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Exclusive: Charter Implementing New Caps
100GB for 15Mbps or less, 250 for 15Mbps or more; not strictly enforced at first
by Karl Bode 05:56PM Tuesday Feb 03 2009
Broadband Reports has learned that Charter will be updating their acceptable use policy (AUP) next week, setting the stage for clear usage caps and potential overage fees. A source familiar with the plans tells us Charter will be imposing a 100GB cap upon any Charter connection of 15Mbps or less, and a 250GB usage cap for broadband tiers "over 15 Mbps up to 25 Mbps." Documents shared with Broadband Reports make no mention of Charter's new 60Mbps DOCSIS 3.0 tier, which was launched last week in one market.

According to the insider, the policy will not be strictly enforced initially, but "it's only a matter of time." Like many carriers, Charter's AUP language has always given Charter the right to "adjust, suspend, or terminate" the subscriber's connection without warning. However, an as-yet published FAQ seen by Broadband Reports indicates Charter will now be more seriously enforcing these limitations. The new AUP will be a digital warning shot over the bow of the carrier's heaviest users.

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There will not initially be overage fees, but the new AUP reserves the right to charge "additional fees in accordance with Charter's then-current applicable rates." If there's a company who could benefit from overage fees it's Charter -- the carrier holds more than $20 billion in debt, and faces rumors of a looming bankruptcy protection filing.

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Charter CTO Marwan Fawaz told attendees of the CableNEXT conference in Santa Clara last year that "eventually, we will go to a usage-based solution." It's an idea being toyed with by several carriers; AT&T and Time Warner Cable are both currently conducting trials that charge users up to $1.00 per gigabyte. The idea appeals to investors who like the additional revenue, but it also allows carriers to monetize and/or control alternative video delivery.

The unreleased FAQ informs customers that these caps are necessary "to ensure that all users of the service are able to obtain optimal service levels." The FAQ promises users that only 1% of customers should be impacted -- with those customers contacted by either e-mail or phone. Our source says support agents don't yet have user bandwidth usage monitoring tools -- suggesting this should still be handled by the abuse department.

Cable carriers are concerned about being transparent in the way they handle congestion on their networks, given that in 2008, the FCC sanctioned Comcast for lying to consumers about their network management policies. With a new (and potentially more network neutrality focused) FCC boss in Julius Genochowski, cable carriers are making sure that whatever they're doing -- they're informing customers about it first.

"Our HSI AUP prohibits excessive bandwidth usage but does not expressly define excessive at this time," Charter spokesman Eric Ketzer told me when I asked for official comment. "I know many of our peers have established caps, and we are evaluating putting more definition around what "excessive" usage means."

update: Charter has officially confirmed the plans, and says their 60Mbps tier will not come with any limitations.

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