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Time Warner Cable's usage meter.
Time Warner Cable today relaunched usage-based billing, offering customers a $5 monthly discount off Internet access when they confine their usage to a maximum of 5GB per month.
Stop the Cap! was at the forefront of protesting Time Warner’s last Internet Overcharging experiment in 2009, which would have allowed unlimited access for $150 a month — a major rate increase to be sure. Other customers had usage allowances that originally would have ranged from 40-60GB per month, with overlimit fees of $1/GB or more.
Time Warner Cable’s Jeff Simmermon, director of digital communications, admitted the 2009 experiment attempted in Beaumont, San Antonio, and Austin, Texas, Greensboro/Triad, N.C., and Rochester, N.Y. was unsuccessful.
“Yes, we did try this before, a few years ago,” Simmermon said. “And yes, pretty much everyone agrees that it didn’t go so well. So we listened to customer complaints. A lot.”
The cable company is trying again in southern Texas, including the cities of San Antonio, Laredo, Corpus Christi, the Rio Grande Valley and the Border Corridor.
This time Simmermon says the usage-based pricing program for Time Warner Cable customers will be optional. He also promised Time Warner Cable customers will always have access to unlimited broadband at a flat monthly rate.
This is a major change for the cable company, because earlier statements from both CEO Glenn Britt and the chief financial officer Irene Esteves called usage based billing inevitable.
Simmermon admitted Time Warner Cable is making plenty of money selling unlimited access to customers today.
Simmermon
“We profit from unlimited consumption, and a free, open Internet is the sort of Internet that has gotten us this far,” Simmermon wrote on the company’s blog.
“All participation in the Essentials plan is opt-in, with the opportunity to save a few dollars each month,” Simmermon said. “It’s not going to be for everybody, and that’s fine — all Time Warner Cable customers will still have the option of selection an unlimited broadband plan.”
The details:
1) Up to 5GB/month of data transmission for a $5/month discount from one’s current monthly bill. All Standard, Basic and Lite broadband customers will be eligible. Turbo, Extreme and Wideband customers will continue as always, with access to unlimited broadband and no optional tiered plan or discounts.
2) The ability to opt-in and opt-out of a tiered package at any time.
3) A “meter” that tracks usage on a daily, monthly, weekly or even hourly basis, enabling customers to accurately gauge usage.
3) A 60 day/2 billing-cycle grace period to allow customers to adjust usage patterns. During this time the company will notify customers of overages but won’t charge for them.
4) Overages will cost $1 per GB, not to exceed a maximum of $25/month.
This presents the opportunity to save $5/month from a monthly broadband bill.
Time Warner already has the TV Essentials plan for $39.99/month that offers low-income households to have access to cable, in a stripped down package. Simmermon says this is meant to be the broadband equivalent.
[Stop the Cap! will publish our own views on this development in a separate editorial.]
Other stories of interest:
- Time Warner Cable CFO Wants to Introduce Usage-Based Pricing “The Right Way”
- Time Warner Cable Tries to Control Online Video Onslaught With iPad App to Manage Your Cable TV
- Time Warner Cable CEO Reports Basic Cable Suffers While Broadband Gains, Still Thinks ‘Usage Based Pricing’ is the Future
- BREAKING NEWS: TW Questioned on Usage Based Pricing
- ‘HBO/Max Go’ Online Video is Here for Some Time Warner Cable Customers
While Time Warner may have backed off for now on metered / capped usages, AT&T, Cox, Comcast and many other national ISPs are still restricting internet users access to the web. AT&T has a monthly 150gb cap on their DSL plans in many areas across the U.S. To this end, please see my petition to stop data capping on Change.org: http://www.change.org/petitions/stop-data-capping
If TWC goes through with this data limitin cap, they’re gonna lose me as a customer! I’ll cancel my internet before anyone could think of messing with my speed of data downloads/uploads. I’m not signing or agreeing to anything, period. Most other blind users would support me, I would think.
Hey Phil, just as predicted, THEY’RE BACK! >:(
I’d hate to see these data limits come to Buffalo. They recently boosted speeds on Lite and Basic from 768kbps/128kbps and 1.5Mbps/384kbps to 1Mbps/1Mbps and 3Mbps/1Mbps respectively. If they’re doing something like that they shouldn’t be even toying with data limits. $5 for 5GB of usage is terrible, and the overages are essentially to the point where going over would just push you into a price range past the typical Unmetered usage plan or past even the unmetered Turbo plan (which also runs at 20Mbps/2Mbps in Buffalo now).
Anyways, I guess we know what to do! The 5GB monster is too old, too little. Too AOL’ish for me to even remotely consider it as appropriate.
I knew they would be back. I have to say if Time Warner stays true to their word and keeps unlimited (at the same price as it is now), I will have a much more positive view about the company.
I really do respect Simmermon coming out and saying the company is making plenty of money selling unlimited access and they value what customers have said about wanting to keep that option.
They are certainly better than take it or leave it – we don’t care AT&T.
I agree that 5GB a month is really silly and the customers looking for that $5 discount are risking a lot if they don’t monitor their usage. I just don’t see who is going to sign up for this. Those that use the Internet the least probably are also least able to discern what a GB is. TV Essentials, the stripped down basic package, is also not exactly burning up their phone lines with people waiting to order.
There’s some caveats here.
A) they didnt say how much they would charge for that unlimited. This is a way Shaw got around looking completely evil in Canada, while everyone else was trying to force feed UBB, Shaw instead took the performance angle and said we can offer unlimited AND the best speeds in Canada but prices will be very high effectively building in the average recoupment booost from UBB into the price.
B) Reading between the lines, they’re clearly playing a game of averages here better that the people suckered into risking a greater overage for a measly $5 discount can give the the ARPU boost that might have come from gouging everyone else still on an unmetered plan. Essentially we’re hoping that the “light” users are gonna subsidise the revenue growth that Time Warner might be looking for.
Good work finding this.
w/netfilx i do 5GB per day. this is absurd as I pay $70 a month for time warner internet 30/5
5GB per month? Background noise data alone will eat that up.