Comcast Starts Billing Bandwidth Hogs, But Exempts Its Own VOD Apps

MSO Initiates Usage-Based Billing Trial in Nashville

Comcast last week took the first steps to start charging Internet customers if they consume copious amounts of bandwidth -- but the MSO is being accused of stacking the broadband deck in its favor.

With the usage-based pricing trial, which kicked off in Nashville, Tenn., the nation's largest MSO will continue giving Xfinity video-on-demand apps for Xbox 360 a free ride. Critics call the policy unfair and a violation of network-neutrality principles, but Comcast says it is simply using another technical mechanism for delivering video over its own network.

On Aug. 1, Comcast introduced a new Internet data usage plan in the Nashville area that boosts the data usage allowance for all Xfinity Internet customers from 250 Gigabytes per month to 300 GB. When customers exceed that limit, they are notified via email and an in-browser notice that they will be charged an extra $10 for each additional 50-GB increment they use up.

The new policy, which eventually will replace the static cap across Comcast's footprint, is designed keep a lid on excessive network usage "to ensure that all of our customers enjoy the best possible Internet experience over our high-speed data service," Cathy Avgiris, Comcast's executive vice president and general manager of Communications and Data Services, said in announcing the plans for the trial in May.

But by exempting usage of Comcast VOD on Xbox consoles, as well as to TiVo DVRs, Comcast is thwarting competition from potential online video competitors, Public Knowledge said earlier this week in an official complaint to the Federal Communications Commission. The public-advocacy group asked the agency to put a stop to Comcast's practice.

"Comcast is doing exactly what opponents of its merger with NBCUniversal feared: using its Internet business to protect its pay-TV business," Public Knowledge executive vice president Michael Weinberg said in a statement. "Exempting its own online video services from the data caps that apply to every other online activity creates an unfair advantage."

Comcast has countered that it is using non-public IP networks to serve up the cable VOD, which is distinct from a broadband Internet service.

"We have consistently treated all video carried over the public Internet the same whether it comes from our sites or anywhere else on the public Internet," Comcast reiterated in a statement last week. "That's consistent with FCC rules and consistent with what we have always done and continue to do."

Other Internet service providers that have established usage-based pricing include AT&T and Suddenlink Communications. As with Comcast's approach to delivering VOD to IP devices, AT&T excludes usage of its U-verse TV IPTV service from the 250-GB monthly limit.

--John Eggerton contributed to this article.