What are broadband data caps, and should you be concerned about them?

Some service providers impose limits on how much you can stream

Published: June 24, 2015 03:50 PM

Are you among the growing number of people who are streaming more and more content each month? Then you should probably be aware that some Internet service providers (ISPs)—including AT&T, CenturyLink, Cox, and Comcast (in some markets)—impose “data caps” on their broadband service, which are monthly limits on the amount of data you can use over your Internet connection.

Data caps are already common in the mobile world. But with the shift to the new net neutrality rules, many are concerned that more ISPs will impose broadband data caps on fixed Internet connections, or even move to "usage-based" pricing plans that bill you for what you use rather than the speed you get. That would result in higher prices for consumers. Because there's often little choice in broadband providers, consumer groups warn, there's the potential for ISPs to abuse data caps as a way to boost broadband profits as their pay TV revenues decline. The new net neutrality rules don't ban broadband data caps outright, but do require ISPs to clearly disclose if they have them, and clearly explain what happens should a customer exceed them.

Broadband data caps will likely become more of a concern as you increase bandwidth-intensive activities, such as streaming TV shows and movies. Most of the data caps we’ve seen range from about 150GB to 300GB per month. If you exceed that, your provider might slow down your speed—“throttle,” in broadband parlance—or charge you extra. About $10 for each extra 50GB block you use seems common. You could wind up paying less by moving to a higher-speed service, which might have a higher cap. Some providers will cut off your service if you exceed the cap, though that’s becoming less common.

Cable companies claim that broadband data caps currently affect only the 2 to 5 percent of users who gobble up the most data, but a General Accounting Office report last year cautioned that more of us will approach those caps in the near future.

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Citing data from Sandvine, a broadband networking company, the GAO writes that the top 15 percent of streaming video users—cord cutters who stream video—use an average of 212GB a month. That’s more than seven times the average broadband user, who uses 29GB in a month.

It’s easy to see how this could affect you. Netflix says that streaming a high-def movie can eat up nearly 4GB or 5GB per hour. Do you have a new UHD TV? Streaming 4K movies, at 7GB or 8GB per hour, will gobble up even more of your monthly allotment. So as UHD TVs and programming become more common, binge-watching the entire 11 hours of the previous two seasons of "House of Cards" in one month could consume 88GB of your monthly allotment. You can only hope you don’t also become a fan of "Orange Is the New Black," or it's conceivable you could use up your monthly data allotment in one long, blurry-eyed weekend.

Consumer Reports and its policy and advocacy arm, Consumers Union, are opposed to broadband data caps, which we believe discourage the use of the Internet for a variety of worthwhile activities, including education and small business innovation, as well as entertainment. Last year, Charter decided to drop its seldom-enforced broadband data caps; we hope that other ISPs will follow suit.

—James K. Willcox

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