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Data Cap Vendor Shows Off “Revenue Accelerator,” Helping Cable Companies Monetize Usage

Phillip Dampier July 24, 2018 Consumer News, Data Caps, Net Neutrality No Comments

OpenVault’s technology can automatically slow down “abusers” who use too much internet service.

Cable companies looking for ways to raise prices for their broadband services without spending money on network upgrades may be interested in OpenVault’s “Revenue Accelerator” — a cloud based internet usage measurement system that can help push subscribers into higher priced tiers or warn them when they are about to face punitive overlimit fees for exceeding their monthly usage allowance.

OpenVault’s goal is to monetize customers’ internet usage, making cable operators certain each customer is paying as much as possible for internet service without facing customer-displeasing overlimit fees from exceeding their monthly usage allowance.

“All these solutions are designed really to do of a couple things,” said OpenVault CEO and founder Mark Trudeau, in an interview with FierceTelecom. “One is to drive incremental revenues, and two is to drive costs [for cable operators] down, all with the idea of increasing profit for cable operators.”

OpenVault will collect customers’ usage behaviors, reporting back every 15 minutes how much bandwidth each customer is using, as well as enforcing cable company policies to automatically slow down “abusers” who are sending and receiving more than their fair share of data. Enforced network management, built into the platform, can automatically punish customers based on violations of the ISP’s Acceptable Use Policies. Usage violators are then reported to the cable operator, targeted for future marketing campaigns to upgrade their service to a more expensive tier to avoid further time-outs on the internet slow lane.

The technology is cheap to deploy, relying on a set of command lines inserted into cable modem termination systems that collect Internet Protocol Detail Record data and send it on to OpenVault.

“We measure all that for the operators and then what our Revenue Accelerator product does is it helps them micro-target their upgrade candidates,” Trudeau said. “This can have just really massive impacts on their revenues, to be able to truly not just micro-target the upgrade candidates, but also provide their reps with the ammunition they need and the visibility they need into their customer’s behavior and into their homes so they can intelligently talk to a subscriber.”

OpenVault claims the implementation of usage based billing and data caps are immediate money-makers for operators, both from current customers forced to upgrade to avoid the cap and from overall usage billing that delivers an immediate payday to cable operators without having to invest in expensive upgrades or service improvements.

“In real-number terms, evidence shows an immediate return as some OpenVault customers have enjoyed as much as seven percent of subscribers upgrading their service within 90 days of usage based billing deployment,” the company wrote on its blog. “For some operators, this translates into increased ARPU (average revenue per unit) of over $5 per subscriber per month. OpenVault customers that have deployed usage based billing have experienced increased ARPU ranging from $1.50 up to $12 per subscriber per month.”

Comcast Dumps Congestion Management System It Says Was Unused for a Year

Image courtesy: cobalt123Comcast has quietly dropped its internet congestion management system, designed to slow down its heaviest users, claiming it has gone unused for more than a year and was no longer needed.

Originally spotted by readers of DSL Reports, the announcement referenced the system that replaced Comcast’s speed throttle that intentionally degraded peer-to-peer network traffic after Comcast claimed it was unfairly impacting its other customers:

As reflected in a June 11, 2018 update to our XFINITY Internet Broadband Disclosures, the congestion management system that was initially deployed in 2008 has been deactivated. As our network technologies and usage of the network continue to evolve, we reserve the right to implement a new congestion management system if necessary in the performance of reasonable network management and in order to maintain a good broadband Internet access service experience for our customers, and will provide updates here as well as other locations if a new system is implemented.

Comcast’s “protocol-agnostic” network management technology, designed by Sandvine and introduced in 2008, measured customer traffic and singled out heavy users for speed reductions when Comcast’s network was saturated with traffic. Customers were unaware if they were deemed heavy users or if their traffic was targeted for temporary speed reductions. Comcast relied on the technology, along with the introduction of a 250 GB nationwide data cap, to control network traffic and stall the need for expensive node-split upgrades.

