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Cable Companies to Change Pricing Strategy

By cupcake ·
I heard this on NPR last night, Time-Warner cable is testing price structure changes in some markets.

The idea is that they will start charging for broadband usage over a certain point. And this appears to be no small fees... for high consumption customers - think streaming video, movies, photo sharing and web hosting - the fees can range as high as $200 or more just for your internet portion of your cable bill.

Here's an excerpt from the article:

In the case of Time Warner Cable, customers will be charged from $29.95 to $54.90 a month, based on data consumption and desired connection speed. Customers will be charged $1 for each gigabyte (GB) over their plan's cap. Time Warner Cable offers four cap levels of 5, 10, 20, and 40 GB. A download of a high-definition movie typically eats up about 8 GB. A recent report from Sanford C. Bernstein suggests that a family on the 40 GB plan that streams 7.25 hours of online video a week (a fraction of the 60 hours Americans spend watching TV in a week) could end up spending $200 per month on broadband usage fees. And that's just for video viewing, before factoring in such Internet activities as music downloads and photo sharing. "To put it mildly," says Bernstein analyst Craig Moffett, "the decision to limit data consumption can be expected to have profound implications for [consumer] behavior."

You can read the full article at

How do you think this could affect you? I know I have five computers hooked up to Time-Warner's internet service with teen-aged boys playing online games, watching YouTube and online chatting. I, myself, host a web site, participate in social networking and genealogy research and more.

The real outrage, for me anyway, is that the technology to provide internet service is becoming less expensive all the time. Is this a case of greedy corporations looking to boost their sales numbers (and their overpriced bonuses)?

What do you think?

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First thing I thought about this

by boxfiddler Moderator In reply to Cable Companies to Change ...

is that the timing is damn poor. Which could be a boon over the long haul if it outrages enough customers.

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my thoughts....

by ---TK--- In reply to Cable Companies to Change ...

If TWC does do that I will drop their service and find a company that will not cap me! Although this isn't the first time I have heard this.... I doubt they will roll that out, or they will have "Unlimited Package"... kinda like their turbo package that allows 15 Megs down... Which I have and yet to fully utilize it. I torrent alot (open source OS's), and the highest download speeds that I have hit was 10 megs per sec....

Gezz lol if that was implemented (with out notifying me) I probably have a heart attack when the bill came in....

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after reading the article....

by ---TK--- In reply to my thoughts....

If that gets implemented in Cincy... I will find a different service provider... one that will not cap me!

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Not Good

by KSoniat In reply to Cable Companies to Change ...

Ironically I am in a rural area which does not even have cable so this will not affect me just yet.

We are actually trying to move, so could very well be affected - and if it flies here you know everyone else will jump on the "charge more" bandwagon.

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Two thoughts; one bad, one worse

by NotSoChiGuy In reply to Cable Companies to Change ...

Thought #1: This seems like a ploy by the cable companies to recoup the revenues they are losing from people turning off their premium services. Really, with all the available options to stream shows and movies, who really needs Showtime or HBO? Or Discovery Channel or SciFi, for that matter?? They're upset because their narrow vision didn't extend to entertainment becoming available en masse via the Net, and they're forced to catch up from behind in order to capitalize on it.

Thought #2: Given the current economic & political climate, I can see the day when broadband internet access is controlled by the government, in an effort to 'protect our citizens'. The headlines will read "Broadband Bailout for Citizens". A few more line splices, and a public outrage over pricing tiers will be all it takes. Sadly, it will be widely embraced if/when it happens.

Funny thing is that people have the power now to stop this: CANCEL THE SERVICE. Period. If enough people canceled the service, they'd roll back from the pricing tier plan.

The cable companies have three options: they can sell their service for a lot, they could sell it for a little, or they could not sell it at all. They want the first option, but will quickly retreat to the second if faced with the third.

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I have Comcast, not Time Warner

by DadsPad In reply to Cable Companies to Change ...

Comcast announced that they would be SLOWING down people's internet speed if they used too much bandwith.


So it is not just TWC that is doing something about this. At least, so far, they will not do extra charges. Although, I am sure, if TWC does do this, they will be right behind.

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by boxfiddler Moderator In reply to I have Comcast, not Time ...

if TWC does this successfully. If it costs them their ass, others won't plunge in. At least not for now. Eventually, one of them will try it again.


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Oh yeah, setting a standard for everyone.

by cupcake In reply to I have Comcast, not Time ...

If Time-Warner is successful, you can bet that other companies will follow suit.

My real complaint is that TW will only charge 'up' but not adjust my bill 'down'. I mean, what if I am on vacation during the summer and I use little to no bandwidth? Will they credit me for what I don't use? Not a chance.

They don't care about being fair, only how much they can squeeze out of their 'competition-less' markets.

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That's the best argument I've ever heard

by NickNielsen In reply to Cable Companies to Change ...

for outlawing franchise monopolies.

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Time Warner has a change of heart...

by cupcake In reply to Cable Companies to Change ...

Heard this last night on NPR:

Broadband internet provider Time Warner Cable seems to have caved slightly to the rising public sentiment against their plans to charge its subscribers for the amount of bandwidth they use.

Read the whole update here:


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