Time Warner to Test Metered Internet Usage

June 05, 2008 06:01 AM
by Lindsey Chapman
Time Warner Cable has drawn ire from Web users and curiosity from competitors over plans to charge new customers based on how much bandwidth they use.

30-Second Summary

Excessive Internet usage from customers and the price of upgrading broadband infrastructure are costing Time Warner Cable money. And the company wants to do something about it.

Time Warner says 5 percent of its Internet users who download and upload the most files are slowing down the network for its “average subscribers.”

Hoping to solve that problem, the company is testing a metered Internet use plan in Beaumont, Texas. Starting June 5, new broadband customers will pay based on broadband consumption rather than download speeds. Customers will also be charged $1 for every gigabyte they go over a monthly allowance.

The fees could help pay for new Web infrastructure. “In order to make investments in the infrastructure, we have to find the revenue to pay for it,” said a Time Warner Cable spokesman.

Critics worry Time Warner’s plan will hinder data usage and Web innovation. Others say many users are sure to exceed the broadband caps.

Although Internet usage is “huge” and still growing rapidly, The New York Times says the technology for handling the traffic is developing quickly, too. Andrew M. Odlyzko, a former researcher at AT&T Labs, said demand probably won’t overpower the Internet.

Meanwhile, other Internet providers say they’ll watch how Time Warner’s trial goes to determine whether they, too, might experiment with bandwidth consumption charges.

Headline Links: Metered Internet usage test

Opinions & Analysis: Thoughts on Time Warner’s plans

Related Topic: Internet traffic jams

Reference: Web technology


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