If you are a Comcast consumer, your binge-watching days might be just about over — unless you are willing to pay extra for it.
Up until now, Comcast subscribers could stream videos on online services such as Netflix and YouTube for as long they wanted to. However, now, the cable giant has begun imposing extra fees on customers whose data usage surpasses the arbitrary limits set by the company.
As Bloomberg reports, Comcast Corp. is testing metered streaming in cities including Atlanta, Nashville and Miami by hitting people with $10 for an additional 50 gigabytes once they exceed 300 gigabytes each month. The data limit set by the company is equivalent to five hours of high-definition video streaming per day.
It means if you live in a household with, say, more than five adults who stream at least one TV show a day, you’ll have to put your binge-watching habits to rest for an indefinite period of time — or until you get a new service provider.
“It leaves a bad taste in your mouth,” consumer Jonathan Strong, whose family watched Netflix every night, told Bloomberg, noting that he pays as much as $20 in extra charges each month. “It feels like we’re getting punished for our normal use.”
Interestingly, the cable giant has said its plan for usage-based billing, which is reportedly common in the wireless industry, is all about “fairness.” The company argued that customers who only use the Internet to check their email should not pay the same amount as those who use the service for binge watching and online video games.
Chief Executive Officer Brian Roberts even went as far to liken it to buying more gas after driving long distances or paying higher bills to run the air conditioner.
Theoretically, he might have a point, but Craig Moffett, an analyst at Moffett Nathanson, explained Comcast’s flirtation with metered pricing to be “an insurance policy against cord-cutting.”
“What’s at stake is nothing less than the basic business model of the cable operators,” he said, adding that usage-based pricing is what ensure pay-TV companies that they will still be paid for their services in the future even if their user-base shifts towards online services such as Netflix, Amazon or Hulu.
There is also another aspect to this entire situation. Not only will the cable providers earn more dollars, the higher data costs will also make online streaming look a little less attractive — just when these companies are beginning to provide valuable original content.
“Users hate wireline data caps because they create artificial scarcity that increases the cost of getting online,” said Noah Theran, a representative for the Internet Association. “To make matters worse, limited competition in the high-speed broadband market means users often have nowhere else to turn for a better deal.”
Banner / Thumbnail : Reuters