Thursday, September 25, 2008

ISPs: Video Flood Will Drive Tiered Broadband Pricing

It now seems that ISP providers want to put a meter on usage. It certainly starts to make bit streams sound like a utility; your water and electric meter being read every month to determine what your bill is going to be. I still recall the days when your telephone calls were measured by minutes and you needed to be very careful, especially if calling "long distance". But wait, aren't those days over. Telephone bills are an all you can eat model, US and Canada, for one low price. Even some cell carriers allow all the calls you can make to other cell phones, and unlimited nights and weekends.

And now ISPs want to turn back that clock, from one low price for an unlimited, "always on", connection to a usage pricing plan. Is it possible to put the cat back into the bag? In this new competitive world, I say it seems unlikely. The moment your cable ISP changes pricing plans is the moment the consumer takes a serious look at their telco competitor. The provider that keeps their pricing low will see a competitive edge, especially in this current economic state. While they have made the internet connection as important to a household as water and gas, consumers will be proactive to switch providers when pricing plans change. The solution is more efficient technology solutions, not caps or pricing penalties. This issue may just be the turning point in this competitive race.

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