TWC Mothballs New Metering Trials
Succumbing to consumer and political pressure, Time Warner Cable Inc. (NYSE: TWC) said it would sack plans to launch trials of a controversial consumption-based Internet billing system in four additional markets later this year. (See TWC Puts New Meter Trials on Hold .)
The MSO, which already has such a trial underway in Beaumont, Texas, unleashed a firestorm of criticism when it revealed plans to kick off similar trials in Rochester, N.Y.; Greensboro, N.C.; and San Antonio and Austin, Texas. Following an initial grace period, and depending on the tier, TWC planned to charge $1 to $2 for every gigabyte customers consumed above a fixed cap. Overage fees would not exceed $75 in any given month, however. (See TWC Dons Larger Consumption Caps and NCTA, Free Press Bicker Over Metering.)
Congressman Eric Massa (D-NY) has gone so far as threatening to draft legislation to stop TWC's plan. (See Congressman Mad About TWC's Internet Meter .)
Today, Sen. Charles Schumer (D-NY) was on hand in Rochester to join a protest against TWC's metering plans there.
TWC has argued that a metered model is becoming necessary to ensure that network costs don’t get out of hand as Internet usage continues to surge. Critics have maintained that operators like TWC are eager to enlist consumption-based Internet billing in order to stifle "over-the-top" Web TV services and to maintain Internet service subscription margins.
Although there were indications that TWC would stick to its guns and proceed with a new set of trials, the backlash evidently proved too much.
Time Warner Cable said it would suspend those efforts "while the customer education process continues."
"It is clear from the public response over the last two weeks that there is a great deal of misunderstanding about our plans to roll out additional tests on consumption based billing," said TWC CEO Glenn Britt, in a prepared statement. "As a result, we will not proceed with implementation of additional tests until further consultation with our customers and other interested parties, ensuring that community needs are being met."
Although TWC is putting new trials on hold, it's not scrapping the concept. Britt said the MSO continues to believe that consumption-based billing "may be the best pricing plan for consumers."
Also, the existing Internet metering test in Beaumont will continue on, a Time Warner Cable spokesman confirmed via email.
The MSO also confirmed that it's working on tools to help customers track their bandwidth consumption, and will make those available "as soon as possible."
— Jeff Baumgartner, Site Editor, Cable Digital News