FTC's Liebowitz speaks about tiered broadband pricing at the Cable Show

Public Policy Discussion with FTC and FCC Commissioners [The Cable Show Blog]

This year's Cable Show featured a lunch session with an FCC and an FTC official – FTC Commissioner Jon Leibowitz and FCC Commissioner Mignon Clyburn – to discuss a variety of public policy and regulatory issues facing the cable and broadband industries. The panel discussed topics ranging from geolocation data collection to net neutrality and broadband deployment.

The panel also touched on broadband pricing plans when NCTA's James Assey asked Commissioner Leibowitz for his thoughts on tiered pricing plans for broadband that charged higher rates to users who consumed greater amounts of a data. 

Leibowitz expressed surprise that more tiered pricing plans had not already worked their way into the market. Leibowitz said that just about every other product on the market was sold based on the volume used by customers. It only makes sense, according to Leibowitz, that broadband would be treated the same.

Leibowitz did go on to state that tiered pricing plans would need to be fully disclosed and explained to consumers so that they fully understood the terms of the plan they were receiving.

Comments

[Thienthu]

I just found your site and the post made by Patricia Mounts is so right on. We have to go outside to use our cell phneos and with tv you only have 2 choices (forget the antenna, too many trees and the wind blows too hard). We can get DSL but it costs 49.00 + a charge if you ever have a problem and that totals 57.45 a month. That is the lowest priced package and it's not always good if a lot of people are on it. We are tired of hearing how everyone wants you to pay online and bank online when you just barely have internet in the rural area. Of course we do live in SE Kansas and we don't seem to be a part of the real world or they are not aware of us. If you do get anything it's so costly you can't afford it. We know businesses need to make money but it seems any more everyone is out to rip you off. What a sad day when your business means nothing!Sorry I didn't read this when it was first posted but this is something that had bothered us for a long time.

[Chiqqa]

Ensure that the connection is ueteftnred and available to anyone using the net. Restore the peer to peer connection by using Ipv6. Define what exactly is broadband and Highspeed. It should also be a minimum speed of 1.5 meg for basic connection and 5 meg for standard and say no to quota's. They are a good idea on the technical side, but the business side will use this as a means to make more money than they should. Rant 45 dollar a month for inconsistent speed and questionable up time is wrong. Basic network connection should be no more that 25 dollars a month. Be able to choose any ISP I want not be lock into single provider and the no long term contracts. Force the ISP to give the customer good prices and customer service. Maybe look into government control of the nations backbone connection, likely not a good chose, but rules need to be implemented. The internet has turned into a utility not a service and should be treated as such.

[Rayan]

Demarchand Ok sure, thats a neat idea Finally allow 2.4GHz band communications on fgtlhis, since they have never been proven to cause any kind of interference with flight communications [which are not typically in the microwave band]. And now that consumers want it so badly, I'm sure they will be charged $10 USD per minute [or maybe by per KB] to go wireless Anyone who lacks the ability to circumvent the toll based access points is gonna get wallet-raped.Stinks of wait until users will do anything to get out of the stone age, then charge them whatever we feel like it' tactics to me.I'll just be sniffing all of the trade secrets and must by from SkyMall NOW' credit card information on the in-flight network. March 22, 2008 | 3:28 am

[William Hurlston]

Obviously, Leibowitz is an idiot who has no idea of the difference between a "consumable" product (where consumption by volume depletes the overall supply) and digital bit/bytes. Apparently, common sense and/or intelligence is not a requirement for holding a position of authority at the FCC.

[Paul Templeton]

I keep hearing the comparisons to power and water. How much we pay for those based on how much we use. That internet access should metered the same way.
First of all we are ALREADY capped and tiered by the speed of our connection. A 20.0 customer does not have the opportunity to download as much as a 50.0 customer can in a given amount of time, so we are already paying for a tiered service that has physical caps in place.
Secondly the power and water companies are providing the product along with the system to get it to your home. The cable company doesn't make the internet, they just provide the system to get it to your home.
A closer analogy would be cable TV where they don't create the product, they just provide the system to deliver the product to your home.
You pay for a level of service (amount of channels) and that is it, you aren't limited to how much you watch those channels once you have them.

[Paul Templeton]

Well if it stops the "unlimited" lie and the top tier is offers a good amount of bandwidth at a reasonable price.
As more and more services are handled by the web such as phone, TV, ect.... I don't see how tiered plans make much sense as the lines between web usage and those services become more blurred.
Even without being a part of the net my TV takes X amount of bandwidth on your system. I pay for a level of service. Would it be right to then charge me based on how much I actually watch my TV?
No because you know the customers wont stand for that so you build the system with the ideal that most would use it.
The simple answer is to do the same with net access.

[JDF]

Or Insight... It's obvious Michael's drinking the kool-aid as well... The only people that want tiered broadband pricing by usage are ISP executives...

[Nate]

Next month we will hear about Leibowitz taking a position at Comcast or ATT.