How Will Usage-Based Broadband Affect Your Budget?

How Will Usage-Based Broadband Affect Your Budget?

November 9

Broadband service providers like Time Warner Cable and Comcast are testing new pay-as-you-go or metered plans instead of the traditional unlimited usage plans. According to the NY Times, users can sign up for a plan which allows 5 gigabytes (equivalent to downloading two HD movies) of broadband and are given a $5 discount each month if they don’t go over. If they do, they pay for $1 for each additional gigabyte. These pricing plans are likely to affect businesses in the future as well. The problem is that most of us probably have no idea exactly how much broadband we use in a day, let alone a month, so what does a metered plan mean for your business?

Robert Frieden, professor of telecommunications and law at Penn State University explained in a article that this pricing strategy is aimed at increasing revenue and profit for the broadband provider. We wonder how an SMB client is supposed to pay for this increase.

But don’t start screaming at your provider yet. The first thing a broadband user needs to find out is how much broadband they’re currently using. You can do this by installing various free tools that help your determine your monthly traffic. In some cases, metered broadband plans might actual save money. Customers paying for unlimited access may not be using very much after all so switching to a smaller, metered package might not be a bad idea—assuming you don’t go exceed your limit.

Once you find out how much broadband you’re using, you then need to find out exactly what is taking up the most bandwidth. Are employees wasting time watching videos? Are they downloading songs or videos for personal use on company broadband?

Some IT professionals are using open source tools to track the utilization of the broadband. Once these tools are implemented, the IT professionals sometimes find that a client’s employees are using the broadband for illegal site activity—one even noted that 40 percent of his client’s broadband usage was linked to pornography sites, although just as much usage could go to streaming videos on Youtube, Netflix, or other bandwidth bandits.

It’s important for IT professionals to make sure their clients have the access they require while also allowing them to determine for themselves which sites to block, or how to allocate company bandwidth among employees so they can avoid ridiculous overage fees.

Of course, many of these issues can be addressed in a company’s internet usage policy. Check with your provider to determine if they have any plans to move toward pay-as-you-go plans so you can start to determine what new pricing might mean for your budget in 2013.