With more cable subscribers relying on online video from Netflix and other online video providers, cable MSOs will begin adopting usage-based billing for broadband subscribers, Sandford C. Bernstein & Co. analyst Craig Moffett predicts.
Moffett told Bloomberg that he expects Cox Communications, Charter Communications (Nasdaq: CHTR) or Time Warner Cable (NYSE: TWC) to be the first MSO to implement usage-based billing. "As more video shifts to the Web, the cable operators will inevitably align their pricing models," Moffett said. "With the right usage-based pricing plan, they can embrace the transition instead of resisting it."
Cox could be setting the stage for usage-based billing by deploying usage meters that tell its cable modem subscribers how much bandwidth they are consuming, and warning subscribers that exceed usage allowances. Suddenlink Communications recently began charging subscribers fees for exceeding its bandwidth caps.
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