Uncommon Wisdom

Aug 19 2009   6:03PM GMT

Fast Internet, pricing policies and the middle mile

Tom Nolle Tom Nolle Profile: Tom Nolle

Rogers Cable showed how different Canada and the U.S. are with its new DOCSIS 3.0-based offering. The service is 50Mb/2Mb, which is more asymmetrical than the U.S. market would typically offer, and furthermore it has a 175 GB/month usage cap.

In Canada, the notion of usage caps doesn’t generate the hysteria it does here in the U.S., but we believe that the only way caps would be avoided here would be by increasing the oversubscription levels of the middle-mile network, which would mean that users with “fast” Internet wouldn’t get proportionally higher effective speeds.

There is no way to legislate profitability or to set effective speed standards; Congress would never consider the moves, in our view. A realistic usage cap would benefit consumers by helping insure that they gained a real advantage from what’s likely to be an access speed war between cable and telcos.

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