RR can stick it

**timechange** · 04-09-2002, 08:54 AM

This story appeared on Network World Fusion at
http://www.nwfusion.com/net.worker/n...networker.html

Time Warner: Bandwidth hogs, pay up!
Cable company decides heavy bandwidth users will pay an additional monthly fee.

By Michael Martin
Network World, 04/08/02

The all-you-can-eat bandwidth buffet that cable modem users enjoy may soon come to an end.

Later this year, Time Warner Cable will begin charging users a fee for downloading more than a monthly limit. The company has yet to release specific pricing changes.

The reason behind the move? Cable modem hogs cost cable companies money. Their networks are based on a shared infrastructure with several homes or businesses sharing a local access pipe. If one home or business is using its connection to transfer large amounts of data, performance for all other homes or businesses that rely on the same access pipe is affected. Ultimately, to ensure better performance for cable modem users on that portion of the network, the cable company has to segment the network by installing new equipment.

"Some users take up an inordinate amount of bandwidth," says Mike Luftman, a spokesman for Time Warner Cable. "Anyone staying below a total amount of bits moved per month won't pay more. But if you consistently go over the limit, you're going to have to pay."

Telework programs for large enterprise customers won't likely be affected because they're already subject to special pricing plans handled by the cable companies' business divisions. But corporate teleworkers for smaller companies, who regularly upload and download large graphics files, for instance, stand a greater risk of being affected than those who use their cable connection mostly for e-mail.

Unlike some restrictions imposed on cable modem users in the past, such as not letting teleworkers connect to their businesses via VPNs, the bandwidth limits are not aimed solely at business users. But in some cases, the restrictions could make cable access a more expensive proposition than companies had expected.

While charging heavy cable modem users more per month may drive some of them to other access methods, such as DSL, that's not necessarily a bad thing for cable providers, says Matthew Davis, an analyst with The Yankee Group.

Heavy users cost the cable companies a lot of money by forcing them to make network changes, and it's not necessarily worthwhile for the providers to keep the heavy users happy, Davis says. The cable providers will likely ensure that the additional charges aren't large enough to drive away droves of users, he adds.

Any pricing scheme the cable providers come up with is unlikely to deter telework programs from continuing to rely on cable modem access, says Dana Tardelli, an analyst with Aberdeen Group. "If it's $40, $50, $60 or $70 per month, it shouldn't matter because access is access and the job still needs to get done," he says. "If they doubled the price, it might be a problem, but I doubt they'd do anything that drastic."

While Comcast and Cox Communications each say they have no immediate plans to follow Time Warner's lead, now that technology that lets providers monitor network usage is available, it may be only a matter of time before they too move to a usage-based system. Another sign of things to come: Cox has begun user trials of a tiered service for which customers pay more for guaranteed 128K bit/sec symmetrical speeds, says spokeswoman Amy Cohn.

In moving to a tiered pricing model, Cox is following in the footsteps of DSL providers.

Most DSL providers offer a variety of services. Consumer-class offerings typically provide download speeds of up to 384K bit/sec and upload speeds of up to 128K bit/sec with no service-level agreements (SLA). But DSL providers also offer business-class services, with symmetrical speeds, some SLAs and enhanced customer support at a premium price.

DSL providers seem happy with their tiered approach and have no imminent plans to introduce usage-based pricing. Part of the reason may be that DSL networks are less susceptible to bandwidth hogs than cable networks. DSL connections are dedicated until they hit the DSL access multiplexer (DSLAM) at the local central office. But bandwidth hogs could still affect performance for other DSL users on the same DSLAM if the connection from back into a service provider's Internet point of presence was not large enough.

Another reason DSL providers may not yet be looking at usage-based billing is because "they are more focused on troubleshooting their networks," Davis says. Ultimately, though, Davis says he thinks DSL providers will move down the same path as cable providers and begin to charge heavy users extra.

**Zacrifice** · 04-09-2002, 10:01 AM

Heh same thing thats happend in australia with Telstra and Optus
I am outraged at Telstra because im on ADSL right and when i first got it it costs 94 dollers a month for all da bandwidth i could have... THEN they put a 3Gig limit on Download.. Fair enough i barly use 2 Gigs a month and because i was with Telstra on a 12 month plan i got discounts and such like that before more changes da price for ADSL for me went all da way down to 60 dollers Now heres the kicker

Telstra in its Infenet Wisdom desided it wasnt getting enough money So heres what they did

They pushed up the prices so now its 94 Dollers (It was originally 64 *After the 12 month contract i got a discount*) theres still a 3Gig download (Which it seems these days i am now getting close to every month and if i do go over i cant access websites only collect email and visit free sites (Which none of them i like anywho) BUT if i was to upgrade to the next plan up i would get 5Gig of bandwidth 1500/256 upload download $0.129 for going over my limit and guess what.. All for a measly 224.95 a month NOW if i could afford that every month then that would be dandy But telstra seems to ignore the fact that most users are working class people and we cant afford 224.95 and for Only an extra 2Gig and a small increase in download speed witch you would end up using even faster couse everything is faster!

