Comcast Pricing Critics Undeterred By Announcement

Cable op gets some props for step in right direction, but concerns remain

By John Eggerton -- Broadcasting & Cable, 5/17/2012 6:44:29 PM

Comcast executive VP David Cohen told reporters that the headline on its announcement Thursday that it was changing its Xfinity data-use threshholds should be that there was no longer a cap, but critics of usage-based pricing saw it differently.

"Comcast Should Eliminate Punitive Data Caps Altogether," said Free Press, while Public Knowledge Legal Director Harold Feld also saw it as increasing the caps, but at least suggested that was going in the right direction, as did Netflix.

Free Press didn't seem to find an upside to the Comcast announcement, although the Company's new baseline, at least in a couple of testbeds, is 300GB, up from 250GB, with the 250 cap no longer enforced until Comcast figures out the best way forward for all its 18 million-plus ISP customers.

"Comcast has never had any legitimate reason to cap its Internet customers, and today's announcement of new overage charges is just another example of the cable giant's efforts to discriminate against and thwart online video competition," said Free Press Policy Adviser Joel Kelsey. "Data caps are not a reasonable or effective way to manage capacity problems, which are virtually non-existent for Comcast."

Cohen said during the call that only an extremely small fraction of users -- he would not put a number to it -- now approached the 250MB cut-off, and said the reason for the move was that a more flexible approach without that hard cap was more customer-friendly and was the right message to send to customers.

Feld was a little more optimistic, though he also saw it as raising the cap, not removing it. "Comcast recognized the need to increase the cap on data 'usage' that the company set in 2008," he said, "and to experiment with additional flexibility for customers. As Time Warner Cable's recent decision to offer a capped plan as a discounted alternative shows, more flexible pricing plans can benefit consumers where they offer opportunities for savings without compromising quality or an open internet. We await further details of Comcast's plan so that subscribers can fully assess how these changes will impact their user experience."

But Feld also said unanswered were the questions of how such caps are set, and why, and said Congress and the FCC should be investigating.

Suspending enforcement of the 250 MB caps while 300MB threshold was being offered to some was likely necessary to avoid criticism that Comcast was discriminating in bandwidth management, which could bump up against network neutrality rules. IPS are allowed to manage their networks, but cannot discriminate in the provision of that service.

Netflix, one of the online video competitors feeling thwarted, appeared somewhat encouraged but underwhelmed. "Increasing the data cap is a small step in the right direction," Netflix spokesman Joris Evers told Gigaom, "but unfortunately Comcast continues to treat its own Internet delivered video differently under the cap than other Internet delivered video. We continue to stand by the principle that ISPs should treat all providers of video services equally."

Comcast says that its Xfinity video service over the public Internet does count against the cap, but not the video delivered via an Xbox app through a set-top. That video, says Comcast, is not being delivered over the public Internet, so it's not subject to the cap. "It is a real stretch to create a discrimination argument," said Cohen Thursday. "Even Netflix, on its earnings call, acknowledged that a static 250 Gig didn't get into its way...  It's going to be a stretch that we haven't transitioned to an approach that is significantly pro-consumer and pro-innovation."

"We continue to stand by the principle that ISPs should treat all providers of video services equally," Evers told B&C/Multi.