Kneecapping the Future: Comcast's Unjustified Internet Caps and the Plan to Kill Video Competition

Comcast recently announced major modifications to its so-called “excessive use” policies for Internet users. The company scrapped its 250 gigabyte (GB) per month usage cap, and said it will trial new 300 GB monthly allotments in two markets. The trials come with steep overage fees of $10 as soon you exceed this arbitrary cap. These changes follow the uproar over Comcast’s decision to exempt from the cap its own “Xfinity” streaming video on the Xbox while subjecting competitors’ streaming video services like YouTube and Netflix to the cap.

Comcast tried and failed to portray the 300 GB trial and hefty overage penalties as a pro-consumer removal of the caps in all but the test markets. But in truth they’re just the company’s latest move to protect itself from the disruptive threat posed by emerging online video competition. Comcast’s exemptions for its own traffic, followed by its clumsy suspension of caps for most users, illustrate one undeniable truth: There are no legitimate engineering or economic justifications for these caps. But Comcast’s new Internet overcharging scheme and its discriminatory treatment of competitors’ video offerings do pose a grave threat to future video competition.