So were all stuffed cause telstra wants more Money! Optus wants more Money and Telstra wants to strangle the compatition by charging them more to resel the service to people.. So Australia sucks and it would seem americas going inthe same direction

I can't wait for the day where I and many other Aussies say enough and enough and we all Stand up and Bring down a company.. Such as.. Telstra.. and We shall i say We Shall bring the company to it's knees because we the people give them the company the Power and We the people can take It the power away from them the companys!

**tribby** · 04-09-2002, 01:30 PM

My cousin is the Vice President of Broadband at AOL Time Warner... I'm going to give him a hard time about this

**Still Shady** · 04-09-2002, 01:45 PM

Originally posted by tribby
My cousin is the Vice President of Broadband at AOL Time Warner...

But, I own AOL Time Warner!

**clio** · 04-09-2002, 03:28 PM

that's why i have DSL.

**tribby** · 04-09-2002, 03:29 PM

Originally posted by clio
that's why i have DSL.

Damn straight

I just talked to my cousin... he said he doesnt even know what kind of pricing theyre thinking about... lol..

**timechange** · 04-09-2002, 04:14 PM

FOR THE LOVE OF LINUS TORVALDS!

Please tell your cousin that Roadrunner earned its reputation as a great cable provider. I've used Media One (then ATT Internet) cable and Bellsouth DSL and the speeds I am getting with RR (plus the reliability of service in the rural area that I live) are second to none.

But dang it if I have to watch my meter for downloads/uploads! This is insane. TimeWarner gets $100 /month from my cable Internet and cable TV access. Have they oversubscribed their network and want now to pass the buck onto the consumer? They already raised their prices in January!

The only alternative I have here is crappy Sprint DSL. But as a matter of principle, I'd switch to it and cancel my cabe TV as well, switching to satellite, if I had to. Metered broadband is the SUCKIEST invention AOL/Time-Warner ever came up with

**tribby** · 04-09-2002, 04:28 PM

Yeah.. I didnt have time to talk to him for long but I'll call him later to try and find out more, metered bandwidth does suck

**timechange** · 04-09-2002, 05:31 PM

Thanks Jeremy, much appreciated. Although company policies are usually the brainchildren of the VP of Marketing.

But it would be interesting to get some feedback from your cousin.

**clio** · 04-09-2002, 06:03 PM

verizon says:

All of our DSL packages include:

Unlimited DSL Internet access
4 e-mail accounts
10 MB Web space
Self-install kit
24/7 live technical support
30-day money back guarantee

dunno. i'm online all the time. though i can't really imagine being a bandwidth hog. the only reason, i didn't get cable was b/c cable sucks in my neighborhood. i live in a historic part of boston and everything here is OLD. and everytime it rains or gets REALLY windy, something goes out, usually cable or electricity. it's pretty damn annoying. but phone line stays, so DSL it is

**timechange** · 04-09-2002, 09:03 PM

I too had ADSL with Bellsouth when I lived in the heart of Orlando. But I am in rural Clermont now, 35 miles from Orlando (but hey, 3 miles from Disney World) and DSL here blows.

I think I jinxed it.....Roadrunner is having downtime now

**timechange** · 04-10-2002, 08:43 AM

AOL takes the high-speed challenge

By Jim Hu
Staff Writer, CNET News.com
April 10, 2002, 4:00 AM PT

news analysis Barry Schuler's departure as CEO of America Online has thrown a spotlight on the broadband plans of beleaguered parent AOL Time Warner.
The company considers a faster, fatter pipe to the home as the key to selling a host of new products and services such as digital music subscriptions and movie downloads. AOL Time Warner co-Chief Operating Officer Bob Pittman, who will take over for Schuler, has said he believes the company could bring in as much as $159 a month per subscriber for a range of services. That figure includes a $54.95 monthly charge for digital subscriber line connection, which is among the most expensive in the industry.

