Andre Yoskowitz
1 Dec 2011 13:03
Time Warner Cable and other ISPs are preparing to move to usage-based pricing for their Internet access, in the latest ploy to squeeze every last cent from consumers.
One analyst, Craig Moffett, of Sanford C. Bernstein & Co. says he predicts that either Time Warner, Cox or Charter will institute the pricing model in 2012.
So far, there have been no official moves to usage-based pricing in the U.S., but (of course), AT&T has been experimenting. Rogers in Canada has been using the model since 2008.
It appears that the ISPs, most of which are cable TV providers, as well, are scared of the exponentially growing usage of web video spurred by Netflix, Hulu, Amazon, Apple and more recently HBO and Google.
Time Warner, the second-largest US cable operator, says they lost 126,000 pay-TV accounts last quarter as more consumers "cut the chord."
The ISP tried to test tiered pricing in 2009 but overwhelming consumer disgust forced the company to drop the attempt.
Streaming services such as Netflix have vocally panned the move, which will force it (and other similar companies) to lose millions of subscribers.