TWC Rethinks Its Broadband Strategy
While most MSOs never wanted to be in the hardware business, Time Warner Cable Inc. is trying to make the best of it. Unfortunately for its subscribers, that could mean higher modem rental fees again.
According to DSLReports, Time Warner Cable has started sending out notices informing customers that cable modems will soon cost another $1 per month to rent. The cable company implemented a modem rental fee of $3.95 per month in October 2012 and then reportedly raised that charge to $5 for new customers in June. Now the fee is climbing again to $6 per month for at least some subscribers as the end of summer approaches.
TWC says the higher fee is offset by a 50 percent increase in speed for its most popular Internet tier. In justifying the rate hike, the MSO also points to the availability of more than 150,000 free cable Wi-Fi hotspots nationwide. (See Cable Wi-Fi on a Hot Streak.)
Meanwhile, select Time Warner Cable customers can get a break on their broadband bills if they agree to a metered broadband plan. In some markets, TWC is offering a discount to users who opt for a cap of 30 gigabytes per month. Any usage over that amount will generate a fee of $1 per gigabyte.
While metered broadband is potentially a good deal for some consumers, it's not terribly appealing to users who want to streams video content over the Web. When Time Warner Cable tried to impose metering back in 2009, consumer backlash pressured the cable company into reversing the policy. (See TWC Mothballs New Metering Trials.)
Now, in 2013, the MSO is using pricing discounts as an incentive to bring the practice back. Maybe the carrot will work better than the stick this time around.
— Mari Silbey, Special to Light Reading Cable