The Busy Hour and Data Caps

As states are getting ready to create their broadband plans for the National Telecommunications and Information Administration (NTIA)’s $42.5 billion Broadband Equity, Access and Deployment (BEAD) Program grants, we’re starting to see some interesting arguments being made by incumbents to influence state broadband plans. One of the aspects of the BEAD plan that hasn’t been discussed much yet is that the NTIA is stressing affordability. For example, the NOFO states several times that states must develop a middle-class rate plan. Everybody I know is scratching their head on what that means, but to the big internet service providers (ISPs), this must sound like rate caps – something they have vigorously fought everywhere. One aspect of high rates – data caps – is a big topic of discussion in the state. ISPs are making the claim that they’ve made many times that data caps are needed to manage the network. The rest of the ISP argument is that heavy broadband users are creating extra costs and should pay for the extra usage. But broadband costs are not related to the overall volume of broadband being delivered on a network; the cost is determined almost entirely by what network engineers call the busy hour.

[Doug Dawson is president of CCG Consulting.]