By David Meyer, 17 March 2008 08:28
NEWS
Time is running out for so-called "unlimited broadband" packages, according to analysts and ISPs.
For some time, many ISPs have been offering users what they call unlimited broadband, although it almost always comes with some kind of "fair usage" cap on downloads. PlusNet has been one of the few providers to buck this trend - preferring instead to offer packages based on fixed download caps - and is now warning that the emergence of IP television and the BBC's iPlayer will make it impossible for its rivals to continue marketing their packages as "unlimited".
The list from A to Z
Click on the links below to find out more...
A is for ADSL
B is for BT
C is for Cable & Wireless
D is for Dial-up
E is for Education
F is for Fibre
G is for Goonhilly
H is for HSDPA
I is for In-flight
J is for Janet
K is for Kingston
L is for Landlines
M is for Murdoch
N is for Next generation
O is for Ofcom
P is for Power lines
Q is for Quad-play
R is for Remote working
S is for Satellite phones
T is for Trains
U is for Unbundling
V is for VoIP
W is for WiMax
X is for Xbox
Y is for YouTube
Z is for Zombies
Neil Armstrong, PlusNet's product and marketing director, said: "2008 will be the year of IPTV." Speaking to silicon.com sister site ZDNet.co.uk, Armstrong said the iPlayer service had "gone from zero per cent of [UK traffic] to five per cent in two months", and this explosion in high-bandwidth usage meant ISPs would have to either explicitly charge for the actual amount of data used by customers or operate at a loss.
YouTube is also believed to provide around 10 per cent of all traffic on the internet - and if it goes "high-quality", as it is expected to do soon, this figure is likely to go up.
Armstrong said: "Where it's going to be a big problem is ISPs selling unlimited broadband with a 'fair-use' policy. [Users on such packages will] hit that figure and [their] line will slow down, and [they] are going to get a nasty surprise. This is happening right now."
Asked whether this meant those who consider themselves to be "light users" of the internet but now use services such as iPlayer will have to pay more, Armstrong agreed. He said: "Somebody somewhere is going to have to pay, which is why we are very clear about what our products [involve]. It's not just a single-price, all-you-can-eat market any more."
Armstrong added that, while business customers "don't fall for advertising as easily" as consumers might, the increasing prevalence of home-working using home broadband connections meant a change in tariffing could affect some businesses.
He also said increasing consolidation in the broadband market, together with the massive increase in data traffic brought about by consumer video services, would force many small ISPs to go business-only or be swallowed up by larger rivals.
Michael Philpott, principal analyst at Ovum, agreed with PlusNet's views on "unlimited broadband". He said: "[Such offers are likely to disappear] quite soon actually - I would say within 12 months, simply because you hear it more and more. At conferences where the likes of Tiscali and BT are present, you hear them say these things - 'We must move to a new tariffing scheme' - and that tells me they're working hard on this."
Comments
There are 3 comments. Join the discussion
1. Austin Holdsworth
Bandwidth isn't some limited resource that will dry up if we use too much of it. I'm willing to bet this is just hype and political mis-direction by the larger players that can still offer "unlimited"in what is becoming an increasingly competitive market.
Many customers like myself have no real care for how many megabytes of data they use. Some weeks I may just use email, other times I may download the latest Linux CD Image.
I want an "unlimited" package and I will happily pay a fair price to switch to a provider that is willing to satisfy that need. I don't want to spend my time online "clock watching". Thank goodness those dial-up days are history.
2. Guy Reynolds
Basically ISP have been hoist by their on patard.
For years they have been over selling their products: 8M download speeds and unlimitited bandwidth, and under investing in infrastructure. They have got away with it because their customers have never had the services available to them that required this level of performance. Now that such services exist they are starting to feel the pinch and cry foul.
Unfortunately our contract laws in the UK seem to be weighted in favour of suppliers rather than customers, thus if what is predicted comes to pass many subcribers will find their ISP chaning contract terms in mid contract leaving them with something less than they orginally purchased.
3. Matt H
We pay more than any other country and yet we get the least bandwidth... and now they want to charge us more?! What planet are these people on?!
I've no idea what download usage I use... I play on PSN/Xbox Live and Nintendo Wi-Fi pretty much every day. My Wife surfs the net most days and when I can be bothered I'll spend an hour or more just surfing..... at this rate I'll be able to use my broadband for 20 mins a month! Oh.. and have the priveledge of paying more! God this country just gets better!