Comcast Pay-Per-Use Broadband Plan Backed by FCC

Federal Communications Commission (FCC) chairman Julius Genachowski says he's happy Comcast may begin offering Internet service on a pay-per-use basis. It would be a change from the more common model of charging a flat rate.

Comcast recently announced it is dropping its 250 GB monthly download limit. Instead, it will now allow users to go above its new 300 GB "soft" limit, but only upon paying an additional fee.

The company is also looking at offering several different service packages, with monthly data allowances that depend on the price paid, much like today's mobile broadband deals.

Speaking at the annual convention of the National Cable & Telecommunications Association, Genachowski said Comcast's new pricing model "could be a healthy and beneficial part of the ecosystem." (Source: latimes.com)

However, Genachowski didn't discuss the idea of whether or not government should pressure Internet providers to adopt such pricing options. Instead, he merely cited it as an example of companies keeping in mind the best interests of their consumers.

Comcast Changes: No Cost Cutting Yet

Genachowski may be getting ahead of himself if he believes the Comcast move will spark similar actions by other technology companies.

For example, he spoke of cable companies potentially lowering prices for customers who agree to stick to lower monthly download limits. However, Comcast's test program involves offering only more expensive packages for heavy data users.

In most cases, companies lower their rates only when they face substantial competition in a particular market. In many parts of the U.S., of course, there just aren't enough Internet providers to make for the kind of competition that benefits consumers or drives down prices.

Comcast vs. Netflix Debate Not Addressed

Genachowski also didn't address the controversy surrounding Comcast's video-on-demand services. In some situations, watching video doesn't count towards the user's overall data limit, while watching video from rival companies such as Netflix does.

This discrepancy in billing behavior has led to complaints that Comcast is unfairly charging its customers more to watch its rival's services.

Right now these issues affect only a small number of users. The average Comcast customer consumes only 10 GB of data each month and thus has no reason to be concerned with monthly limits.

That could change in the long term, however, as watching television and movies online becomes more popular. (Source: bna.com)