November 4, 2008

AT&T Sets Limits On Monthly Internet Use

The nation's largest Internet service provider will initially apply the limits in Reno, Nev., before extending the practice in other areas as well.

ISP's are increasingly setting such data caps in an attempt to curb the small number of "bandwidth hogs" who consume a significant amount of network capacity. Indeed, AT&T spokesman Michael Coe said just 5 percent of AT&T's subscribers consume 50 percent of the network capacity.

The restrictions the ISPs are enacting are tentative, and ISPs often differ on the specific limits to set and whether to charge users for exceeding the caps.

Beginning this month, AT&T will limit monthly downloads to 20 gigabytes for users of their slowest 768kbps DSL service.  Limits will then increase according to the speed of the plan, up to 150 gigabytes per month for the 10 Mbps service.

At these limits, subscribers would have to continuously download at maximum speeds for more than 42 hours, depending on the service, to exceed their caps.   In practice, use of e-mail and the Web would not take a subscriber anywhere close to the limit. However, users of streaming video services such as Netflix might exceed the upper bandwidth restriction.  For example, subscribers with downloads of 3 Mbps have a monthly limit of 60 gigabytes, which would accommodate the download of about 30 DVD-quality films.

The caps will initially be applied to new customers in the Reno, NV area, AT&T said. Current subscribers will be enrolled if they exceed 150 gigabytes in a month, regardless of their service level.

"This is a preliminary step to find the right model to address this trend," said Coe, adding that the company may add another test market before the end of the year.

AT&T will allow subscribers to monitor their usage on a Web site, and will contact customers who reach 80 percent of their limit. Following a grace period to allow subscribers time to acclimate to the new system, those who exceed their limit will be charged $1 per gigabyte, Coe said.

Last month Comcast Corp., AT&T's chief rival in Reno, officially launched a nationwide traffic limit of 250 gigabytes per subscriber. Although the nation's second-largest ISP doesn't charge customers extra for exceeding their limit, it will cancel service after a series of warnings. Comcast's bandwidth limits were previously undisclosed. 

Time Warner Cable Inc. and FairPoint Communications Inc. are also planning or testing traffic limits as low as 5 gigabytes per month, a cap easily exceeded by those who watch DVD-quality videos online. Verizon Communications Inc. remains the only holdout among the large ISPs. The company says it has no plans to set data limits for its customers.


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