Tiered Internet Pricing

Posted by: admin on April 16, 2009 @ 10:20 am
Filed under: Music Business News, Music Technology

A couple days ago, I heard a segment on All Things Considered about how AOL and a couple other internet providers are developing and rolling out a tiered pricing system. The deal is that the more data you use, the more you pay.  As the story below (from NPR’s blog) says, complaints are already starting to come in.

Since file-sharing has become such an issue for the music industry — how do we combat it? // do we need to combat it? // enough! just give it away already! — I’m still on the fence about this likely change in internet service.  Yes, it does seem fair for people who use more to pay more.  And this will most definitely cut down on sharing on torrent sites and the like.  But for those of us who have been and probably will continue downloading music LEGALLY, we might get screwed on this deal more than others.  A shiver went down my spine thinking of how much music I download, how much music is sent via our webstore, and how much I’m going to have to pay for accessing content in this way — especially those larger but great-sounding FLAC files and my Netflix Instant Queue.

I’m shaking in my boots.

All Things Considered, April 13, 2009 · Consumers watching their cell phone minutes may soon have something else to worry about: their Internet usage. Time Warner Cable and other Internet providers are adding fees if customers exceed a set amount of bandwidth each month. User complaints are already starting to roll in.

Time Warner plans to expand the reach of consumption-based billing, where consumers pay for a set amount of monthly bandwidth and then pay additional fees depending on the amount of additional data use. The policy covers everything from e-mail usage to downloading videos.

The policy, which was tested last year in Beaumont, Texas, will be expanded this summer and fall to Austin, San Antonio and other Texas cities, as well as Rochester, N.Y., and Greensboro, N.C.

Time Warner isn’t the only Internet provider to move in this direction. AT&T is conducting its own tests of tiered billing, and Comcast already sets a limit on how much data its residential customers can download each month.

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