By Lillian Rizzo
The coronavirus pandemic led millions of Americans to turn their
homes into offices and classrooms. It also forced many to change
their habits to keep their internet bills in check.
Shea Dunn, a data-process analyst for Target Corp. who has been
working from his Minneapolis home since March, said he never had to
think about his household's internet consumption. That changed in
early July, when he got a notice from his broadband provider,
Comcast Corp., informing him he was using too much data and was
liable for a $50 fee if he kept exceeding his cap.
Mr. Dunn said he has been watching his internet usage very
closely ever since to avoid being hit with an overage fee,
especially at the end of each month. "Even without downloading Xbox
games anymore, I still receive messages that I'm close to hitting
the cap," Mr. Dunn said.
The amount of time consumers spend streaming TV, gaming and
using Zoom or other videoconference platforms substantially
increased since the start of the pandemic, activities that often
eat up large amounts of data.
The practice of limiting the internet usage of customers and
charging heavy users more is common among many of the nation's
internet providers. Doing so partly helps offset the revenue lost
from subscribers abandoning their traditional pay-TV plans in favor
of internet-based options -- a phenomenon known as cord-cutting.
Users who consistently need more data are encouraged to upgrade to
a pricier plan.
Data caps also help keep the prices of internet packages stable
by shifting the extra cost to heavy users, according to Mark
Trudeau, chief executive of broadband-data firm OpenVault, which
tracks more than a million U.S. subscribers. "It protects the
majority of subscribers from having rates raised every year," he
said.
As the pandemic forced Americans to shelter at home in March,
several providers like Comcast and AT&T Inc. temporarily
suspended overage fees for some customers. Many, including Comcast
and Cox Communications Inc., later reinstituted data limits.
AT&T's millions of DSL subscribers -- the technology that sends
internet signals over copper telephone wires -- also now face
monthly limits, while AT&T fiber customers' data caps are
waived through the end of the year.
Charter Communications Inc. is currently prohibited from capping
the internet usage of its customers as part of a deal with the
Federal Communications Commission when it acquired Time Warner
Cable. Charter this summer asked the FCC for these restrictions to
be lifted early, which would give it the ability to institute data
limits starting in May 2021.
A Charter spokeswoman said the company would weigh its options
when the FCC conditions expire, "but is currently not considering
implementing data caps and has no plan to do so."
Gareth Cales in Jacksonville, Fla., recently switched from
Comcast to AT&T, since AT&T doesn't have a data cap in his
area and a promotion makes it the less-expensive option. AT&T's
most-expensive 1-gigabit-speed plans offer unlimited data.
Before the pandemic, Mr. Cales, a 34-year-old who works in
software development and traveled often for work, never before
thought about his at-home internet usage. Rather than increasing
his Comcast bill by $30 for unlimited use, he chose AT&T.
"I don't think I'm the most prolific internet user," Mr. Cales
said.
On top of helping internet providers generate more revenue, data
limits are a way to alleviate congestion and strain on the network.
The internet's backbone held up pretty well during the early days
of the pandemic, despite significant pressure.
"We've lived through this scenario and did well without caps on
bandwidth usage, which makes you question why they are needed at
all," said David Choffnes, an associate professor at the Khoury
College of Computer Sciences at Northeastern University.
Providers have attributed strong internet performance to
round-the-clock work being done on the network, which was possible
because of billions of dollars of further investment. The size of
the cost is another reason why providers say heavy users are often
asked to pay more.
In September, U.S. households used an average of 383.8 gigabytes
of data, according to OpenVault. So far this month, consumption has
increased to 413.3 gigabytes. This is up from 361 gigabytes in
January, which had been the latest monthly record of usage prior to
the pandemic.
Comcast said even with pandemic usage, 95% of its customers
don't reach its limit, which it recently upped to 1.2 terabytes
from 1 terabyte. For some Comcast subscribers, the price of
unlimited packages has also been lowered, a spokeswoman said.
Similarly, Cox raised its data allowance by 25% to 1.25
terabytes a month, and it waives the overage fee the first time a
customer exceeds their data allowance, according to a
spokesman.
Verizon Communications Inc. consumer unit chief Ronan Dunne said
the average subscriber of its Fios service uses more than 500
gigabytes a month without taxing the fiber-optic system's
infrastructure, so the company doesn't charge fees to reduce
consumption.
Longtime Cox customer Daniel Waltz in Oklahoma, an inactive
commercial pilot who recently started business school, said during
the pandemic he upgraded to an unlimited plan after reaching the
limit a few times.
As he spent more time at home, his internet usage shot up,
mostly due to virtual classes and gaming.
Mr. Waltz's bill increased by about $50 a month to roughly $161
as a result of the upgrade, but he said he no longer has to worry
about facing an overage fee. He also said he feels his internet
quality improved.
When Comcast's data cap was reinstated in July, Shane Bailey, a
web developer in Jacksonville, Fla., said he and his family came
close or exceeded the limit a few times before he chose to upgrade
to an unlimited plan for an additional $30 a month.
Both he and his wife are working from home, while his children
are learning from home and often streaming TV shows or playing
educational games.
Mr. Bailey said the $30 upgrade gave him the peace of mind of no
longer having to worry about overage fees. "Right now it's cheaper
than the gas I would normally be using to drive to work," he
said.
--Drew FitzGerald contributed to this article.
Write to Lillian Rizzo at Lillian.Rizzo@wsj.com
(END) Dow Jones Newswires
October 25, 2020 11:14 ET (15:14 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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