Consumers prefer premium broadband to caps, metering

A new International Data Corp. survey shows consumers adamantly oppose bandwidth caps or metered Internet services but do see value in premium services that provide special treatment of voice, video, gaming, telecommuting or other specific applications.

According to the survey results, 94% of respondents saw value in such premium services and 54% would be willing to change to a broadband service provider that offered this service. A smaller number, 26%, was willing to pay their service provider additional fees for a premium bandwidth service, however.

Zeugma Systems, which makes network edge gear that enables such premium services, views these survey results as an endorsement of its approach to enabling service providers to generate new revenue and manage their broadband networks efficiently, said Kevin Walsh, Zeugma’s vice president of marketing.

“What this survey shows is that if you give [consumers] value that they can see and understand, they are willing to pay,” Walsh said. “Twenty-six percent were willing to pay more and 67% saw the value of a premium service.”

By contrast, 81% of survey respondents oppose bandwidth caps and being required to pay more for Internet use above a cap, and 54% said they would leave a broadband service provider which imposed caps.

“Some service providers don’t think that’s a bad thing, that the heavy users leave and become someone else’s problem,” Walsh said. “But the survey asked a lot of questions about what people do on the Internet on a regular basis, and based on that information, it is light to moderate users who are even more opposed to bandwidth caps and more determined to change service providers to avoid them than heavy users.”

One of the fundamental problems with capping or metered usage, Walsh said, is that consumers have no idea how much bandwidth they consume. In the survey, 83% said they either do not know what a gigabyte is or have no idea how many they use.

The survey was conducted by IDC broadband analyst Matt Davis during August, 2008. and included responses from 787 consumers.