It’s Not Too Late for Usage-Based Pricing

BUT WINDOW IS CLOSING, NCTA’S POWELL WARNS MSOs
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ATLANTA — The window for U.S. cable operators to introduce usage-based broadband policies remains open, but it won’t stay that way forever, National Cable & Telecommunications Association president and CEO Michael Powell said last week during an interview with Kevin Hart, executive vice president and chief technology officer of Cox Communications.

Cable operators, Powell said, “should be moving with some urgency and purpose” with respect to usage-based billing, adding that operators have sound economic reasons to pursue a new model. But he acknowledged that the industry faces perceptions that usage-based billing is viewed as an anti competitive move designed to disadvantage over-the- top video providers.

“I don’t think it’s too late,” Powell said, noting later that the wireless industry has been acclimating consumers to the concept of usage-based Internet access. “But it’s not something you can wait for forever.”

Powell also addressed cable’s new, more diverse competitive landscape. “We play four-dimensional chess,” he said. “Competition used to be a very linear thing.”

The addition of over-the-top video has made the competitive environment more complex and difficult for regulators to grasp, he added, noting that some new entrants are being viewed as both friend and foe to cable.

Netflix, Powell said, is sometimes seen as both “the best thing or the worst thing that has happened to us.”

But he said the surge of competition from over-the-top services from Amazon, Google and Netflix, and the potential of new virtual MSO services, has been a positive, spurring operators into spending and developing new technologies and services more rapidly than they might have in the absence of those threats.

The confluence of new competition “woke us up,” he said. “We’re on our toes.”

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