Comcast capitulates on data cap, but dodges net neutrality

Comcast Tower

Comcast plans to raise its broadband cap to 300 GB┬áper month as it trials two new ways to deal with managing traffic on its network, the nation’s largest cable operator said in a blog post today. The move is a welcome one for those who have hit the existing 250 GB cap, but it neglects to address some of the earlier complaints that have arisen in the last few weeks about Comcast exempting some of its own video on-demand trafficand allegations that the company is prioritizing that traffic in violation of federal rules implemented when it bought NBC-Universal.

What Comcast plans to offer

Comcast says it plans to trial two types of plans in unnamed markets. The first will offer customers a higher cap at higher tiers of service. So the Internet Essentials, Economy, and Performance Tier customers will have a 300 GB cap while those getting higher speeds (and Comcast offers some pretty high speeds at 100 MBps) will have some undetermined, higher cap. Customers under this plan will also be allowed to buy additional gigabytes for a certain amount. Comcast gave the example of $10 per 50 GB block.
The second trial will offer customers a 300 GB cap across all product lines and will offer customers a chance to buy more bytes for the same price. What’s key in both of these situations is that Comcast is allowing customers to buy more gigabytes after they hit the cap. Previously, it cut customers off. In this way it’s closer to capped plans such as those offered by AT&T, which stops users at a 250 or 150 GB per month cap and then charges them $10 for 50 more gigabytes.
The second approach will increase data usage thresholds for all tiers to 300 GB per month and also offer the option to buy more gigabytes. Comcast will also suspend the enforcement of its caps across all of its markets while it tests the new caps and plans.
While Comcast’s decision to expand its caps is good, it’s also sticking to the idea that unlimited broadband is detrimental to the quality of its network. In its blog post and on a conference call discussing the new plans, Comcast repeatedly tied these caps to better network management, but Comcast already has a network management plan that it filed with the FCC after it was caught blocking P2P packets on its network. In that plan, the company noted that when its network became congested it would temporarily slow traffic to customers requiring the most bandwidth. So why does it need the cap?

What Comcast doesn’t talk about.

Many argue that the cap is less about network management and more about protecting Comcast’s pay TV business as customers spend more time watching television via web-based subscription services including Netflix and Hulu. As I said, I’m glad Comcast has raised its cap, but conspicuously missing from the Comcast post is an admission that the cap is problematic when Comcast still offers to exempt some of its services from the cap.
When asked about this, David Cohen, Executive Vice President of Comcast, shut down the discussion, saying, “It is a real stretch to create a discrimination argument here.” He went on to say that the concern over any exempted services should be dramatically reduced because of the increased data threshold. “We’re relieving a hypothetical pressure on usage, here,” he said.
While the cap’s size has created some controversy as more and more customers hit it, the issue is less the size and more the existence of the cap if Comcast continues to offer services that will be exempt from that cap. Even at 300 GB per month, if certain types of traffic don’t count against that cap, then the cap still offers Comcast a competitive advantage over Netflix, YouTube and other over-the-top video services. Cohen repeatedly, however, mentioned a comment from the Netflix earnings call where the CEO of the streaming video provider said that a 250GB cap wasn’t affecting its business.
What Reed Hastings actually said was this:

It’s not a near-term issue with the 250 gigabyte cap. But the core principle [of network neutrality] is important anyway, which is the cap should be applied equally or not at all.

The larger cap also doesn’t address the question of whether or not Comcast is prioritizing its own traffic over other Internet traffic as was alleged earlier this week in a blog post by Bryan Berg, the CTO of MixMedia Labs. Comcast has explained why it believes it is not prioritizing its traffic in a manner that would draw government ire, but in a close reading of its post, what Comcast is describing is highly technical. Essentially it is saying that it is creating a logical as opposed to a physical separation in the traffic, and that it why it is marking packets.

Comcast wants you to feel free to use the web

So while Comcast is trumpeting its forward-thinking behavior on caps, there are a lot of questions about the timing of its announcement. Reporters on the call repeatedly asked Cohen about the rationale for increasing the cap. Cohen said its median usage is between 8-10 GB per month or about four percent of the cap and that the “vast, vast majority of users aren’t hitting the cap,” which does beg the question: why change the cap now?
Cohen’s response was, “It’s a matter of messaging way more than it’s a question of capacity.” He reiterated the idea that this is about encouraging users to use and download lawful content on their Comcast service without worrying about the cap. This implies that customers might find the cap inhibiting their behavior or that people questioning the cap are making some headway. So for now, customers get 20 percent more head room on their Comcast cap, and we’ll have to wait and see when and where Comcast rolls out its new plans.
Meanwhile I’ll leave you with Cohen’s suggested headline for this piece: “The headline today should be, we’re out of the cap business.”