Comcast claims the introduction of DOCSIS 3.0 (starting in late 2008) and DOCSIS 3.1 (2017) gradually eliminated the need to maintain the congestion management system, because channel bonding vastly expanded available internet bandwidth. What remains in place in most Comcast service areas is Comcast’s controversial 1 TB usage cap. The company initially claimed its data caps were part of a network traffic management strategy, but more recently the company claims it collects more from heavy users to compensate for its broadband investments.

Spectrum Ditching Usage Measurement Meter Tool in July; Usage Caps Not in the Cards

Charter Communications is abandoning any pretense of data caps on its internet service by decommissioning its internet usage measurement tool for residential subscribers effective this July.

Company officials began notifying customers in billing statements that the usage measurement tool will be dropped effective next month. Charter Communications markets Spectrum internet service as free of any data caps, and a usage measurement system only confused customers about whether their internet usage was truly unlimited.

Originally introduced by Time Warner Cable in late 2009 and gradually made available to customers nationwide, the usage measurement tool reported monthly data usage for customers as part of Time Warner Cable’s original 2008 market test of data caps in Beaumont, Tex.

Customers were offered a Lite Tier with a 5 GB monthly cap or 40 GB of usage for the company’s Turbo Tier. Overlimit fees were $1/GB.

The company attempted to expand its data cap trial in the spring of 2009 to customers in Austin and San Antonio, Tex., Rochester, N.Y., and the Triad region of North Carolina. A major backlash, organized in part by Stop the Cap!, resulted in those market trials being abandoned within two weeks of being announced.

Time Warner Cable never attempted to impose compulsory data caps again after its disastrous 2009 trial and Charter Communications quietly abandoned its own frequently unenforced usage caps in 2015, shortly before bidding to acquire Time Warner Cable and Bright House Networks.

By ditching the usage measurement tool, Spectrum will retire the last remaining elements of Time Warner Cable’s legacy of dabbling with usage caps and further monetizing internet usage.

Charter is also forbidden from imposing data caps for up to seven years as a result of deal conditions imposed by regulators in return for approval of its merger with TWC and BH.

Updated: Verizon Trials DSL Data Caps in Virginia

Phillip Dampier May 17, 2018 Consumer News, Data Caps, Verizon 2 Comments

Existing Verizon DSL customers in some states are discovering the company is defining “usage” allowances on its two DSL packages. (Image courtesy: Smith6612)

Is Verizon slapping the caps on its DSL customers in the northeast?

A handful of New York and New Jersey Verizon customers were surprised to find Verizon suddenly defining usage limits on their DSL service on its website dashboard for existing customers:

  • High Speed Internet: Up to .5 – 1 Mbps — 150 GB Usage
  • High Speed Internet Enhanced: Up to 3.1 – 7 Mbps — 250 GB Usage

The sudden appearance of data allowances confused some customers, because the only references to them appear on pages for existing customers seeking to change or upgrade their current DSL package, and only in certain sections of upstate New York and New Jersey.

Careful scrutiny of Verizon’s terms and conditions make no reference to the new data caps, although the company declares customers are responsible for all usage charges. There is also no mention of the caps on Verizon’s sales pages for prospective customers, and phone reps didn’t know anything about them either.

Verizon has not indicated what might happen if a customer exceeds that cap or where the caps are being enforced, if anywhere.

We reached out to different Verizon press contacts twice this week to get confirmation and have heard nothing back.

If you are a Verizon DSL customer, do us a favor and let us know in the comment section what you see when you review options to change your DSL service.

Update 7:18pm EDT: Verizon did get back in touch with us after we went to press in response to several questions.

