Capping The Future

Time Warner is planning to test a usage-based fee schedule shortly. Word has it that there will be four plans, 5GB, 10GB, 20GB and 40GB.

In other words, if you go with the top plan, you can download maybe two uncompressed HD movies a month.

This isn’t going to cut it.

Yes, I’m well aware that this is 2008, and very few people are downloading HD movies left and right, and most people chewing up TWC’s bandwidth aren’t doing the most legitimate downloads in the world.

But it won’t be 2008 forever.

Imagine owning an HDTV, that’s hardly science fiction these days. Imagine doing something sick and twisted like watching only HDTV stations with your HDTV. Imagine your cable company telling you, “You bandwidth pig! Yes, we did charge you a little extra for the HD service, but you’re hogging up way more bandwidth than that extra fees justifies. From now on, you get 50 hours for your monthly, and we’ll charge you extra per hour after that.”

Why not? What’s good for the goose is good for the gander.

The reality is the future is video. HD video. Broadcast, narrowcast, youtubecast, whatever. And whether you’re providing cable channels or movie downloads, it’s either fiber optics time, or your time will soon be over. Bandwidth is bandwidth, and everyone is going to need a lot more of it, soon, whether it’s for the PC, or TV.

The future isn’t getting tons of money from those using 50GB a month now, the future is providing everyone with 50GB at a reasonable price tomorrow. Today’s abuse will be tomorrow’s use, but you’re not going to be ready for tomorrow if you think tomorrow’s requirement are something evil that must be stopped.

Five years from now, it’s not going to be 5% of your users geek chewing up 50-100GB a month; 50% or more will be chewing up that and more.

Of course, one could impose caps today and still get ready for tomorrow, but as you’ll see, that’s not the mindset among the cable people.

Some months ago, there was a panel discussion at some video conference about this. We quote:

“HDNet CEO Mark Cuban said July 25 that fiber pipes owned by cable operators and other high-speed-Internet providers would eventually allow them to offer consumers Internet speeds of 1 Gigabyte per second . . . [b]ut Cuban added that he doubts that cable operators . . . would give [that to] consumers.

“To think that [Charter Communications CEO] Neil [Smit] and [Time Warner Cable CEO] Glenn [Britt] and [Comcast CEO] Brian Roberts and everybody is going to put a Gigabyte to the home in the next five years to ensure all your bandwidth — it’s just not going to happen,” Cuban said Wednesday. “And over the next 10 years, it’s questionable.”

It just so happened that the head of Time-Warner was around, and here’s what he had to say:

“Britt . . . said he disagreed with Cuban. “You could do it [offer consumers 1 Gbps of bandwidth] . . . .” But Britt questioned the need for such a high-speed offering, asking, “What’s the benefit to that consumer?” Britt noted that Time Warner already offers a wide choice of video programming.”

Well, I don’t know, but as a wild-ass guess, if you wanted to download or stream a movie rather than burn expensive gas and add more CO2 to the air driving to the video, it might be nice to get video on demand, like, on demand. Or maybe get a lot more HD-channels, and not get the video channels so compressed, but what do I know compared to Mr. Britt, who knows that the real challenge to cable companies isn’t bandwidth, it’s marketing. To quote again:

“Britt said Time Warner and other cable operators need to improve the quality of their consumer marketing pitches . . . . “I think that as you think about the operator part of the business going forward, we have a lot of competition. At some point somebody’s going to say, ‘Why should I buy Time Warner Cable instead of Verizon [Communications]?’”

Again, I don’t know, but after you go to a forum like this one, and people are practically going to church and lighting candles in the hope that they can get Verizon’s FIOS soon, I think it’s “Earth to Britt” time.”

The sad reality is, at least in America, the only technological innovation and strategy we get from people like Britt the Cable Guy comes from one four-letter word: fear. In New York City, TWC has bumped up speeds only because of another four-letter word: FIOS.

This is why the United States is starting to look pretty sad when it comes to broadband compared to Japan.

To add insult to injury, the Japanese have jumped ahead mostly by creating a more competitive environment than can be found in the U.S..

I think the U.S., or any other place where the providers are too fat and happy, needs to do the same.


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