FCC Comcast Order May Prompt Broadband Usage Caps
The FCC finding against Comcast network management may prompt other ISPs to limit the amount of bandwidth broadband customers can use or at least test such caps, said cable and telco officials. The FCC order against Comcast’s blocking of peer-to-peer file transfers deals only with that company, but it may spur a variety of ISPs to change their broadband policies, such as by improving disclosure to customers of network management, said executives and analysts. The order, approved 3-2, said Comcast must fully disclose its network management and stop treating P2P traffic differently than other Web usage (CD Aug 4 p1).
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The buffer copies of programming that Cablevision’s system makes in order provide its remote DVR service shouldn’t be considered “fixed” copies under copyright law because they exist only for less than 1.2 seconds, Circuit Judge John Walker wrote in the decision. The system buffers a copy for a short period as it checks to see whether any subscriber wants to record it, but not long enough to qualify as a fixed copy, he said. Moreover, it’s the cable subscriber, not Cablevision, who decides when to start and stop a recording under the system. “We are not inclined to say that Cablevision, rather than the user ‘does’ the copying produced by the RS-DVR system” he wrote.
Because programs recorded by subscribers aren’t shared among other users when they watch them later, the system doesn’t violate the programmers’ public performance rights, the appeals court also said. In other words if hundreds of subscribers choose to record the same program, the system makes hundreds of distinct copies, and each subscriber views only the copy he or she made. “It seems quite consistent with the Act to treat a transmission made using Copy A as distinct from one made using Copy B, just as we would treat a transmission made by Cablevision as distinct from an otherwise identical transmission made by Comcast,” the judge wrote.
Executives at many ISPs are thought to be scrutinizing a test begun June 5 by Time Warner Cable. The company is charging new broadband customers in the Beaumont, Texas, area $29.95 monthly for a package letting them download and upload a total of 10 GB per month, said a company spokeswoman. A cap of 20 GB costs $44.95, while 40 GB goes for $54.90, she said. The company isn’t saying if it will expand metered packaging, said the spokeswoman. “We will gather the information and see once the trial is over” what to do next, she added.
AT&T may embrace broadband metering, Sanford Bernstein analyst Craig Moffett said, citing June 12 remarks by the company. “Given the usage trends we're seeing, a form of usage-based pricing for those customers who have abnormally high usage patterns is inevitable,” said an AT&T spokesman Monday, reiterating the company’s earlier remarks. He noted that AT&T’s stance isn’t related to the FCC decision on Comcast. “We're focused on a fair and affordable service for all of our customers,” he added. “Usage-based pricing is one way to deal fairly with Internet usage, which is very uneven among broadband users.”
Other companies probably are eyeing metered broadband, said Joshua Seidemann, vice president of regulatory affairs for the Independent Telephone & Telecommunications Alliance. But that could alienate customers, or at least decrease their broadband use, since people have grown to expect unlimited capacity since AOL began flat-rate pricing in 1998, said Seidemann, cable consultant Steve Effros and others. “The sort of network usage that just gobbles broadband and whatnot, it forces providers to put a lot of capacity out there, and it’s very expensive,” said Seidemann. “But by the same token, it’s that type of usage that drives demand.” A spokesman for USTelecom declined to comment on the FCC order, whose text hasn’t been publicized.
Usage-based pricing is “actually very common” abroad by many types of network provider, NCTA President Kyle McSlarrow said. In the U.S., such plans have “always been something that’s been on the table that people have looked at,” he added. But “it’s not obvious to me that that’s an answer to the problem of peak congestion issues,” he said. Expect to see more metering experiments, especially if it succeeds in stopping abusive P2P activity that saps network capacity, said Effros. “I wouldn’t be surprised if more companies went to metered use” even though they “don’t want to,” he added. “But it looks like the government is pushing them in that direction.”