foobar on computers, software and the rest of the world

Metered broadband in the US, very nice pricing if you are used to NZ prices

, posted: 4-Jun-2008 12:46

Metered broadband is rare in the United States. Time Warner is now introducing it in one market as a trial. Looking at their pricing makes me just wish we would have more competition here in New Zealand. From the article:
$29.95 a month for a 5GB cap and 768kbps download speeds to $54.90 for a 40GB cap at 15mbps. ... If customers exceed their bandwidth cap ... they'll be charged an extra $1 per extra gigabyte.
Even if I translate this to NZ$ (with a rough 1/1.3 exchange rate) I still get attractive prices. For the 40 GB plan, it would be around NZ$ 71. 40 GB a month would cost me around NZ$ 90 right now here with Xnet with a rather paltry 0 (zero!) GB bandwidth included and around NZ$1 per additional GB. And while I know that the actual download speed depends on the distance from the exchange and other factors, I can only dream of 15 mbps, of course.

Anyway, dreaming must be allowed...


Other related posts:
Attack on net neutrality right here in New Zealand
How about: Three strikes and YOU are out, Xnet?
ISP filtering in Australia: Think about the children!

Comment by sbiddle, on 4-Jun-2008 14:52

More importantly is the reason they are doing this - P2P

"According to Time Warner, 5 per cent of its customers eat up half the capacity on its network."

Flat rate internet is history. People are soon going to have to accept 9whether we like it or not) that traffic shaping is going to become the norm as well.

Author's note by foobar, on 4-Jun-2008 15:02

@sbiddle: Yes, no doubt. P2P is eating into the margins of the 'flat' providers. That's why 'flat' hasn't really been flat for quite some time. Before you know it, you are being rate-shaped, or otherwise restricted.

Anyway, the point really is: In a metered scenario I think the ISPs have less incentive to pay for rate shaping equipment, since they can just charge me more. So, why should they limit me? This in turn should mean that I at least am able to use more bandwidth if I absolutely have to, and in the way I want to. Honestly, I am rarely using much more than 5 GB a month, but I don't want to be limited if I have to use more for some reason, and I don't want to run into pesky BitTorrent filters if I have to use that for something.

If ISPs can charge me for additional bandwidth, I would hope that they actually let me use this additional bandwidth they charge me for. In the metered scenario. people will not just blindly run P2P day in and day out, unless they have money to burn. So, the usage of P2P should self-regulate. As a result, the overall experience for 'the rest of us' might actually improve, no?

I really don't mind metered service, and I can understand why flat rates are not really a viable option for ISPs, what with their thin margins and all. But just wish it would be a little bit cheaper here in New Zealand.

Comment by OldGeek, on 4-Jun-2008 15:02

As I understand it currently US ISPs offer all-you-can-eat broadband plans. If this is correct then the context of this pricing is that the ISP wants customers to move from uncapped to capped plans - and the only way to do this is to offer capped plans at a really cheap price. So are these prices really low? It depends what the erquivalent uncapped plan pricing is - but these 'low priced' capped plans dont look spectaclarly cheap to me.

Author's note by foobar, on 4-Jun-2008 15:10

@OldGeek: No, they are not at all spectacularly cheap. For spectacularly cheap there are some prices in Europe, Scandinavia and Asia to check out (so I have heard).

My point was: They are cheaper than what you'd get here in New Zealand, and offer much more bandwidth included. In fact, with 40 GB included in the price, it would almost be like a flat fee for me, since I don't think I ever had the need to download that much in a month.

Sure, the prices might be a bit lower because customers need to be lured, but because there are so many flat rates there to compete with that, I think we will see similarly (or even lower priced) options for quite some time to come.

And as I said in my comment above, once customers start to pay for 'excess' bandwidth, the P2P issue should begin to self-regulate for the ISPs, and they have less incentive to start managing my bandwitdh for me, which is good because I want the option of using my bandwidth in any way I want.

So, if that is a side effect of metered service then I am all for it.

Comment by hellonearthisman, on 4-Jun-2008 16:59

They have found a way to make money from the p2p downloaders

Author's note by foobar, on 4-Jun-2008 17:22

@hellonearthisman: Yeah, I understand that. But ISPs do indeed have very thin margins. I don't quite see why 5% of the people using up most of the ISP's capacity should cause restrictive and invasive bandwidth management for the rest of us. If metered service is causing them to download a few less things then I am fine with that.

Everyone's freedom to be able to do with their bandwidth what they want and when they want is worth more than ability for some download a few more gigs for free.

This is - of course - assuming that the ISPs don't introduce restrictive bandwidth management on top of the metered service. I would think they should have somewhat less motivation to do so then.

Comment by KiwiOverseas66, on 4-Jun-2008 19:41

I think its kinda of interesting when you see articles like this, and realise that despite the size and strength of the US telco sector, not to mention the wealthier consumer base it has to draw from (the average wage in the US is something like USD 46k per annum, where as in NZ its USD 23k per annum) - margins are still tight and providers have the same user issues as they do in NZ.

When comparing prices between the US and NZ - I know the accepted wisdom is that we need more competition. I'm inclined to think we need about 4 times the current population and about USD 10k per annum wage increase on top of that! ;-p

Author's note by foobar, on 5-Jun-2008 04:49

@KiwiOverseas66: I think that in the end one really can't just compare dollar values from one country to the next. The actual purchase power needs to be taken into consideration. Just because the average income there is US$ 46k, vs US$ 23k here, doesn't mean that people there can afford twice as much. After all, they need to buy things priced in US$, and if you employ someone, you need to pay them in US$ ... on average US$ 46k a year.

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New Zealand

  • Who I am: Software developer and consultant.
  • What I do: System level programming, Linux/Unix. C, C++, Java, Python, and a long time ago even Assembler.
  • What I like: I'm a big fan of free and open source software. I'm Windows-free, running Ubuntu on my laptop. To a somewhat lesser degree, I also follow the SaaS industry.
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