Comcast Targeting Video Users With Up to 50% Higher Rates

UPDATE: A set of leaked Comcast talking points confirms that this new policy is NOT about addressing network congestion. They are training their service reps to say that the policy is about “fairness” rather than congestion and to avoid using the term “Data Cap” because, although totally accurate, it has a negative connotation.

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Comcast is “trialing” a new data capping plan. This will result in significantly raised rates for heavy video users who have previously enjoyed unlimited data plans.

Comcast is trialing the data caps in limited areas for now. Scroll to the bottom to see if you are getting hit.

Here are the details of the plan:

You’ll get 300 GB of data each month. If for any reason you exceed the 300 GB included in your plan in a month, we will automatically add blocks of 50 GB to your account for an additional fee of $10 each.

On a typical month I go over 450 GB, which will now cost me $40 for 4 blocks of additional data. This is a $480 yearly increase to my cable bill. The only way to avoid overages is to purchase the new unlimited data option for $30 to $35 per month depending on your location ($30 for me). This is still a $360 to $420 annual increase. The lowest Comcast internet package in my area costs $66.95 a month. The new unlimited data plan would represent a 45% to 52% increase in price to that plan.

Here are the details of the Unlimited Data option:

If you don’t want a 300 GB data plan, the new Unlimited Data option is an alternative that provides additional choice and flexibility, especially for customers who use lots of data. You can choose to enroll in the Unlimited Data option at any time for an additional $30 a month, regardless of how much data you use.

The fact is, I am being forced to get the new unlimited plan. I can’t really try to throttle my use and risk massive overages. In some months of heavy usage I have gone over 1000 GB, which would cost me $140 in overage fees for one month alone. So Comcast gets another $360 a year from me without providing any additional services.

Although my usage is way over the cap, it isn’t particularly heavy. Below is a snapshot from Comcast’s usage estimating tool. If you set it for only 2 heavy internet users (all 6 types of usage at the high end of their scales), it estimates 784 GB, over twice the new cap, and representing $100 in overage fees.

What’s most disturbing is the fact that without video, the estimation above would be well under the cap. In fact, video itself is double the cap. Now, this does assume a very heavy user, downloading or streaming a few hundred hours of video a month. But it isn’t unreasonable usage, otherwise Comcast wouldn’t have based their estimation tool on it. Video is a bandwidth hog, but that doesn’t mean its use should be penalized and limited. Video is helping to drive business, it should be embraced and encouraged.

Of course at some point I understand that Comcast has costs related to improving infrastructure to allow for more data consumption, but this isn’t the right way to address it. Some services work better under a “metered” structure and some work better under an “all you can eat” model. Internet usage should be unlimited by default, as it has been, and if Comcast wants to raise our rates by 50% they shouldn’t do it by imposing caps. They should just openly and honestly raise our rates if they think it is justifiable based on their costs.

With over 22 million internet subscribers, fully implementing this plan will get Comcast somewhere between $8 billion and $9 billion extra revenue a year without having to provide a single new feature or service (other than their helpful usage estimation tool). Again, if that money is needed to improve infrastructure to ensure that we will have quality service, then it is a legitimate rate increase. A statement from Comcast explaining how they expect to spend the $8-9 billion would be helpful and reassuring. I am sure we would all like to know what developments they have planned to improve their well documented service issues.

During a similar trial earlier in the year in other locations, a Comcast service rep was recording lying to a customer about the new caps, saying they were required by law. Internet data caps have long been a controversial subject, compared to “extracting monopoly rents” considering the lack of competition in many areas. If you agree, please share this article and if you are effected by this, call your Comcast service reps to complain. The future of video will fare much better on open highways without tollbooths every 50 GB down the road.

According to the notice I received, the following areas are affected by the new caps.

Huntsville and Mobile, Alabama; Tucson, Arizona; Fort Lauderdale, the Keys and Miami, Florida; Atlanta, Augusta and Savannah, Georgia; Central Kentucky; Maine; Jackson and Tupelo, Mississippi; Knoxville, Memphis and Nashville, Tennessee; and Charleston, South Carolina.