The streaming video company Netflix has said more than once that the idea of ISP putting broadband data caps on their service is little more than a money grab on their part. Now the company is using the editorial pages of a major newspaper to get their point across. The Wall Street Journal has an opinion piece today written by Netflix's general counsel David Hyman where he writes, "Bandwidth caps with fees piled on top are a lousy way to manage traffic."
In his editorial Hyman targets AT&T in particular for its use of broadband caps. Earlier in May AT&T announced that users of its DSL service would only get a 100 GB broadband cap while uses of the company's U-verse service get a 250 GB. AT&T charges its customers for going over that cap. However Hyman states that AT&T and other ISPs who have such caps claim that " ... bandwidth is a scarce resource and that imposing caps and overage fees will relieve pressure on high-speed networks."
Hyman, however, says that claims is simply not true, stating, "Wireline bandwidth is an almost unlimited resource due to advances in Internet architecture. Adding more capacity is easy. The marginal cost of providing an extra gigabyte of data—enough to deliver one episode of "30 Rock" from Netflix—is less than one cent, and falling." He adds, "All of the costs of supplying residential broadband are for supporting peak usage. Bandwidth consumed off-peak is completely free. If Internet service providers really wanted to manage traffic efficiently, they would limit speeds at peak times."
Netflix would obviously like to see ISPs do away with such data caps so its customers would not have to worry about overage fees or possibly being banned altogether while watch movies and TV shows from its service. A recent survey showed that Netflix is now the single biggest source of net traffic in the US.