Cable Companies: How to shoot yourself in the foot

As you may have heard, Time Warner is experimenting with a new pricing scheme in which they limit the amount of data users are allowed to transfer each month over their cable internet service.

They claim that this is to manage costs.  But as Dave Burstein (of DSL Prime) said, that’s not really it at all.  That’s the same reason that Comcast gives for their throttling nonsense, which clearly hasn’t gone over well with heavy ‘net users.

But if that were the real reason, why would Verizon be so anxious to give me 20mbps in both directions and not throttle or limit a single thing?  Well let’s see… what other possible reason could Cable companies have to stop you from downloading large files like, oh I don’t know… TV shows and movies?

Fact is… cable companies have an opportunity here that they are wasting because they want to cling to a Cable TV and PayPerView-based business model that is quickly being eroded by iTunes, Xbox, Amazon, Netflix, etc.

But instead of capitalizing on this change, by offering users more of what they need in order to leverage it (ie. faster speeds) for a reasonable price increase, they’d rather discourage you from using these new IP-based offerings.

I guess they saw how well fighting the digital trend worked for those other media companies and decided that they can alienate their customers and lock them into outdated business models with the best of them.

Fortunately, some of us have viable alternatives.  And with moves like this, companies like Verizon with FIOS will have even more people lined up to pay them for service.