don't go over their caps. Rogers, for example, has usage caps ranging from 2GB to 175GB per month depending on the speed of service you have. AT&T recently changed their caps to 150GB on their DSL service and 250GB on the U-Verse service.

    Most of these providers will tell you that they just don't have the infrastructure to handle unlimited traffic for all users. What they're really saying is it's bad enough they have to compete with other companies for Internet service, but they're terrified of Netflix and refuse to play on a level playing field when it comes to pricing. So, what do they do? They impose usage caps in the hopes that you'll use THEIR service which won't count towards your Internet usage (and is more expensive!).

    Unfortunately, the government isn't going to step up to the plate anytime soon and level the playing field. The FCC has made a couple of attempts, one of which was smacked down by the courts and the second attempt will most likely be killed by the partisan politics in Washington. In both cases, the consumer loses.

    ISPs are fighting tooth and nail to prevent any rules that would force them to straighten up. They'll claim that usage caps are the norm in the rest of the world (it's not), or they'll try to claim that a few bandwidth hogs who are using P2P are ruining it for everyone else (again, false false false). Nobody has taken them to task to prove their claims with numbers, and of course the media (controlled by the same companies who provide your Internet service), perpetuate the lies.

    In Canada, the CRTC has traditionally given free reign to the providers to do what they want. The laws that prohibit foreign firms from starting companies there have enabled the ISP providers to create a stranglehold on the entire country. There are rumors that the new Conservative government may work on killing those laws, which may provide the relief that Canadian users so desperately need.

    In the US, the FCC has been hamstrung by the courts and Congress. And while there have been legitimate complaints about the agency, they also have been caught in the crossfire because they don't have the authority to do what needs to be done. Every time they make noises about net neutrality, Congress gets its back up and threatens to neuter the agency even further.

    Unfortunately, until users get off their ass and tell their providers that this is unacceptable, we will continue to see lower caps that will try to force the competition out. Although if past history is any example, the apathy that most residents display when it comes to things like this will doom us all.
    1 person likes this.
  2. jimeez

    jimeez Thread Killer

    The average ISP customer knows nothing about any of this, therefore does not care. However, let's say one did care. What are our options? For most an alternative provider isn't even available. I can hear the conversation now if I would call Comcast and tell them, "I won't stand for this and your bandwidth caps are unacceptable". I'm sure they'd be happy to tell me what I can do with my opinion.

    Great post though.
  3. Biker

    Biker Administrator Staff Member

    What do you think Comcast would do if the majority of their customers started to complain, and then the media started airing those complaints? Especially when the complaints show that they're doing this to prevent a competitor from eating into their profits?
  4. jimeez

    jimeez Thread Killer

    Not gonna happen. I agree it needs to happen. But I seriously doubt enough people will catch onto this and raise hell. As long as they can access Facebook 24/7 and not miss any episodes of Dancing With the Stars, they'll remain as complacent as ever.
  5. Misu

    Misu Hey, I saw that.

    I think if Netflix gains even more in popularity, as well as other big bandwidth-consuming things like streaming music services (especially if Apple opens up a streaming subscription-based service as has been the rumors), then people will start caring. As it stands right now, I don't think its that people don't care so much as it isn't an issue that is affecting them.

    I don't know a single person who rents the digital offerings from their cable companies outside of a pay-per-view event. My cable provider chargers something like 3.99 or 4.99 for a 12 hour rental window for a movie. Netflix is 10 bucks a month for 1 dvd out and unlimited movie watching. For me, it doesn't make sense to pay 4 or 5 bucks for a 12-hour window to watch a movie, when for a little more, I get so much more service. So the cable companies really aren't looking at the big picture.

    Now, if the cable company were to offer their own netflix-like service, for a comparable price, that wouldn't affect usage caps, that would be an offer willing to consider. But they aren't. They want to charge ridiculous fees. They will lose this one, especially if Apple enters the game.
  6. Biker

    Biker Administrator Staff Member

  7. Biker

    Biker Administrator Staff Member

    Netflix CEO, Reed Hastings isn't very happy with Comcast and their blatant attempts to steer users towards their own streaming service.

    And of course, not a peep out of Comcast. Seriously, data caps need to go. Now.
  8. ethics

    ethics Pomp-Dumpster Staff Member

    FCC should be all over this. Where's the Feds like they were when MS including and embedded only one internet browser and even THAT was nothing in comparison to this.
  9. Biker

    Biker Administrator Staff Member

    As I stated in the original post, the FCC is pretty much screwed as well. They've made two attempts to level the playing field. One was smacked down by the courts, and the second was quietly dropped after Congress threatened to remove even more teeth from the agency.
  10. Biker

    Biker Administrator Staff Member

    Welp, the cat's out of the bag so to speak.

    And as we've all known, it's pure greed.

    Broadband CEOs Admit Usage Caps Are Nothing More Than A Toll On Uncompetitive Markets | Techdirt

    One would hope that the FCC sees this and rakes the greedy bastards over the coals.
  11. jimeez

    jimeez Thread Killer

    The FCC ain't gonna do jack shit. Who do you think controls the FCC? Independent agency my ass!

    Meh, I'm just getting old and cynical I guess.
  12. Biker

    Biker Administrator Staff Member

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