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Broadband Buffet Is Over

ISPs look to implement caps and metered pricing for broadband services

The glory days of an unlimited broadband appear to be nearing an end as ISPs look to implement caps and metered pricing for broadband services. In the not-so-distant-future, broadband users will be forced to pay on a metered basis in the same way as other utilities such as electricity and water, with customers only paying for what they use.

Unlimited flat-rate packages are a reflection of internet companies’ desire back in the mid-1990s to get potential customers to sign-up and explore the internet revolution. Now, with just under two billion people using the internet globally, companies are keen to reinvent and monitor how costumers utilize their bandwidth.

“We’re going to have to consider pricing structures that allow us to sell packages of bytes, and at the end of the day the concept of a flat-rate infinitely expandable service is unachievable,” Dick Lynch, Verizon’s Chief Technology Officer has said in the past. Frontier Communications made headlines last year when it claimed it would start implementing service caps as low as five giga-bytes per month.

It could be a case of one-ruining-it-for all; Cisco Systems found that one percent of global users are consuming 20 percent of global bandwidth, consistent with other findings that a small minority of users are consuming a disproportionate share of network resources.

With an impending move to a metered broadband, top executives from the Telecoms industry will meet at the NGTelecoms Summit in December, to discuss the risks of implementing metered usage, the best practices to mitigate the risks, comparisons between US & Canadian attitudes and lessons a potential move from the mobile world would mean.

Those in attendance will include John Harrison, Vice President of Engineering and Operations, Sprint; Jim Zerbe, Director Product Development, T-Mobile; Tony Scicchitano, Executive Director IT Open Systems, Verizon; Joseph Houle, Lead Technical Architect, AT&T; Lance Condray, VP Strategic Services, Bandwidth.com; Victor Perez, VP Engineering and Operations, Comcast and Michael Coleman, SVP/CIO, Comporium Communications.

More recently, AT&T have stirred things up with an announcement that it was heading away from the all-you-can-eat buffet style of broadband and was keen to adopt consumption billing for wireless broadband. Verizon co-signed a manifesto with Google that outlined a set of network neutrality principles. Though the Verizon proposal was neither solely, nor explicitly about consumption billing, consumption billing was certainly implicit.

Service providers are definitely moving away from one size-fits-all, said Susie Kim Riley, the chief marketing officer for Tekelec (which earlier this year bought Camiant, which Riley co-founded). "There's no disputing we're moving away from that," Riley said. "You see that with AT&T, you see that in Europe, and even when you read between the lines with Google and Verizon."

More Stories By John Funnell

John Funnell has worked in online media for over ten years, after achieving his First Class BSC Hons Degree (BBC Sponsored), John won Bos 18-21 Princess Trust Entrepeneur of the year at 21, setting up Clean Living Records Ltd (including www.BeatReview.com) with great success having many acts that charted in Europe and Canada. After selling the business John looked for a new challenge and joined GDS International, having a successful career in sales and Delegate acquisition, he worked up to Event Director EMEA, forging contacts with some of the biggest technology names in the world, this lead to John having a lead role in the creation of MeettheBoss.com and MeettheBoss.tv – the worlds largest business IPTV channel. John then took over as Marketing and Communications Director and ran a multifaceted global Marketing team for GDS International in New York, Sydney, Kuala Lumper and the UK.. John joined Global in 2011 with the challenge of supporting its growth by developing a solid Marketing foundation through various Digital, PR and brand initiatives.

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