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Charter tries to convince FCC that broadband customers want data caps

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Illustration of a water hose with Internet data trickling out of it, represented by 1s and 0s.

Constitution Communications has claimed to the Federal Communications Fee that broadband customers take pleasure in having Web plans with knowledge caps, in a submitting arguing that Constitution needs to be allowed to impose caps on its Spectrum Web service beginning subsequent 12 months.

Constitution is not presently allowed to impose knowledge caps due to circumstances the FCC positioned on its 2016 purchase of Time Warner Cable. The info-cap situation is scheduled to run out on Might 18, 2023, however Constitution in June petitioned the FCC to let the situation expire two years early, in Might 2021.

With consumer-advocacy teams and Web customers opposing the petition, Charter filed a response with the FCC final week, saying that plans with knowledge caps are “fashionable.”

“Opposite to Cease The Cap’s assertion [in an FCC filing] that buyers ‘hate’ knowledge caps, the marketplace presently reveals that broadband service plans incorporating knowledge caps or different usage-based pricing mechanisms are sometimes fashionable when the boundaries are sufficiently excessive to fulfill the overwhelming majority of customers,” Constitution informed the FCC.

Constitution’s submitting continued:

There may be additionally proof that some customers—both those that don’t devour a number of knowledge and/or those that are searching for a lower-cost plan—might desire a service the place costs are primarily based on the quantity of knowledge used… These completely different plans are proliferating available in the market as a result of they provide customers a cheap various to limitless knowledge plans which can be greater than enough to fulfill their wants. The DC/UBP [data caps and usage-based pricing] Situation, nevertheless, prevents Constitution from conserving tempo with its opponents and providing customers the sorts of plans they’re searching for. Whereas Constitution sees worth in offering its service with out knowledge caps or UBP and has no plans to alter that apply, Constitution moderately seeks the identical flexibility that every one of its opponents and friends need to handle knowledge utilization. This fashion if circumstances change, it has flexibility to supply the service packages its prospects need.

Constitution uncared for to say that home-Web suppliers typically do not cost prospects much less after they do not use a lot knowledge. As an alternative, the worth is normally the identical no matter whether or not one makes use of 10GB a month or 1.2TB. Cable prospects who exceed an information cap need to pay additional charges, however apart from some limited exceptions, they do not get a reduction off the bottom value after they keep below the cap.

Constitution pointed to Comcast’s 1.2TB monthly data cap and the truth that most prospects do not use that a lot knowledge as proof that “the market doesn’t help unreasonable knowledge limitations.” However Comcast—like Constitution—is the one high-speed cable or fiber supplier for tens of millions of customers throughout the USA, so Comcast prospects do not have a lot selection. Comcast imposes its cap in a lot of the states it operates in, however not within the Northeast US the place it faces robust competitors from Verizon’s un-capped fiber-to-the-home FiOS service—proof that “the market” discourages caps when ISPs face actual competitors.

Constitution additionally claimed the merger situation “prevents Constitution from growing revolutionary service plans which can be extra tailor-made to customers’ wants,” however there may be nothing stopping Constitution from providing cheaper plans to prospects now and differentiating plans by pace as a substitute of knowledge allotment. Actually, Constitution already does that by charging completely different costs for various speeds and by providing a low-cost plan with 30Mbps speeds to low-income families.

Constitution: Lack of competitors is “inappropriate”

Constitution’s petition additionally asks the FCC to raise a situation that forestalls the corporate from charging network-interconnection charges to massive on-line video suppliers.

Constitution claimed that it faces adequate competitors from wireline, cellular, and satellite tv for pc suppliers. However Constitution additionally argued that “Opponents’ claims that the [broadband] market shouldn’t be aggressive are inappropriate… as a result of Constitution, like different broadband suppliers, lacks the motivation or means to discriminate in opposition to OVDs [online video distributors]. OVDs are vital to the [broadband] enterprise and much too massive and highly effective to thwart with knowledge caps or interconnection charges.”

Constitution’s petition mentioned that in June this 12 months, “residential knowledge utilization for Web-only prospects was 600 gigabytes monthly, up practically 20 p.c from the fourth quarter of 2019 attributable to pandemic-related working and studying from residence.”

Roku: Knowledge caps needs to be “a relic of the previous”

Constitution’s petition is opposed by consumer advocates, a whole bunch of shoppers who submitted filings to the FCC docket, and Roku.

“If it have been to sanction knowledge caps within the absence of aggressive broadband Web entry providers, the Fee wouldn’t solely enable Constitution to behave on its incentives to behave anti-competitively but in addition sign to different broadband suppliers who’re unconstrained by competitors that they too are free to undertake anti-competitive measures. Knowledge caps ought to turn into a relic of the previous,” Roku informed the FCC final week.

Constitution additionally faces opposition from Incompas—an business group that represents Netflix, Amazon, different on-line service suppliers—and a variety of companies within the telecom enterprise. Constitution has gotten help for its petition from charities and politicians it donated to, as we detailed in a previous article.

However Constitution apparently wrote letters on behalf of charities, and one of many teams has mentioned it does not really help Constitution’s petition, Bloomberg reported yesterday:

When requested by Bloomberg Information about a letter filed July 20, the Niagara Falls Boys & Ladies membership, which obtained $5,000 from Constitution for a summer time camp, backed away from its help for the measure Constitution is looking for from the FCC.

The letter the membership submitted was ready by Constitution and “upon nearer assessment, the final paragraph of the letter states that we help” Constitution’s request, Rebecca Vincheski, chief govt officer of the membership, mentioned in an electronic mail.

The membership has “a place of neutrality on this necessary neighborhood subject,” Vincheski mentioned.

The deadline for submitting responses to Constitution’s petition handed on August 6. FCC Chairman Ajit Pai voted in opposition to the merger circumstances after they have been imposed in 2016 below then-FCC Chairman Tom Wheeler and will ask the Republican-majority fee to vote on Constitution’s petition within the coming months.

Disclosure: The Advance/Newhouse Partnership, which owns 13 p.c of Constitution, is a part of Advance Publications. Advance Publications owns Condé Nast, which owns Ars Technica.

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