Comcast is calling it a “trial” — the ongoing and vastly expanding rollout across the country of its home Internet broadband “data caps.” Parts of Virginia, Louisiana, Tennessee and Arkansas will fall under this plan starting Dec. 1. Other Comcast costumers nationwide have been notified of the new strategy by the cable behemoth to charge customers more for something they are already using.
Consumer advocates have little doubt that, eventually, all Comcast home-broadband users will face this new 300 GB monthly usage cap and a $10 overage penalty per 50 GB above the 300 cap — automatically added to their bill the following month.
To avoid such overage charges, Comcast will accept a $30 premium charge on top of current monthly rates for unlimited broadband service.
Comcast started testing a flat $30 fee for unlimited overages in Florida in October, and a few weeks later launched the same option at a higher $35 price point in Atlanta. The company is giving customers a three-month grace period.
What’s the motivation for Comcast?
Comcast has said that data caps are fair because it allows the company to charge heavy data users more for their activity. Comcast insists that only about 8 percent of all customers go over the 300 GB limit.
But the market for high-speed Internet is very uncompetitive. Many homeowners have little choice but to stay with Comcast. Additionally, more consumers are “cutting the cable,” meaning they are dumping traditional cable channel bundles while increasing broadband usage. The surge in broadband use is heavily affected by the rise in popularity of streaming services — such as Netflix, Hulu and other services sprouting quickly across the media landscape from broadcast and cable networks, as well as Amazon.
“Comcast continues to exert its dominance in the uncompetitive market for high-speed Internet access, increasing the bottom line for its incredibly profitable broadband business,” Matt Wood, the policy director for Free Press, said in an emailed statement. He added that the caps “stifle innovation and choice in online video and cloud-based services.”
Leaked documents are shedding new light on Comcast’s strategy. The Consumerist reports on these documents that act as instructional guidelines for Comcast service representatives who deal with questions from the public. The instructions include telling reps not to use the term “data threshold” or “data caps”. They should stick to the term “Data Usage Plans,” the Comcast guidance says.
Reps are also instructed to not use Internet broadband congestion as an excuse for initiating the new data usage plans. The document states:
Don’t Say: ‘The program is about congestion management.’ (It is not.)
The parenthetical seems like an admission by Comcast that its data cap has absolutely nothing to do with easing the load on its network, the Consumerist states.