Do you love your cable company? Are you happy to pay big bucks to Comcast or Time Warner every month? I doubt it. So it won’t make you any happier to know that the cable giants are engaged in an ugly double play: charging you more for data you download via their broadband services AND moving to unfairly make competitive services, especially Netflix, so expensive you can’t afford to use them.
How are they doing it? First, they are beginning to impose tiered data plans on wired broadband customers. As people increasingly choose to watch bandwidth-intensive video and movies via the Internet, they are beginning to drop unlimited service plans and replace them with tiered pricing pegged to usage, not just speed.
In San Antonio, for example, Time Warner customers who sign up for a light plan of 5GB of broadband — that’s the equivalent of two high-definition movie downloads — are rewarded with a $5 discount each month if they don’t go over. If they do, they pay $1 for every additional gigabyte, according to a piece in the New York Times this week.
From a consumer point of view, that’s bad enough, though I have some sympathy for the argument that if you use more, you should pay more. But that aside, what makes the metered plans even more obnoxious is this: Comcast and other cable and satellite providers have their own streaming video services, which they sometimes do not count against monthly data limits.
So if you’re a Comcast customer, watching a movie on Netflix will move the data meter in a hurry. But if you watch the same movie via Comcast’s Xfinity TV app on the Xbox 360, it won’t count against your allotment.
That’s an obvious violation of the principal of net neutrality, which holds that all data must be treated equally. To be even clearer: Comcast is penalizing competitors who don’t own the pipes that deliver content to the home.
Comcast claims that its Xfinity service should not count against data caps because it is not streamed on the public Internet but over the company’s private network. Really? That is the most disingenuous, self-serving argument one could make. The company claims there is a technological difference between its “private network” and the Internet, but I’m happy to note that both Congress and the Justice Department are looking askance at that claim, and conducting investigations.
If there was ever a case of unfair competition that hurts the public, this is it.
Don’t believe the arguments that the government is intruding on the free market. It’s not “free” when the cable companies keep the market from working as it should by unfairly limiting competition. They should be stopped. If you care about the issue, let your Congressional representatives know.
San Francisco journalist Bill Snyder writes frequently about business and technology. His work appears regularly in CIO.com and the publications of Stanford's Graduate School of Business and the Haas School of Business at the University of California at Berkeley. He welcomes your comments and suggestions.