The State of Data Caps
I’ve been seeing more and more about data caps lately. They’re everywhere. Mobile data plans have them. High speed broadband providers use them. Most famous is Comcast’s 250 GB per month cap. The way data caps are handled needs to be drastically changed.
Now I’m not ignorant to why these are in place. Yes, they’re to cut provider costs and maximize profits but the truth is that it’s expensive to actually allow unlimited data for the amount of people that consume data. The problem lies in how the caps are structured.
Comcast is the worst offender with its low cap for residential service so I’ll poke at them to start off. Their cap is 250 GB. It sounds like a lot but imagine an average family of four. The kids play a lot of video games, many of which are becoming available to download and even more of which are played online. The household is always on YouTube watching HD videos and they like to stream movies over NetFlix. If someone misses an episode of their favorite show, they catch up with it on Hulu. And let’s not forget all the music downloaded from iTunes. This adds up to a good bit of data. Maybe it won’t hit 250 GB every month but it’s definitely going to come close at least once or twice which is all it takes for Comcast to switch off service. The worst of it that Comcast counts downloads and uploads into this cap. More than ever, people are using internet backup solutions. These people will hit the cap, almost assuredly.
I’m not letting mobile plans off the hook either. I’ve been watching my own data usage and I’ve been averaging between 2.3 and 2.5 GB per month. Admittedly, this is quite a bit higher than the average user. In addition to the basics (email, internet, social networks), I use Google Music, Pandora, and the occasional NetFlix video on my phone. The data plans being introduced right now are starting at 2 GB. Just like with Comcast, the average user as of this moment is probably going to be fine.
But come this fall, that will all change. Why? iOS 5 and Android 4.0. Google is going to be ready to roll out Google Music to everyone who wants it. iOS 5 and iCloud are going to be rolling large amounts of data over the mobile networks. Even over wi-fi, uploads/downloads will be subject to Comcast or other residential internet providers’ data caps.
My point here is that these caps need to be structured to be scalable. Take the average user or user archetype and design data caps that way. Mobile networks are going to have to take the hardest hit and introduce minimum data caps at 3 or 4 GB, then up to 5 and 10. 2 is going to be too low for the data that is about to hit this fall.
As for Comcast? They need the bigger redesign. 250 GB is more than enough for a single user. Hell, 200 GB is probably more than enough for a single user. So set up plans: single user pack, family bundle, large family bundle (by request). The single user can be 250 or 300 GB, a marginal raise, to accommodate the bulk of apartment dwellers that live in 1 or 2 bedroom apartments with 1-2 people. A family bundle can be 500 GB that would more than suit 4-6 person families. Families with 7 or more people can request a higher cap of 750 GB. They can build these right out of the existing bundles with varying speeds (bonus: they’d be easier to market than names like “Performance” or “Blast!”). The caps can go lower if Comcast would only count the amount of data downloaded.
Some adjustments now will lead to much happier consumers and a much easier transition into the future. Failing to change now is going to cause a very painful end: internet will become classified as a utility. It’s already headed that way now. The private sector has to prove it can scale to accommodate the growing user base. Of course, this is going to be moot in the future. Internet will become a utility. It’s going to happen whether you want it to or not. It’s already a human right according to the United Nations. So if these companies are in it for the money, why not stave off the inevitable for a bit longer and make some more?
And let me stream as much of my music as I want while you’re at it.