Telecoms to Cap Bandwidth and Impose Usage Fees

Tuesday, March 15, 2011



AT&T is joining Comcast and other Internet service providers in capping the amount of data customers can access and imposing higher fees for those who exceed bandwidth limits.

Customers will be subject to a tiered-fee scale based on usage, with additional charges levied incrementally for higher volumes of use.

AT&T proposes an initial cap at a volume of 150 gigabytes per month for subscribers, with another $10 charged for each additional 50 megabytes accessed.

"The top 2 percent of residential subscribers uses about 20 percent of the bandwidth on our network. Just one of these high-traffic users can utilize the same amount of data capacity as 19 typical households," a release from AT&T states.

"Lopsided usage patterns can cause congestion at certain points in the network, which can slow Internet speeds and interfere with other customers' access to and use of the network."

"Our new plan addresses another concern: customers strongly believe that only those who use the most bandwidth should pay more than those who don't use as much. That's exactly what this does – and again, 98% of our customers will not be impacted by this."

Critics of the new business model say the limits could stifle innovation by significantly decreasing the amount of Internet use by some consumers.

Services like Netflix and other companies that provide streaming media could be impacted, as users would need to limit themselves to an average of less than ninety minutes of media per day to avoid the increased fees.

AT&T's bandwidth cap will begin on May 2.


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