It is no surprise with the latest ruling on Net Neutrality that we should consider that Internet pricing is about to undergo a massive restructuring in the next few years. With video and content streaming from Netflix, Hulu +, Apple TV and so many other sites growing in popularity and with living room televisions now being sold that can stream and browse the web it is only a matter of time before broadband providers start charging rates based on broadband consumption.
Most data plans now for cell phones have per month usage rates and charge for certain megabytes of usage over the limit, imagine if home broadband solutions were to charge per gig or charge different tiers depending on type of traffic. Internet streaming +$10.00 per month for a normal bill vs someone who just uses the internet casually.
While I think online gaming and internet streaming may cut it pretty close to the amount of traffic being utilized I do think that broadband ISP’s need to stay on the cutting edge of delivery by offering wider pipes with lower latency and making it more available around the country. This has a cost and there are going to be premiums for high end network consumers. No longer can there be a 50mb per month cable modem plan that is a flat rate for all users, some users may use 10x as much traffic as others and companies will be looking for some way to charge for those high end users.
This could be good or bad, we will see more competition between ISP’s as we do with cell phone companies now where some offer unlimited or reduced rates to undercut another company. This however is bad when one is already paying a monthly subscription to a service like Netflix or Hulu + and then has to pay a premium to their ISP because they like to stream movies or TV shows. This type of double cost is not going to sit well with consumers and if ISP’s are going to look to charge based on usage, deals will have to be made with online streaming companies or vice versa to help balance it all out or consumers will cry fail and services will fail or be adopted much more slowly than businesses want.
I already pay a pretty high premium for broadband and at 25mb downstream from Cox Communications, I am paying $79.99 per month which I think is on the higher end, I hear there are cheaper rates available and I am waiting for other opportunities to arrive as my city is relatively small and broadband offerings are very limited still in my area. I do subscribe to Netflix and stream movies to my Nintendo Wii, Roku and PC’s on a regular basis, sometimes I am streaming to two devices at the same time. I also play online games and so does my son though not heavily and nothing like World of Warcraft, the closest is Runes of Magic which is only played a few times per week.
I would consider my household among the heavy internet users and wonder if and when Cox will suddenly send me a letter that my bill will increase due to my traffic utilization. Time will tell…