Time Warner To Limit Bandwidth Usage; Launches ‘Pay By The Gigabyte’

Broadband giant Time Warner Cable introduces ‘pay by the gigabyte’. Subscribers that go over the new bandwidth quota will be charged $1.00 per gigabyte.

Just when people thought it couldn’t get any worse, a new Time Warner Cable trial program that launched on Thursday will have new subscribers in Beaumont, Texas paying for their Internet consumption at the minimum rate of $29.95 per month for a 768 Kbps connection that offers a 5GB cap and the higher end package offered at $54.90 will only give subscribers 40GB a month with 15MBps. In addition, subscribers who go over the bandwidth (cap) will be paying $1.00 per gigabyte for uploads and downloads over quota.

So will Time Warner’s joint partner Comcast follow? If so, both companies will possibly begin to decline in revenue and subscribers as consumers try to cut down on spending and opt for a more attractive ISP which gives uncapped usage. With the growing usage of online movies and music, one would think that ISP’s would be looking for ways to expand usage for consumers while capitalizing. The only ones to possibly use this service are those who rarely use the Internet and those that just need to check their email.

Will ISP’s take the mobile phone industry approach which will inturn provide a backdoor for local ISP’s to brand themselves such as some of the regional cellphone companies?

In the end, consumers will definitely be the decision makers behind this trial experiment.