The Internet “is how we deliver our shows,” said Jim Louderback, chief executive of Revision3, a three-year-old media company that runs what it calls a television network on the Web. “If all of a sudden our viewers are worried about some sort of a broadband cap, they may think twice about downloading or watching our shows.”
Even if the caps are far above the average users’ consumption, their mere existence could cause users to reduce their time online. Just ask people who carefully monitor their monthly allotments of cellphone minutes and text messages.
“As soon as you put serious uncertainty as to cost on the table, people’s feeling of freedom to predict cost dries up and so does innovation and trying new applications,” Vint Cerf, the chief Internet evangelist for Google who is often called the “father of the Internet,” said in an e-mail message.
But the companies imposing the caps say that their actions are only fair. People who use more network capacity should pay more, Time Warner argues. And Comcast says that people who use too much — like those who engage in file-sharing — should be forced to slow down.
[...] As the technology company Cisco put it in a recent report, “today’s ‘bandwidth hog’ is tomorrow’s average user.”
One result of these experiments is a tug-of-war between the Internet providers and media companies, which are monitoring the Time Warner experiment with trepidation.
“We hate it,” said a senior executive at a major media company, who requested anonymity because his company, like all broadcasters, must play nice with the same cable operators that are imposing the limits. Now that some television shows are viewed millions of times online, the executive said, any impediment would hurt the advertising model for online video streaming.
Mr. Leddy of Time Warner said that the media companies’ fears were overblown. If the company were to try to stop Web video, “we would not succeed,” he said. “We know how much capacity they’re going to need in the future, and we know what it’s going to cost. And today’s business model doesn’t pay for it very well.”