from the arbitrary-limits-on-innovation dept
For years broadband providers have increasingly imposed arbitrary, confusing, and punitive usage caps and overage fees to cash in on the lack of competition in US broadband. Not only have industry executives admitted these limits aren’t technically necessary, they’ve increasingly been abused to hamstring competitors. AT&T, for example, doesn’t impose the limits on its broadband customers who use its own creatively-named streaming video service (AT&T TV Now), but will impose the added charges if you use a competitor like Netflix.
For more than a decade ISPs have slowly but surely imposed such limits hoping that consumers wouldn’t notice (think of the frog in the pot of boiling water metaphor with you as the frog). But as video streaming services have increasingly embraced high-bandwidth 4K streaming, consumer usage has started to collide with these arbitrary restrictions. And with new game streaming services like Google Stadia on the horizon (which eliminate the local console and stream everything from the cloud), the public is about to get a crash course in the stupidity of these unnecessary limits.
At full 4K resolution, Stadia, which launches in November, can consume upwards of 15 gigabytes per hour. When you figure that many ISPs (like AT&T’s DSL services) impose caps as low as 150 GB per month before socking you with costly overage fees, you should be able to see the problem. A new study by broadband availability tracking firm Broadband Now shows that around 6 million of the US’s estimated 34 million daily gamers will run afoul of their caps in the months to come. Since a sizeable chunk don’t even know they have caps, that’s going to create some bill shock for some:
According to data from The NPD Group, America’s estimated 34 million gamers play 22 hours per week on average. Were those gamers to all shift to Stadia as their primary game platform at 4K, they’d burn through 1,386 GB of data monthly. And that’s just the bandwidth consumed by gaming; it doesn’t include music and video streaming or other activities.
The result will be an even higher broadband bill for US consumers who already pay some of the highest prices in the developed world for bandwidth. For many this will be a surprise. Of the 943 gamers surveyed by the company, only 17 percent were certain they had a broadband cap. 21 percent say they weren’t sure one way or the other whether their broadband was metered.
Again, there’s no reason for these limits to exist outside of telecom industry greed. Even the telecom industry has (after years of criticism) acknowledged they don’t actually help manage congestion, and serve no real technical purpose. They’re a glorified price hike and the clear result of the lack of competition in broadband. In an interview with Gamespot earlier this year, Google VP Phil Harrison tried to downplay the impact caps would have on the service, insisting the broadband industry has a long history of staying ahead of consumer demand:
“ISPs have a strong history of staying ahead of consumer trends and if you look at the history of data caps in those small number of markets…the trend over time, when music streaming and download became popular, especially in the early days when it was not necessarily legitimate, data caps moved up,” he said. “Then with the evolution of TV and film streaming, data caps moved up, and we expect that will continue to be the case.”
Except that’s not true. AT&T’s 150 GB DSL cap, imposed in 2011, hasn’t been hiked once. Comcast’s 300 GB cap has been hiked exactly once in the last decade (to 1 terabyte) since it was imposed. There’s no competitive incentive to raise or eliminate these caps because these companies face little to no competition and (now thanks to the Ajit Pai FCC) even less regulatory oversight. And while Stadia games can be streamed at a lower resolution to conserve bandwidth, that deflates Google’s quest to have Stadia be a symmetrical equivalent to game consoles like the Switch, Xbox One, or Playstation 4.
Another looming wrinkle in this saga? The death of net neutrality. AT&T already uses usage caps to penalize customers for using a video streaming competitor like Netflix or Hulu, allowing it to use its broadband monopoly to tilt the playing field in its favor. With ISPs working on their own cloud game streaming platforms–and the FCC having just abdicated its authority to police such behavior–can you perhaps see a looming issue? Google abandoned giving a damn about net neutrality circa 2010 or so, and with game streaming, that decision may just come home to roost.
In the interim, get ready for 2020 to be filled with sudden complaints about broadband usage caps, and lots of tap dancing by the telecom industry as to why these arbitrary, punitive limits exist in the first place.