Comcast (s CMCSA) says it is planning to make sweeping changes to its data usage plans and will start by boosting the data cap from 250 GB a month to 300 GB a month. The move is in response to changing consumer usage behavior and a shift to more cloud-oriented computing. Comcast, which is the largest broadband provider with around 20 millon customers in the U.S., points to emergence of devices such as iPad and Roku as a reason behind this change.
Comcast first introduced the idea of metered broadband in 2008. At that time, company had come under criticism for being unable to develop a meter to accurately show the monthly bandwidth usage. Since then other U.S. broadband providers have been adding a “cap” to their data accounts and are betting that consumers will pay for additional bandwidth. While this hasn’t become a widespread practice just yet, almost all major companies are toying with limits and additional charges.
The company explained its decision in a blog post, which follows below. If you want our take on the subject and more details, read Stacey’s analysis.
Today, the way people use video and access information has changed dramatically. Four years ago, when we first instituted a broadband Internet data usage threshold, the iPhone had just been introduced…the iPad didn’t exist…and the experience of watching streaming video on your home PC or through a Roku box or direct to an Internet-capable TV was much different than it is now.
While the world was changing, so were we. Over the past few years, we have been an industry leader in innovation — delivering exciting new products to our customers on a regular basis. Our recent announcements about the Xfinity TV app, Streampix, HBOGO, WatchESPN, and Xfinity TV on the Xbox 360 are just a few examples of how we’re using new platforms to deliver new services to a range of consumer devices and screens.
In 2008, we announced an Internet data usage policy that allowed residential customers up to 250 GB of data usage per month. It was widely recognized that this was far above any normal (including very heavy) residential use of our high-speed data service, and in fact, that remains the case today. (Netflix April 2011 Letter to Shareholders; PC World — ‘Are Broadband Usage Caps Inevitable?’; ArsTechnica: ‘Comcast starts 250 GB bandwidth caps October 1′). With the passage of time, it’s important to remember that the purpose of the usage threshold was simply to ensure that all of our customers were treated fairly and had a consistent and superior experience while using our high-speed data service. That has been and will be our sole goal. We’ve never had any intention to limit the lawful use of the Internet or restrict our customers’ ability to view online video.
Importantly, we have consistently treated all video carried over the public Internet the same whether it comes from our sites or anywhere else on the public Internet. XfinityTV.com, nbc.com, Hulu, Netflix or YouTube, and every other Internet video site (whether our site or a third-party site) is treated, and will continue to be treated, exactly the same. That’s consistent with FCC rules and consistent with what we have always done and continue to do.
We’ve also always said that we would evaluate customer usage and a variety of other factors and make adjustments as the marketplace evolved. Please see our FAQs and a Venture Beat story on this topic. Over the last several years, we have periodically reviewed this policy, and for the last six months we have been analyzing the market and our process and think that now is the time to begin to move to a new plan. This conclusion was only reinforced when, in recent weeks, some of the conversation around our new product introductions focused on our data usage threshold, rather than on the exciting opportunities we are offering our customers.
So as the market and technology have evolved, we’ve decided to change our approach and replace our static 250 GB usage threshold with more flexible data usage management approaches that benefit consumers and support innovation and that will continue to ensure that all of our customers enjoy the best possible Internet experience over our high-speed data service.
In the next few months, therefore, we are going to trial improved data usage management approaches comparable to plans that others in the market are using that will provide customers with more choice and flexibility than our current policy. We’ll be piloting at least two approaches in different markets, and we’ll provide additional details on these trials as they launch. But we can give everyone an overview today.
The first new approach will offer multi-tier usage allowances that incrementally increase usage allotments for each tier of high-speed data service from the current threshold. Thus, we’d start with a 300 GB usage allotment for our Internet Essentials, Economy, and Performance Tiers, and then we would have increasing data allotments for each successive tier of high speed data service (e.g., Blast and Extreme). The very few customers who use more data at each tier can buy additional gigabytes in increments/blocks (e.g., $10 for 50 GB).
The second new approach will increase our data usage thresholds for all tiers to 300 GB per month and also offer additional gigabytes in increments/blocks (e.g., $10 per 50 GB).
In both approaches, we’ll be increasing the initial data usage threshold for our customers from today’s 250 GB per month to at least 300 GB per month. ”