Here is our Q & A with Verizon’s Ray McConville, corporate media relations representative for New York, New Jersey, Connecticut, and FiOS:

Q. Is Verizon setting data allowances on their DSL service plans?

No. We have been conducting a usage billing trial to a very small set of customers in Virginia where we would measure their data use and display it in their billing. While these customers were given the 250 GB and 150 GB allowances you showed in those screen shots, we’ve never billed customers who exceed those allowances and have no plans to do so. The purpose of the trial was more the idea of accurately collecting and displaying usage in billing.

Q. If a customer exceeds that allowance, what happens?

Nothing. Again, we don’t do data caps. We have the small Virginia trial of displaying usage in billing, but it’s still not a cap, and customers aren’t billed for exceeding the 150 or 250 GB numbers.

Q. Is this a new policy?

No. It’s not a policy – we don’t have data caps or overage charges.

Q. In what states or service areas, if any, is this data allowance policy in effect?

Just the small Virginia trial, and customers are not charged for going over the “allowance.”

Q. If that is the case, why are customers in New York and New Jersey seeing the usage allowances?

It’s a likely system error; they should not have seen that. Only customers in the very limited part of Virginia where we have the trial should see such a thing.

Q. What is the status of the trial in Virginia?

Trial is ongoing – not aware of any end point.

Data-Capping Comcast Forecasts “Tremendous Amount of Consumption” Growth in Broadband Usage

Usage caps for one and all.

Comcast, which insists on placing a 1 TB (1,000 GB) usage cap on most (but not all) of its broadband customers, is predicting explosive growth in broadband usage as customers connect more devices to their internet connections.

“[If] you look at in terms of just overall consumption, just at a high level, you look at the top 10% of our customers, just how much they use, they are using 20 or more connected devices,” said Comcast Cable president and CEO David N. Watson on a company conference call. “And it’s a tremendous amount of consumption that we have. And I think that’s where the market is going. There is going to be more consumption, more connected devices.”

Comcast’s growth forecasts suggest the company schedules regular network upgrades, although it has only adjusted usage allowances three times in the last decade:

  • Comcast introduced a 250 GB usage cap in 2008 that carried no overlimit penalty but persistent violators lost their Comcast broadband service.
  • Comcast raised the cap 300 GB in 2013 and implemented an overlimit fee.
  • Comcast raised the cap to 1 TB in 2016 and began promoting its Unlimited Data Option as an insurance policy against bill shock from overlimit fees.

“It is important to know that more than 99 percent of our customers do not use a terabyte of data and are not likely to be impacted by this plan, so they can continue to stream, surf, and download without worry,” claims Comcast on its website. As of December, 2017, “Xfinity Internet customers’ median monthly data usage was 131 GB per month during the past six months.”

Such claims should make customers wonder why Comcast needs a usage allowance of any kind if these claims are true. A 2016 study suggests Comcast may have more heavy users than it is willing to admit. The research firm iGR found average broadband usage that year was already at 190 GB and rising. There is no third-party verification of providers’ usage statistics or usage measurement tools, but there are public statements from Comcast officials that suggest the company faces a predictable upgrade cycle to deal with rising usage.

“We increase the capacity every 18 to 24 months,” confirmed Watson.

Upgrading is also a crucial part of Comcast’s ability to charge premium prices for its internet service.

“Not all broadband networks are created equal,” Watson said. “If you are providing a better solution in broadband, your pricing can reflect that.”

For Comcast customers using a terabyte or more in a month, after two courtesy months of penalty fees being waived, Comcast will recommend signing up for its Unlimited Data Option, which costs $50 a month. If you do not enroll and exceed your allowance a third time, the company will bill you overlimit fees: $10 for each additional block of 50 GB of usage. The maximum overlimit penalty in any single month is a whopping $200.

Critics of Comcast’s data caps point out that Charter — the nation’s second largest cable operator, has no usage caps at all. Optimum (Altice) also does not impose data caps. Those that do often copy Comcast’s data allowances and overlimit fees exactly — all to deal with so-called “data hogs” that the companies themselves claim represent fewer than 1% of subscribers.

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