FCC Chief Backs Usage-Based Broadband Pricing

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WASHINGTON—The top U.S. telecommunications regulator on Wednesday endorsed the idea that broadband providers could charge extra for providing heavy Internet users with lots of online video or data-heavy services such as videogames.
Julius Genachowski, chairman of the Federal Communications Commission, backed "usage-based pricing" while outlining proposed rules that would bar Internet providers from deliberately tampering or slowing legal Web traffic.

Mr. Genachowski's support for pay-as-you-go pricing represents a victory for cable and telecommunications companies because it clarified whether broadband providers had the power to charge by what users consumed.
"We were appreciative of them clarifying it," said AT&T Inc. Senior Vice President Robert W. Quinn Jr.
But communications providers may still get pushback from consumers, Silicon Valley and lawmakers on pay-as-you-pricing depending on how network operators implement such plans.
Last April, Time Warner Cable Inc. shelved its tests of usage-based pricing after a consumer outcry and pressure from some lawmakers.
Some consumers complained the caps on data usage were too low and the pricing tiers were too expensive. In one trial, Time Warner Cable offered plans with five gigabytes of monthly data for $30 and 40 gigabytes for $55. Exceeding those caps cost $1 for each gigabyte.
Watching one streamed high-definition movie would consume about four gigabytes of data.
The advent of usage-based pricing could harm the development of the Internet, say critics. The rapid adoption of fast Internet service was fueled in part by the availability of all-you-can-eat service plans. Consumers didn't have to worry about exceeding bandwidth limits.
Reaction to the proposal was mixed. Several venture capitalists, including John Doerr, voiced support. A coalition of Internet companies, including Facebook Inc. and Google Inc., and public interest groups said they will work to limit broadband providers' ability to extract extra payments for faster delivery.
The proposal also exposed divisions within the FCC. Democratic Commissioner Michael Copps said he would continue to press for tougher so-called net neutrality rules than the chairman outlined. "It's no secret that I am looking for the strongest protections we can get to preserve an open Internet built on the most secure legal foundation, so we don't find ourselves in court every other month," Mr. Copps said.

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