Time Warner shelves bandwidth caps

In a stunning change of course, Time Warner Cable announced that they’re putting "consumption-based" Internet billing on hold for now, citing a need for "customer education."

In a statement, the company said it will alter its plans, but was far from apologetic.

"It is clear from the public response over the last two weeks that there is a great deal of misunderstanding about our plans to roll out additional tests on consumption based billing," Executive Officer Glenn Britt said. "As a result, we will not proceed with implementation of additional tests until further consultation with our customers and other interested parties, ensuring that community needs are being met."

Time Warner Cable has endured two weeks of criticism and bad PR over its decision to expand trials of the tiered access plan, which included a selection of bandwidth levels in the price range of $15 to $100 per month plus $1 to $2 per GB in overage charges. Initial testing last year in Beaumont, Texas didn’t draw much attention, but the announcement of further trials in San Antonio and Austin, Texas; Rochester, N.Y.; and Greensboro, N.C. caused an outcry.

New York Senator Charles Schumer and Representative Eric Massa said they would introduce legislation to stop the plan. Customers flooded the company with angry e-mails. A website called StopTheCap became the de facto protest point. Ars Technica and Wired did some math and accused the service provider of price gouging as a defense against online video. Time Warner’s efforts at justification, including expansion of the plan to include more options and delayed start dates in some trial areas, had little effect.

All of this makes me think that merely delaying tiered pricing isn’t going to wash away the negative publicity. Time Warner says that it will start providing measurement tools and try to convince Schumer and customers that the plan’s not all bad. But the people that are screaming the loudest don’t merely want a sufficient bandwidth tier and price. They want to access the Internet without worrying about a potentially massive bill if they exceed their limit.

Here’s hoping Time Warner Cable comes back with a more enticing offer, whenever that may be.

Thanks to shaolin007 for sending in the Wired news.