Wednesday, December 8, 2010

Usage Charges: The Bane of Internet TV

The Washington Post published an article describing how the FCC is supporting broadband usage charges. This means that you would have to pay on a per megabyte basis. In addition to your monthly fee to Netflix, you would have to pay a fee to  your broadband provider every time you watched a movie.

Now, it is likely that a usage based broadband plan would include some number of megabytes before the usage charges kicked in. However, these allowances will probably only cover a couple of films per month in addition to normal Internet traffic.

Usage charges will be set high enough to make Netflix streaming and other Internet TV services expensive enough to reduce their competitiveness against the broadband provider's own TV offering.

This is a great idea for the broadband providers and a bad idea for us users.

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