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Predictable Survey Says…

Jeff Baumgartner
9/30/2008

1:00 PM -- Timing, as they say, is everything. Therefore, it follows that a survey showing that consumers aren't wild about Internet service consumption caps would show up the day before Comcast Corp. (Nasdaq: CMCSA, CMCSK)'s new 250 gigabyte consumption ceiling on "excessive" use goes live. (See Comcast Draws the Line at 250GB and Survey: People Don't Like Caps.)

A survey of 787 U.S. consumers conducted by International Data Corporation (IDC) for Zeugma Systems Inc. last month, found that:

  • 81 percent do not like the idea of establishing a bandwidth cap and charging for use above the cap.

  • 51 percent would try to change service providers if their broadband service provider imposed bandwidth caps. Findings also suggested that "light and moderate users" are even more opposed to capping and metering than are power users.

  • 83 percent either do not know what a gigabyte is or have no idea how many they use.

  • Only 5 percent said unequivocally that "those who use more should pay more."


"These last two points may come as a surprise to those believing that bandwidth caps are inevitable and that consumers are unwilling to pay more for better services," said IDC director of multiplay research Matt Davis, in a statement.

Although Comcast is applying its cap to bandwidth hogs, others are testing out metered systems that are tied into the business model. Among some examples in North America, Canada's Rogers Communications Inc. (NYSE: RG; Toronto: RCI) has rolled out a consumption cap that's coupled with overage fees. Time Warner Cable Inc. (NYSE: TWC) has been testing a metered approach in Beaumont, Texas. (See Rogers Takes Internet Meter to the Masses and TWC Tees Up Metered Internet Trial .)

But if caps and overage fees are scorned, what are consumers more willing to pay for?

According to the survey, 94 percent of respondents said they would find value in a service that allocates "premium bandwidth" for certain types of traffic, including video, VOIP, gaming, and VPNs. But keep that one under your cap -- no pun intended. The Network Neutrality zealots might not be so thrilled to hear it.

Another 26 percent said they would be willing to pay additional fees for "premium bandwidth services." So perhaps the hefty monthly fee Comcast is charging for its first Wideband deployment in the Twin Cities isn't so ridiculous after all. (See Comcast Enters the Wideband Era and Controlling Doc$is 3.0 .)

Zeugma, which has skin in this game with its "service delivery router" products, said the results should be viewed as "both an opportunity and a warning" for broadband service providers. Oh, and, of course, its customers, predictably, are "uniquely able to capitalize on these markets." (See Zeugma Rethinks Edge Routing and What Zeugma Isn't.)

— Jeff Baumgartner, Site Editor, Cable Digital News

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