Yet again Comcast is trying to introduce data caps. They have introduced what they are calling ‘data usage trials’ in Miami and the Florida Keys. For some reason most of their past trials for this have also been in the southeast. The new plan gives customers a monthly data cap of 300 gigabits of downloaded data. After you hit that cap then every additional 50 gigabits costs $10. For $30 extra you can get unlimited downloads.
When Comcast tried caps a few years ago they used a monthly cap of 250 gigabits. Since the average household has been doubling the amounts of data used every three years, the new cap is stingier than the old 250 GB cap since households would have normally almost doubled usage compared to the last time Comcast tried this. This means the 300 GB cap is going to affect a lot more people than the old cap.
What is probably most annoying about this is that Comcast is refusing this time to call these data caps. Instead they are calling this a ‘data usage trial’ and are trying hard to compare themselves to the plans sold by the cell phone companies. Of course, everybody in the world understands those cellular plans to be data caps.
It’s not hard to understand why Comcast wants to do this. While broadband subscriptions continue to grow, with the overall US market at an 83% broadband penetration there is not a lot of future upside in broadband sales. Further, I know that Comcast is eyeing the financial performance of the cellphone companies with envy since they can see the significant revenues generated by AT&T and Verizon with their data caps.
But Comcast also must understand that customers are absolutely going to hate these caps. Households are watching online video more and more and it is that usage that is driving the vast majority of downloads. There are other households that have big usage due to gaming, and some households that still engage in file-sharing, even though that is often illegal and riskier than it used to be.
The last time Comcast did this they saw a massive customer revolt and I certainly expect that to happen again. Take my case. I estimate that we probably use at least 500 GB per month. So for me this is basically means a $30 increase in my data rate. They have already pushed me to the edge of tolerance by forcing me to buy a basic TV package that I don’t use in order to get a 50 Mbps cable modem. If they introduce this cap they would push me over $100 per month just to get a broadband connection. At that point I start taking a very serious look at CenturyLink, the other provider in my neighborhood.
The biggest problem with any data caps is that, no matter where the cap is set, over time more and more customers are going to climb over it. We are just now starting to see the first proliferation of 4K video, and at download requirements of 18–22 Mbps this will blow past the data cap in no time.
What is most ridiculous about data caps either for cellular or landline data is that the US already has the most expensive Internet access of all of the developed countries. ISPs are already reaming us with ridiculously expensive broadband access and are now scheming for ways to make us pay more. The margins on US broadband are astronomical, in the 90% plus profit margin range. So data caps at a company like Comcast are purely greed driven, nothing else. There are zero network or performance issues that could justify penalizing customers who actually use the data they are paying for.
I am not entirely against data caps. For example, I have one client that has a 1 terabit cap on their basic data product and 2 terabits on their fastest product. They don’t use these caps to jack up customer prices, but instead use them as an opportunity to discuss usage with customers. For instance, they might convince somebody who is constantly over the 1 terabit cap to upgrade to a product with a higher cap. But mostly they use these caps as a way to force themselves to monitor customers. Their monitoring found a few customers who went over the cap because they were operating some kind of commercial retail server out of their home. Their terms of service prohibit operating a business service over a residential product and they upgraded such customers to a business product, which has no data cap.
If you want to get really annoyed, look at this Comcast blog which explains the new ‘data usage trials.’ It is frankly one of the worst cases of corporate doublespeak that I have read in a long time. You have to feel a bit sorry for the corporate communications people who had to write this drivel, but the ones to hate are their corporate bosses who are determined to make us all pay more for using data.