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Comcast to cap customers’ Internet use

Dan Grech Aug 29, 2008

Comcast to cap customers’ Internet use

Dan Grech Aug 29, 2008


KAI RYSSDAL: The country’s biggest cable company did something remarkable today. Comcast set an official limit on how much data its customers can transfer — 250 gigabytes a month is the formal cap. For a little context here, that’s about a hundred times what the average Comcast subscriber uses. And once the policy takes effect in October, customers who top that limit could have their service suspended if they don’t change their ways.

But Marketplace’s Dan Grech explains the cap isn’t really about the Internet anyway. It’s about television.

DAN GRECH: How much is 250 gigabytes? It’s about 50 million e-mails, 62,000 songs, 25,000 photos.

In other words, far more bandwidth than the average Web surfer currently uses. Comcast says it enacted the cap to weed out excessive users.

Derek Turner is with Free Press, a nonprofit that has complained to the FCC about the way Comcast manages its network.

He says the cap is really the cable company’s response to high-definition video over the Internet.

DEREK TURNER: That is a direct threat to Comcast’s core business model and their core cash cow, which is delivering video.

Two hundred-fifty gigs translates to downloading just 25 HD movies. Turner says Comcast capping Internet use is a case of the fox guarding the hen house.

TURNER: The same pipe they use to deliver video is used to deliver Internet. And as more and more content is available online, customers are quickly going to realize they don’t need to pay cable companies $100 a month to get their video content.

Comcast would not make any officials available on air.

Om Malik writes the influential tech blog GigaOm.com. He says the era of a flat fee for unlimited Internet use may be coming to an end.

OM MALIK: It is going to encourage other broadband providers to do what Comcast is doing.

Time Warner Cable, the nation’s second-largest cable operator, is testing a system that charges Internet subscribers based on use.

I’m Dan Grech for Marketplace.

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