Now comes the scary part: Pittman may have to make those numbers if the online division is to regain its former glory and help its parent recover a stunning $250 billion in market value that has disappeared since the AOL-Time Warner merger was first announced.

To get a handle on the size of the goal, consider that the company averages between just $17 and $18 in subscription fees per member per month. That means each high-speed customer could be worth as many as nine dial-up subscribers--if Pittman can reach his projections. But that's a big "if" in light of AOL's problems, many of which were detailed Tuesday in an investor note from Lehman Brothers equity analyst Holly Becker.

"We believe the AOL division is facing several fundamental challenges: a slowing narrowband business, a challenging broadband transition, collapse of the online ad market and a murky path to profitability internationally," she wrote.

In announcing Schuler's reassignment to a new division, AOL Time Warner downplayed subscriptions and focused on the significance of the executive switch for reinvigorating AOL's slipping advertising sales.

Earlier this year, AOL Time Warner reported that the AOL division's advertising and commerce revenue declined 7 percent, from $686 million in the fourth quarter of 2000, to $637 million in the fourth quarter of 2001.

But in a footnote to the lengthy report, the company noted that during the quarter other corporate units poured $138 million worth of advertising into the AOL unit, accounting for more than a fifth of that unit's revenue.

Without this intercompany advertising, such as marketing campaigns on behalf of New Line Cinema's "The Lord of the Rings" movie, the AOL division's revenue declined 27 percent from the same period in 2000.

AOL's short-term outlook may rise and fall on its ability to score ad deals in a tough market.

"The challenge facing us at AOL is to improve the performance of its advertising business in the current advertising slowdown by building on AOL's unique competitive position and capabilities," said AOL Time Warner co-COO Richard Parsons, who will take charge of the company when CEO Gerald Levin steps down in May.

For AOL's long-term future, however, high-speed cable access likely will be key.

Internet consumers have not been signing up for broadband in droves, partially because of added costs, but mostly because of the inconvenience of getting one's local cable or phone company to install a connection.

But even if local services were speedy and efficient, AOL Time Warner has plenty of competitors who hesitate to open their doors to the company's expansionist plans. AOL Time Warner owns the nation's second-largest cable company behind the soon-to-be combination of AT&T Broadband and Comcast. To make AOL Broadband as ubiquitous as its flagship dial-up service, AOL Time Warner needs to strike carriage deals with the competition.

Cable companies and other Internet service providers, including Microsoft's MSN and EarthLink, lobbied aggressively against the AOL-Time Warner merger. It's not likely that many of these entities will open their doors to the company now.

AOL Time Warner failed to acquire AT&T Broadband, which would have demolished a significant barrier of entry. Furthermore, about 7 million of its 12.8 million subscribers are controlled by a partnership with the Newhouse family. In a recent government filing, AOL Time Warner disclosed that the Newhouse family might choose to exit the venture and take a third of their 7 million subscribers with them.

Such a move would throw a wrench into the grand vision of AOL Time Warner. Time is not on the company's side, and neither is Wall Street.

"The rush is that you can see the impatience of investors in the stock price," said Peter Mirsky, an equity analyst at SG Cowen Securities. "Investors want anything that resembles good news."

**timechange** · 04-12-2002, 09:40 PM

Damn I hate links that don't work

**EHG** · 04-12-2002, 11:16 PM

I reside in West Los Angeles and use attbi (AT&T Broadband) formerly roadrunner service of mediaone, soon to become part of COMCAST.

Cost $45.95 including modem

Cost with my modem $35.95 month

I have some friends who reside close by and have had DSL. They all switched to Cable when it became available. In this area of Los Angeles cable provides superior speeds to DSL.

I am on-line constantly and the hours vary and I have never noticed any reduction in speed due to the amount of users in the pipe or their individual bandwidth usage.

I just did a DSL REPORTS speed test which can be seen here:

DSL TEST RESULTS 22:49 HRS EST APRIL 12, 2002

My experience has almost always been that my dl speed varies dramatically depending on the server that I am dl from.

I have dl programs from some servers and reached 250kbps and immediately before or after attempted a dl from other locations and was lucky to get 30kbps. The test results from DSL reports approximate what I am able to achive MOST OF THE TIME.

I think Mediaone was far superior as an independent company prior to the takeover by AT&T which raised the prices and lowered the quality of support. I am not looking forward to COMCAST which will probably pass on much of the $63 billion dollar purchase price for attbi to the consumers. If they handle the takeover as dismally as AT&T did with mediaone - I might be left no choice then to consider DSL - HOPE NOT!