Commentary

GAO Says Consumers Lack Information About Pay-Per-Byte Pricing

Seven out of 13 major home broadband providers now offer pay-per-byte pricing, but many subscribers lack useful information about those plans. That's according to a new report about data caps, released today by the U.S. Government Accountability Office.

One of the biggest problems for subscribers is that they don't know how much data particular applications require. Researchers specifically found that some people mistakenly thought that online shopping could push them over their monthly caps, even although e-commerce doesn't typically require a great deal of data.

One reason for the confusion appears to be that broadband providers themselves offer inconsistent information about data consumption. “Estimates provided by providers can differ from one customer support document to another,” the report states. “We found one provider that estimated 4 GB of data usage for a 1-hour movie in one document available to consumers, but in another document estimated only 1.5 GB.”

The GAO adds that data meters, which are supposed to measure consumption, aren't necessarily correct. “An official with a company that conducts internal audits of fixed-Internet-provider data meters and their integration into databases used for billing systems told us that while some of their audits have shown that meters are accurate, others have shown the need for improvements.”

Currently, the providers offering usage-based pricing are experimenting with different models. For instance, Comcast -- the largest broadband provider -- currently caps some subscribers at 300 GB a month, with overages of $10 for 50 GB.

Several other providers offer caps ranging from 150 GB to 4,000 GB, with the total varying based on connection speed and monthly fees, according to the GAO.

Caps of 150 GB might have seemed generous a few years ago. But these days, that's not enough for many cord-cutters. In fact, the GAO report says that people who use the Internet to replace subscription television currently consume 212 GB a month on average.

The report recommends that the Federal Communications Commission work with providers to develop a code of conduct aimed at helping consumers understand data use and pricing. The GAO also urges the FCC to track pay-per-byte pricing and its impact on consumers.

Advocacy group Public Knowledge, which previously called for the FCC to investigate usage-based pricing, says that today's report “is further evidence that today's data caps work against the best interests of consumers and the growth of the Internet.”

Next story loading loading..