The days of all-you-can-eat bandwidth appear to be numbered.
AT&T, one of the largest broadband providers in the country, has set usage caps as an experiment in Reno, Nevada.
Under the plan — which became effective Nov. 1 — new AT&T broadband customers in Reno will be capped at 20 GB to 150 GB per month, depending on the plan. And later this year, existing AT&T customers will be subject to the same caps if their usage exceeds 150 GB per month, according to a document filed with the FCC by the company. Users who go over the limit, will be given a one-month grace period, after which point they'll be charged $1 for every GB they use over the cap.
The company is following in the steps of many other broadband providers — most notably Comcast, which set a 250-GB cap in August — who are setting limits on broadband use in an attempt to crackdown on so-called "bandwidth hogs." Time Warner Cable has tested a tiered service in
Texas with caps ranging from 5 GB to 40 GB; Canada's Rogers set its cap at 60 GB; and New York-based DSL provider Frontier recently announced a measly 5-GB cap.
While analysts have argued that mostly cable operators need to worry about bandwidth constraints, AT&T has proven that's not the case.
The company isn't just concerned about protecting its capacity.
Profit motive must play some role in the company's consideration of bandwidth caps, says Forrester Research analyst Sally Cohen.
"They're trying to think strategically about how to monetize the network," says Cohen. "Consumers are going to need more and more bandwidth over the next five years, and AT&T is walking a fine line between preserving resources and figuring out how to increase revenue per user."
It's a point AT&T alluded to when it said the caps will help the company to "evaluate ways of dealing with surging usage trends while continuing to meet customer needs for a high-quality broadband experience at an affordable price."
Meanwhile, Verizon, one of the few companies holding out on broadband caps, says it has no plans for implementing broadband caps in the near future.
"That's not to say it won't ever happen. But at the moment we have plenty of capacity and we're happy to deliver to our users as much bandwidth as they require," said Verizon spokesman Jim Smith.
Photo: downing.amanda/Flickr
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