As Verizon Wireless implements its new “Share Everything” plan today, customers who discard their unlimited data plan in favor of Verizon’s new usage-limited plan can give the company even more money to make sure they are not bill shocked if someone on a family plan goes hog wild.

Verizon’s “Usage Controls” feature runs $4.99 a month and gives customers a tool to customize allowances for each plan participant:

Even with the new usage controls, some customers are upset Verizon will extract more from customers’ wallets if they switch plans.

“My plan for my wife’s phone will be going from $33 for minutes, $10 for text, and $25 for data, all per month, to a plan that is $40 for minutes and text and $60 for data, all per month,” writes one Chicago Tribune reader. “So my monthly bill is going from $68 to $100, plus taxes and fees. If I add one more Smartphone, the total goes to $150 per month. How exactly am I saving anything?”

Foreshadowing Bill Shock?

T-Mobile is suspicious about the value of forthcoming family shared data plans likely to be introduced by its larger competitors AT&T and Verizon Wireless later this year.

Andrew Sherrard, senior vice president of marketing for T-Mobile announced the company would not jump on the family data bandwagon, preferring to leave the current model of individual data plans for each device in place:

Some of our competitors are backing away from simple, unlimited data and moving to family shared data plans. But would this approach actually deliver a better value to consumers?  Do families really want to keep track of each others’ data consumption? We don’t think so. Just imagine mom’s email is suddenly unavailable because her teenage son watched an HD movie on his phone, consuming the family’s data allotment.

T-Mobile believes that consumers today do not want a ‘one size fits all’ approach to shared family data plans, nor would they benefit from that model.  So, what is the right way to price data for customers who want affordable, unlimited access to what, unfortunately, is a limited resource?

Here’s how we see it:

Data plans should be flexible and affordable. At T-Mobile, customers have the option of only paying for the amount of data each member of the family believes they will need. Customers can choose affordable no-annual-contract data for tablets and other data-only products they share – paying every month or buying in daily or weekly installments.

Data should be worry-free. With our unlimited data plans, there is no surprise data cap or bill shock. Customers simply pay each month for the amount of high-speed data they select and (in contrast to our competitors) T-Mobile customers can continue to use mobile data on their device at reduced speeds after they reach their limit without incurring overage charges.

Customers who pay more, should get more. T-Mobile smartphone customers with 5GB or 10GB data plans also get our Smartphone Mobile Hotspot feature included. This means, with a capable T-Mobile smartphone (most are), customers can power up to five Wi-Fi enabled devices with fast, 4G data. So rather than needing to account for each device on a shared family data plan, customers can use their existing data plan to power multiple devices, while still saving hundreds of dollars annually.

T-Mobile has adopted a traditional usage cap model that provides a set usage allowance but imposes no overlimit fees. Subscribers who exceed their allowance have their wireless data speeds reduced to levels resembling dial-up for the remainder of their billing cycle.

Verizon Wireless’ recent announcement it would kick customers grandfathered on unlimited use wireless plans to tiered data plans with overlimit fees has created controversy and has angered some Verizon Wireless customers. T-Mobile’s marketing strategy could draw some disaffected customers from larger carriers.

T-Mobile ultimately believes a shared data plan can create havoc on families trying to control their shared allotment of data for each month. Without careful coordination, consumers may find substantial overlimit fees on their wireless phone bills when they exceed their allowance.

Netflix and consumer groups like Free Press are unimpressed with Comcast’s announcement they plan to experiment with an increased usage cap in some markets and temporarily eliminating it in others.

A Netflix spokesperson issued a statement that says the company has dodged the real issue: discrimination against its traffic, which counts towards whatever Comcast usage cap the company eventually settles on, and doesn’t count towards Xfinity TV, which the cable company owns.

“Increasing the data cap is a small step in the right direction, but unfortunately Comcast continues to treat its own Internet delivered video different under the cap than other Internet delivered video,” says the Netflix statement. “We continue to stand by the principle that ISPs should treat all providers of video services equally.”

Free Press and Stop the Cap! share the belief the company’s usage caps are arbitrary and unnecessary and should be eliminated completely.

“Comcast has never had any legitimate reason to cap its Internet customers, and today’s announcement of new overage charges is just another example of the cable giant’s efforts to discriminate against and thwart online video competition,” said Free Press policy adviser Joel Kelsey. “Data caps are not a reasonable or effective way to manage capacity problems, which are virtually non-existent for Comcast.”

Kelsey also believes Comcast is still trying an end run around Net Neutrality.

“While the move to increase its caps is overdue, the notion that Comcast would charge an exorbitant rate for additional bandwidth — while continuing to exempt its own traffic under its Xbox deal — illustrates that Comcast is really trying to discourage subscribers from experimenting with online video alternatives,” Kelsey said. “We call on Comcast to drop the caps and these exorbitant overage fees entirely.”

CenturyLink announces their own Internet Overcharging scheme; customers call to cancel their service.

CenturyLink is quietly introducing usage caps for its broadband customers that will limit residential customers to between 150-250GB of usage per month.

