Last week, a report by the website Credit.com claimed that Comcast — one of the largest home broadband Internet providers in America — was starting to impose a monthly cap on the amount of Internet data a household would be allowed to use per month.
According to the report, Comcast announced on Thursday that it would place a 300 GB limit on home Internet data consumption on its broadband plans. That amount is roughly equivalent to 300 high-definition TV shows or 150 movies — a threshold some households might never hit, but was still a cause of some concern for large families who rely on broadband Internet service to power numerous computers, portable devices and gaming systems.
Those customers who did go over their plans would be hit with a $10 overage fee for every 50GB of data they consumed over their limit, with a three-month grace period where Comcast agreed not to charge the overages after the data cap had been imposed, Credit.com said. Customers can also opt to remove the data cap altogether for an extra $30 on top of their Internet subscription price.
It made for a nice headline — Comcast is often seen as a telecom giant that likes to wield its mighty, monopolistic sword to limit choices in a community while imposing exorbitant fees against customers for its service — but in this case, Credit.com’s headline was wildly misleading.
It is true that Comcast has started rolling out monthly data caps — but what Credit.com’s buried in their article is that Comcast’s new monthly data plans are only rolling out in a handful of service areas as part of a trial run. Those service areas are:
- Alabama: Huntsville and Mobile
- Arizona: Tucson
- Florida: Fort Lauderdale, Miami and the Keys
- Georgia: Atlanta, Augusta and Savannah
- Kentucky: Central service area
- Maine: Statewide
- Mississippi: Jackson and Tupelo
- Tennessee: Knoxville, Memphis and Nashville
- South Carolina: Charleston
For everyone else, the good news is that Comcast is not imposing a data limit on broadband Internet use — at least not for now. The bad news is, out of the areas where Comcast is trialing a data cap, only customers in Florida will be offered the $30-a-month option to lift the cap entirely.
For Comcast, broadband Internet is quickly becoming the company’s bread-and-butter product as more and more people opt for online-only options (the company’s own quarterly earnings report show Comcast is shedding pay TV customers, but picking up online subscribers; this year, the number of paying broadband Internet customers surpassed the number of TV customers for the first time in Comcast’s history). So it stands to reason that the company would try to figure out how to squeeze a few extra dollars out of its customers.
It also comes as no surprise that Comcast would want to impose limits on how much data a customer is allowed to consume. Mobile phone companies have done this for years — offering customers a variety of plans to meet the needs of their mobile data usage. The main difference between the phone companies and broadband providers is that companies like Verizon and AT&T imposed data caps to relieve their networks of congestion. Here, Comcast may be doing it simply to avoid costs associated with maintenance and rolling out of new resources — or simply to make more money.
It isn’t clear why Comcast chose those communities to test-run its data cap policy. The likely answer is that Comcast looked at its data of who used its services the most and who used it the least, and decided to trial its data caps in the areas that use it the least. Pundits love to question Comcast, and there’s little doubt if Comcast made this policy mandatory across the board, they would face tough questions from regulators and media critics alike — to which Comcast could respond by saying the caps had little effect in the areas where it was deployed as a trial.
Would that be misleading? Sure. But it’s not like Comcast has never done that before. The company misled regulators last year when it tried to say its broadband Internet service was on par with offerings from AT&T Mobility and Verizon Wireless (it’s not) or that it didn’t group Bloomberg News near other news channels on its TV platform because it wasn’t sure what kind of channel Bloomberg was (it was required to group channels like Bloomberg alongside other like channels as a condition of its merger with NBC a few years ago).
For Comcast customers, though, there is a glimmer of hope: The broadband data cap is a trial — depending on customer feedback (and, perhaps, regulatory pressure), there’s a chance it won’t become common practice. If it does, that’s too bad, because you can be sure every large broadband Internet company in America will follow suit.
