Comcast Gives Customers Something to Smile About

Comcast (NASDAQ:CMCSA) announced Thursday that it will raise its broadband cap to 300 GB per month as it tests two new ways to deal with managing network traffic, the cable provider said in a blog post today. Until now, the cap had been set at 250 GB.

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While the move is welcomed by those who have hit the existing limit, it does not address concerns that have arisen over the last few weeks about Comcast exempting some of its own video on-demand traffic from the restrictions and allegations that it is prioritizing that traffic in violation of federal rules implemented when it bought NBC Universal.

Comcast plans to roll out two types of plans in unnamed markets. The first will offer customers a higher cap at higher tiers of service. Internet Essentials, Economy, and Performance Tier customers will have a 300 GB cap, but those already getting higher speeds will have some undetermined, higher cap. Customers under this plan will also be able to buy additional gigabytes. Comcast gave the example of $10 for a 50 GB block.

The second offering will give customers a 300 GB cap across all product lines while offering them the chance to buy more gigabytes for the same price as with the first plan. The ability to buy more gigabytes is the key to both plans. Previously, customers were simply cut off when they hit their max.

The two plans resemble those offered by AT&T (NYSE:T), which stops users at 250 GB or 150 GB per month, depending on the plan, and then charges them $10 for 50 more gigabytes.

While Comcast’s changes are no doubt an improvement that will be well-received by customers, it’s still avoiding the next step, which is offering unlimited broadband, which most Internet providers consider to be a Pandora’s Box scenario. Comcast has expressed concern that unlimited packages would be detrimental to the quality of its network if a lot of customers took advantage.

However, in an FCC filing, Comcast said that when its network becomes congested, it will temporarily slow traffic to customers requiring the most bandwidth, which makes the caps seem unnecessary. That’s why many argue that the caps have less to do with network management and more to do with protecting Comcast’s pay TV business by discouraging customers from spending a lot of time watching TV online with services like Netflix (NASDAQ:NFLX) and Hulu (NYSE:DIS).

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