An announcement from Time Warner (News - Alert) Cable has stated that they are planning to charge consumers $1 for each gigabyte of content over their allotment. This testing on metered Internet access will start in Beaumont, Texas.

 

Time Warner Cable is a cable operator in the U.S. dealing with the development and launches of innovative video, data and voice services. The company also delivers advanced products and services such as video-on-demand, high-definition television, digital video recorders, enhanced TV features, high-speed data, and Digital Phone.

 

The move has immediately drawn criticisms as it is seen as an abuse of regional monopoly. However, Time Warner Cable has maintained that this type of charging would actually help a majority of users since this would discourage the problem of 5 percent of customers using half of the capacity on local cable lines.

 

In an interview to AP Kevin Leddy, Time Warner Cable's executive vice president of advanced technology, said, “We think it's the fairest way to finance the needed investment in the infrastructure.”

 

Reuters (News - Alert) meanwhile reported that Time Warner Cable has new designs to provide multiple levels of service that would start at $29.95 per month for speeds of 768 Kbps, with a limit on downloads of 5 GB. This limit would amount to more than 340,000 e-mails, 170 hours of online games or downloading more than 1,300 songs.

 

At the high end, customers could pay $54.90 a month for download speeds of 15 Mbps and a limit of 40 GB, which amounts to 124 hours of standard-definition videos or downloading over 11,000 songs.   

 

Tech blogger Michael Arrington of TechCrunch criticized that Time Warner was limiting usage in order to get more customers into their network since there is little or no competition for Internet connectivity; they don't have to worry so much about losing customers.

 

This would highly affect innovations and development in field of online games and video-on-demand since those are largely depend on the type of connection the customer has.

 

"I am almost never in favor of government intervention of markets, but monopolies are an exception,” Arrington said. "We need to encourage data usage by consumers, not the opposite. The cable companies are standing in the way of economic growth and innovation.”

 

This is not the first time a cable company is addressing the problem of high usage among a relatively small group of subscribers. The Max Planck Institute reported that Comcast (News - Alert) is engaging in a bitter battle with BitTorrent clients by blocking them or throttling of BitTorrent files at all hours of the day, even though the company claims that it is just in the period of peak congestion. BitTorrent (News - Alert) is a peer-to-peer communications protocol that Web sites use to let people download movies and share files between their computers.

 

The Comcast-BitTorrent dispute has become a flash point in the ongoing debate of whether Internet providers should be forced to offer the same level of service to all users, regardless of protocols, applications, or download levels.