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Time Warner To Test New Broadband Rate Plan: Pay For What You Use

(January 17, 2008)--Time Warner Cable will experiment with a new pricing structure for high-speed Internet access later this year, charging customers based on how much data they download, a company spokesman said Wednesday.

The company, the second-largest cable provider in the United States, will start a trial in Beaumont, Texas, in which it will sell new Internet customers tiered levels of service based on how much data they download per month, rather than the usual fixed-price packages with unlimited downloads.

Company spokesman Alex Dudley said the trial was aimed at improving the network performance by making it more costly for heavy users of large downloads. Dudley said that a small group of super-heavy users of downloads, around 5 percent of the customer base, can account for up to 50 percent of network capacity.

Dudley said he did not know what the pricing tiers would be nor the download limits. He said the heavy users were likely using the network to download large amounts of video, most likely in high definition.

It was not clear when exactly the trial would begin, but Dudley said it would likely be around the second quarter. The tiered pricing would only affect new customers in Beaumont, not existing ones.

Time Warner Cable is a subsidiary of Time Warner Inc., the world's largest media company.


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