The Internet Overcharging scheme was inserted into the company’s High Speed Internet Service Management disclosure page, and suggests heavy users are using an inappropriate amount of data, slowing down the network for other users:

The majority of CenturyLink High-Speed Internet customers make great use of their service and comply with the CenturyLink High-Speed Internet Subscriber Agreement. An extremely small percentage use their service excessively, or at such extreme high volumes, that they violate the terms of their CenturyLink High-Speed Internet Subscriber Agreement. While this high volume use is very rare, CenturyLink is committed to helping these customers find a high-speed Internet solution to better meet their needs.

CenturyLink is announcing the following Excessive Usage Policy (EUP), which will become effective in February 2012:

CenturyLink’s EUP applies to all residential high speed Internet customers and is only enforced in the downstream (from Internet to customer) direction. Video services provided by CenturyLink PRISM™ TV are not subject to the usage limits. The policy has the following usage limits per calendar month:

• Customers purchasing service at speeds of 1.5Mbps and below, have a usage limit of 150 Gigabytes (GB) of download volume per month.
• Customers purchasing service at speeds greater than 1.5Mbps, have a limit of 250GB in download volume per month.

There are no overage charges or metering fees for usage as part of the Policy.

The company exempts their own video service PRISM TV from the scheme.

“It’s another CenturyLink ripoff in action, and despite their claims that they treat all data the same, they certainly do not,” says CenturyLink customer Rob Cabella. “Their video programming is sent from local facilities, as data, down the same pipe as their broadband service, yet they conveniently leave their TV product out of the usage cap equation.”

Prism customers can watch unlimited TV, but face limited broadband usage over the exact same pipeline.

Cabella says PRISM operates much like AT&T’s U-verse.  Fiber provides service into individual neighborhoods and then standard copper phone lines deliver service the rest of the way to customer homes.

“It’s one pipe they divide up for video, phone, and Internet, but they are protecting their video service by limiting broadband use while leaving their television and phone service completely unlimited,” Cabella says.  “Video is the biggest bandwidth hog of all, and CenturyLink invites you to watch as much as you want, as long as it comes from them.”

Cabella thinks the very fact CenturyLink is offering unlimited video disproves their argument about ensuring appropriate levels of broadband usage.

“Their local facilities get overloaded to the point where they temporarily stop signing up customers, yet it’s a video free-for-all, as long as you get your video from ‘the right place’ and that sure isn’t Netflix or Hulu,” Cabella notes.

CenturyLink’s limits will apply to broadband customers signed up for PRISM or the company’s traditional DSL service.  Uploads will not count against the cap.

For the moment, overlimit fees will not be charged and the company will send warning letters to offenders that invite customers to migrate “to a higher speed if available or to a business grade data service that better fits their bandwidth usage.”

Customers who repeatedly exceed their usage limits after being notified may have their service discontinued.

Cabella isn’t waiting.

“I called my local cable company which still offers unlimited service and signed up this morning,” Cabella says. “CenturyLink didn’t even know what I was talking about when I called and said their website must have been hacked or in error.  Why would I want to do business with a company that doesn’t even have a clue what their own business is doing?  Goodbye CenturyLink.”

Should any family have to fight over the monthly Internet bill?

One of the side effects of Internet Overcharging is the one-two punch of the usage cap combined with a steep overlimit penalty.  While usage capping providers pay pennies for your Internet traffic, they can charge you up to $10/GB if you dare exceed your plan allowance.

Making sure you don’t… too much… is the job of the provider who will helpfully educate you on how to use your service less, how to establish an in-home Ministry for State Security — tracking down those malfeasant family members who want to deny running the bill up, and providing inaccurate monitoring tools designed to make you think twice about everything you do online.

Far-fetched?

Not really.  Just ask Mathew Ingram, a Rogers Cable customer in Ontario who tells Techdirt he spends much of his free time trying to figure out who is doing what with the family broadband account:

I have three teenage daughters who also download music, TV shows and so on. I figured someone had just gone a little overboard, and since it was close to the end of the month, I thought it wasn’t anything to be worried about. The next day, however, I went online and checked my usage (Rogers has an online tool that shows daily usage), and it said that I had used 121 GB more than my allotted amount for the month. In other words, I had used more than 100 GB in less than two days.

I just about spit my coffee all over the computer screen. How could I possibly have used that much? According to Rogers, I owed $181 in overage charges. Luckily there is a maximum extra levy of $50 a month (just think what it would cost if I was subject to usage-based billing).

With the help of Rogers (who also helped themselves to $50 of Ingram’s money for overlimit fees), an employee identified security holes in his wireless router which could have let all the neighbors join the broadband usage party at his expense.  But in reality, after considerable family tension and drama, one of Ingram’s daughters confessed to downloading some TV shows and forgot to close the file sharing software used to grab them.

Ingram learned a $50 (this month) lesson — he is not free to sit back and enjoy his broadband account that costs him much more than American providers charge for the same thing (without a usage cap).  He serves at the pleasure of Rogers Cable, who wins if Ingram succeeds in keeping his family’s usage under the limit — costing Rogers less money, or by pocketing the overlimit fees charged when he fails.

What scares many Canadians are plans by some providers to eliminate the monthly maximum overlimit fee.  That would have left Ingram paying a $181 penalty instead of $50.  As far as cable companies like Rogers are concerned, it’s his own fault for not keeping his family under control, and now he will pay the price.