Time Warner Cable Broadband Tiers Lead to Fears

Is Time Warner Cable crazy? As I review the pricing plans unveiled today for the broadband and cable provider’s tiered levels of service, I can’t help but wonder that. Earlier this year, the company said it would experiment with tiered pricing in Beaumont, Texas, and now has set up a pricing plan that ranges from $29.95 a month for something I’d call “barely broadband” at 768 kilobits per second with a 5-gigabyte monthly cap to $54.90 per month for 15 megabits per second and a 40-gigabyte cap. Overage fees will be $1 per gigabyte, and customers will be able to monitor their bandwidth consumption via the company’s web site.

The pricing takes effect Thursday in Beaumont but Time Warner Cable says it doesn’t know if and when it will try this elsewhere. I’ve got a personal stake in this story as Time Warner Cable is my current ISP. I pay about $35 a month for my connection, which is between 1 and 1.5 Mbps, and stream a lot of content from sites such as Hulu and iTunes. Plus, I’m constantly downloading software from the web in the form of fat updates or just to try things out.

On the other hand, it would be worth it to pay more to get a 15 Mbps connection if that’s indeed what I would get, but the bandwidth cap would limit me to watching about 40 hours of standard video content from my PC a month, plus my regular surfing habits and email use. (I suppose this is more transparent than P2P throttling, though).

But here’s where I question Time Warner Cable’s sanity: By offering tiered service at 15 Mbps it’s promising me faster speeds that I will have limited opportunity to use, potentially driving me into the arms of another provider. Additionally, the cable guys are in a fight to the death with the telephone companies, who are unlikely to resort to such plans because they don’t have the same limitations when delivering last-mile services.

For people who get or send a lot of media online, neither of Time Warner Cable’s tiers are a good option, which means they’ll have to turn to other providers. For me, that means DSL from AT&T, as U-verse or FiOS isn’t available in my area. And for a technology teleworker, that’s the equivalent of giving an engineer a slide rule. I don’t think Time Warner Cable will win by trying to hold back changes wrought by ubiquitous broadband with a pricing plan, but it seems hell-bent on trying.