Watching streaming videos may lead to a higher internet bill

Sections: Business News, Online Music/Video, Video, Video Providers, Web

submit to reddit
Netflix and Hulu

Web-based video services such as Netflix, Hulu, Amazon and others have one important thing in common – they aren’t associated with cable companies. Many people (myself included) have decided to cancel cable service in favor of internet video consumption and over-the-air broadcasts. As subscribers for cable services decrease, cable companies are trying to figure out a way to make up for all that lost revenue. One solution may be to charge customers based on how much internet bandwidth they use in a billing cycle.

According to an analyst from Sanford C. Bernstein & Co. (via Bloomberg), it’s likely that either Time Warner, Charter Communications or Cox Communications will institute pay-per-use billing in 2012.

Many customers currently pay a fixed rate every month for their internet service. Some providers such as Comcast set bandwidth caps that are so high, most people will never notice they’re limited to begin with. Under this new pricing scheme, those who watch a lot of Netflix will be subject to higher charges than those who primarily use the web for lighter activities such as browsing web pages.

Cable companies have not been embracing the growing internet video revolution. In many cases, you have to subscribe to a cable or satellite provider to officially watch some shows online.

Customers will certainly disagree with what is essentially a data plan from their home internet provider.

Via [Bloomberg]

Print Friendly