Now many of the biggest high-speed ISPs are considering capping the amount of bandwidth that their subscribers can use per month, a move that could undermine subscribers' free swapping ways--something that many lawsuits have not yet been able to achieve. If people know they have a limited amount of bandwidth available, the thinking goes, they'll be less likely to download voraciously or allow people to upload songs and music from their computers.
According to Michael Harris, president of Kinetic Strategies, a research company that follows the broadband marketplace closely, the ISPs can't help themselves. "Every major broadband provider is seriously weighing pros and cons of bandwidth consumption caps," he said.
The high-speed Internet industry as a whole is in the midst of its first major pricing shift. Many companies recently began offering low-priced, slower connections in hopes of attracting dial-up subscribers who are reluctant to sign up for more expensive services. They're also offering faster connection at higher prices and encouraging people who use large amounts of bandwidth to upgrade to this new level.
Capping the amount of data that a customer downloads and uploads, however, is a new wrinkle that could irk many people.
Leading the way in a closely watched initiative is Bell Canada's digital subscriber line service. Acting on an idea that has floated around the industry for years, the company has put caps on the amount of bandwidth its subscribers can use each month. If subscribers go over the caps, they start paying about 80 cents extra per 100 megabytes.
That's a controversial idea in the industry for a number of reasons. In order to implement it, ISPs have to set up a traffic-monitoring system that can tell exactly how many bits and bytes are flowing in and out of each subscriber's modem. It requires each subscriber to begin thinking about how much bandwidth is being used, a new kind of calculation for people used to all-you-can-eat connections to the Net.
Nibbling away at quotas
Critics of the idea worry that Internet annoyances such as Web pop-up ads or pornographic spam e-mail messages, all wholly out of the control of subscribers, would eat into their monthly bandwidth quotas. Subscribers on message boards noted that ad-supported software programs such as the Opera Web browser could take another bite at the cap without subscribers' approval. Some have even raised the specter of malicious attacks, in which streams of traffic could be sent to a computer by an outsider, pushing that account over a monthly limit without any action on the part of the subscriber.
Despite such worries, Bell Canada says the policy has been a success so far.
Andrew Cole, a Bell Canada spokesman said that his company's limits were set high enough so that white noise has affected just a tiny fraction of subscribers. He added that the ISP provides a bandwidth-monitoring tool that lets people see how close to the cap they might be at any given moment.
Forrester urges providers to move from
one-speed-fits-all to tiered services.
"We have costs to manage," he said. "But it has not affected the majority of customers."
Bell Canada's 10GB cap is unlikely to please many copyright holders. Pop songs average about 5MB; downloadable movies can average between 600MB and 800MB. That means the standard cap would allow a subscriber to upload or download about 12 movies a month or as many as 2,000 songs, although there would then be almost no bandwidth left for things such as Web surfing and e-mail.
Some Bell Canada subscribers aren't happy. A customer named Jason White says people in his household routinely engage in Webcam chats, video file previews and other high-bandwidth services that bring them close to or above the cap. The tools to monitor bandwidth don't work well, and Bell Canada has not been responsive in helping, he wrote in an e-mail interview.
"We called Bell (Canada) to ask what to do to check our usage, (and) they said to call every time, as it was not their responsibility," White wrote. "High-speed Internet from Bell (Canada) reminds me of dial-up. Maybe I will visit dial-up again."
Closely watched test
Other companies, particularly in the cable Internet business, are looking closely at Bell Canada's experience to see whether it can be applied to their own markets.
Cable companies are particularly interested in the idea for several reasons. More so than connections, cable modem subscribers can see the speed of their connections slow down--often dramatically--if other nearby subscribers are making heavy use of the network. Several people downloading movies over a cable network, for example, can significant reduce their neighbors' connection speeds.
The tentative moves within the industry toward caps appear to stem from economics, rather than any philosophical or legal position on file swapping. Copyright holders such as movie studios and record companies have asked ISPs to remove subscribers who are identified as copyright violators, but most ISPs have preferred to issue warnings rather than immediately cut off service. Most have strenuously resisted any policy or legal proposals they fear would hold them responsible for monitoring subscriber behavior online.
Verizon Communications went to court last month toa Recording Industry Association of America (RIAA) request for the identity of one if its subscribers.
No U.S. cable company has yet announced that it is imposing bandwidth caps. But most say it's an option.
"It's something we're looking at," said Jenni Moyer, a spokeswoman for the newly merged Comcast Communications and AT&T Broadband, which together comprise the largest cable ISP.
A representative for Cox Communications, another large cable company, said her company already identifies customers who are using large amounts of bandwidth for any reason and tries to encourage them to move to a more expensive tier of service. The company is reviewing its policies and is likely to set stricter guidelines in place for the maximum amount of bandwidth customers in each tier are expected to use per month, she added.
DSL companies have been less openly interested in the idea. An SBC Communications representative said that his company did not see heavy file-swapping activity as "a problem to be resolved."
The companies are examining each step forward with justified caution. Imposing any kind of restriction on Net users' activity has always been controversial, and companies have to balance any financial gains against any expected backlash.
Indeed, online message boards in the United States have been abuzz with rumors that AT&T and Comcast are preparing to impose bandwidth caps, after a report to that effect in an Australian publication. Some subscribers were sufficiently concerned to pen letters to the company threatening to cancel their accounts.
Nonetheless, analysts expect that at least some companies will implement the bandwidth restrictions, probably before the year is out.
"Some people might have to touch fire and get burned before they figure it out," Harris said.
A few ISPs are looking at alternative ways to combat the effects of file-swapping traffic on their networks, however. Harris noted that a few providers are looking at ways to block the traffic generated by specific peer-to-peer applications such as Kazaa or Grokster, or at ways to make those requests stand in line so that they don't interfere with other people's surfing.
Harris declined to say which ISPs are investigating those techniques.
Message boards have been rife with speculation that the AOL Time Warner-owned Road Runner has been blocking Kazaa, Grokster and related traffic in certain areas of the United States since last summer.
Mark Harrad, a Road Runner spokesman, said the company did not block the operation of Kazaa or any other software program. However, it does identify subscribers whose heavy uploads or downloads are negatively affecting neighboring connections, and it temporarily put the brakes on those connections' data speeds, he said. Those actions are triggered by overall effect on the network, not by any specific bandwidth cap, he said.
Wide adoption of bandwidth caps among broadband providers would not help embattled file-swapping companies that have struggled under the weight of lawsuits and lack of clear business plans. Still, Grokster President Wayne Rosso, whose company created one of the most popular file-swapping networks to rise from Napster's ashes, downplayed the threat, saying ISPs would suffer the most from such policies.
"The only thing they're going to accomplish is to make their customers angry," he said.