The confluence of two huge events in the world of tech — the Comcast-TWC merger and the potential death of net neutrality — might have even wider reaching effects than expected for consumers. Speaking with investors on Wednesday, Comcast Executive VP David Cohen announced that the company is expected to implement a “usage-based billing” system within the next five years, effectively capping data usage for subscribers.
“People who use more should pay more and people who use less should pay less,” said Cohen.
Comcast has already begun rolling out “pilots” in smaller markets to test the usage-based pricing model:
“When we started we had two basic models, one is depending on the tier of service you bought, that’s how much capacity we would give you in a month. […] Then we had a model where everybody got 300 or 350 [GB] and you could buy extra packages of 10 meg each as you went through them for $10. And tentatively, we are not there yet, it seems like the second model is preferable to consumers than the first model.”
When analysts questioned whether this new billing model would come into play during the Time Warner Cable merger review, Cohen said that data caps have nothing to do with the transaction, but is actually “a generic industry-related issue” which people have tried to make “an open Internet issue.” In simpler terms, Cohen doesn’t want Comcast caught in the net neutrality crossfire.
In an interview with Ars Technica last year, Comcast said that “98 percent of our customers nationally don’t use 300GB/month.” Cohen reiterated up that claim on Wednesday and said that “I would also predict that the vast majority of our customers would never be caught in the buying the additional buckets of usage, that we will always want to say the basic level of usage at a sufficiently high level that the vast majority of our customers are not implicated by the usage-based billing plan.”
