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Why don’t cable companies charge by megabyte used, instead of by speed? That way they would have an incentment to give you the fastest possible connection, sinc

Why don’t cable companies charge by megabyte used, instead of by speed? That way they would have an incentment to give you the fastest possible connection, since that would potentially mean, that you would be consuming more data. They might even give you a discount on your Netflix subscription. Is the current pricing structure simply because consumers have become so accostumed to playing a flat rate, or is there something else, that I am missing?

gleenn 8y ago
You're assuming they are trying to make the service the best they can. They've obviously done the math and it's cheaper to charge people a flat fee. They don't really care how good their service is, or how fair it could be, just that they maximize profit.
jbob2000 8y ago
> Why don’t cable companies charge by megabyte used, instead of by speed? Because they can and do charge you for both and laugh all the way to the bank.
rhino369 8y ago
Customers would hate having to consider how much data they are using.
- ocdtrekkie 8y ago
  The rate would likely be relatively proportional: On average, with usage based pricing, people would pay about the same. But heavy Internet users would pay more and lighter users would pay less.
zmarty 8y ago
Bandwidth is not a finite physical resource. The marginal cost to add more capacity is tiny. Their cost to serve is tiny. I HATE data caps.
- janaagaard 8y ago
  If you payed by the megabyte there wouldn’t be any reason to put a cap on consumption. Just sayin’. ... But that being said, I certainly can relate to what you mean. Charging by the megabyte would require a very, very low price per megabyte for this to be acceptable.
lunchables 8y ago
Why charge for one when they can charge for both? (They already do, read your terms of service carefuly)
CobrastanJorji 8y ago
> Why don’t cable companies charge by megabyte used, instead of by speed? Because "speed" sells, and the customers Comcast wants don't use much bandwidth. The #1 source of revenue for Comcast is the customer who has cable, has high speed Internet, doesn't really use the Internet for much, and just pays their cable bill every month without really thinking about it. The family with 3 teenagers all watching Fortnite live streams or whatever the kids are doing these days is Comcast's second worst customer, only superseded by the guy streaming those videos.They're taking up a significant chunk of their area's local bandwidth, and that costs real money to upgrade. Comcast has no incentive to allow for this use case unless they can find a price tier that makes you a good customer again (notice that for $50/month, Comcast will remove the bandwidth caps). It's effectively the same reason that Comcast doesn't let you sign up for individual cable channels.
- lsaferite 8y ago
  I have 1Gb + unlimited data right now. I regularly use 1.2-1.5TB of data every month. I'm sure they hate me almost as much as I hate them.
geodel 8y ago
Well you are missing the angry rant of tech savvy customers about charging per mega/giga bytes. They want flat rate and unlimited data.
forgottenpass 8y ago
Before overselling internet access was commonplace, you bought based on guaranteed physical capacity (i.e. bandwith). Even with overselling, their network is still bound by that capacity. So they charge for both.
ocdtrekkie 8y ago
I've long been a proponent of usage-based pricing because it aligns the incentives of the business with the consumer: They want you to use more data, so they have the best interest to get you as fast of service in as many geographic areas as humanly possible. But wireline carriers have seen how poorly tiered data was received in the wireless industry by consumers, and I think it'd take an act of Congress to divorce them of being able to use the word "unlimited" in marketing materials, no matter how fraudulent the claim might be.
- lsaferite 8y ago
  I would fully support usage based pricing as well if the rates were reasonable. By reasonable I mean at the very least an order of magnitude lower than they charge right now. I'd be on board with billing more akin to electricity. Even better, regulate them like a utility.
  - ocdtrekkie 8y ago
    Indeed. It would also be key that, like electricity, gas, and water, the rates are relatively flat and very granular. You shouldn't fall over 2 GB of usage and end up paying for 3 GB, it should be by the MB, so you don't get rounded up to a much higher bill, for instance.

gleenn 8y ago

You're assuming they are trying to make the service the best they can. They've obviously done the math and it's cheaper to charge people a flat fee. They don't really care how good their service is, or how fair it could be, just that they maximize profit.

jbob2000 8y ago

> Why don’t cable companies charge by megabyte used, instead of by speed? Because they can and do charge you for both and laugh all the way to the bank.

rhino369 8y ago

Customers would hate having to consider how much data they are using.

ocdtrekkie 8y ago
The rate would likely be relatively proportional: On average, with usage based pricing, people would pay about the same. But heavy Internet users would pay more and lighter users would pay less.

zmarty 8y ago

Bandwidth is not a finite physical resource. The marginal cost to add more capacity is tiny. Their cost to serve is tiny. I HATE data caps.

janaagaard 8y ago
If you payed by the megabyte there wouldn’t be any reason to put a cap on consumption. Just sayin’. ... But that being said, I certainly can relate to what you mean. Charging by the megabyte would require a very, very low price per megabyte for this to be acceptable.

lunchables 8y ago

Why charge for one when they can charge for both? (They already do, read your terms of service carefuly)

CobrastanJorji 8y ago

> Why don’t cable companies charge by megabyte used, instead of by speed? Because "speed" sells, and the customers Comcast wants don't use much bandwidth. The #1 source of revenue for Comcast is the customer who has cable, has high speed Internet, doesn't really use the Internet for much, and just pays their cable bill every month without really thinking about it. The family with 3 teenagers all watching Fortnite live streams or whatever the kids are doing these days is Comcast's second worst customer, only superseded by the guy streaming those videos.They're taking up a significant chunk of their area's local bandwidth, and that costs real money to upgrade. Comcast has no incentive to allow for this use case unless they can find a price tier that makes you a good customer again (notice that for $50/month, Comcast will remove the bandwidth caps). It's effectively the same reason that Comcast doesn't let you sign up for individual cable channels.

lsaferite 8y ago
I have 1Gb + unlimited data right now. I regularly use 1.2-1.5TB of data every month. I'm sure they hate me almost as much as I hate them.

geodel 8y ago

Well you are missing the angry rant of tech savvy customers about charging per mega/giga bytes. They want flat rate and unlimited data.

forgottenpass 8y ago

Before overselling internet access was commonplace, you bought based on guaranteed physical capacity (i.e. bandwith). Even with overselling, their network is still bound by that capacity. So they charge for both.

ocdtrekkie 8y ago

I've long been a proponent of usage-based pricing because it aligns the incentives of the business with the consumer: They want you to use more data, so they have the best interest to get you as fast of service in as many geographic areas as humanly possible. But wireline carriers have seen how poorly tiered data was received in the wireless industry by consumers, and I think it'd take an act of Congress to divorce them of being able to use the word "unlimited" in marketing materials, no matter how fraudulent the claim might be.

lsaferite 8y ago
I would fully support usage based pricing as well if the rates were reasonable. By reasonable I mean at the very least an order of magnitude lower than they charge right now. I'd be on board with billing more akin to electricity. Even better, regulate them like a utility.
- ocdtrekkie 8y ago
  Indeed. It would also be key that, like electricity, gas, and water, the rates are relatively flat and very granular. You shouldn't fall over 2 GB of usage and end up paying for 3 GB, it should be by the MB, so you don't get rounded up to a much higher bill, for instance.