Bandwidth Caps for High-Speed Internet in the U.S. and Japan
Policy Paper
Aug. 10, 2009
As part of the Open Technology Initiative's continuing research to compare international broadband capabilities and policies, we have completed this report comparing bandwidth or usage cap policies between Internet Service Providers (ISPs) in the United States and Japan. Bandwidth caps are imposed limits on the amount of data or traffic a subscriber can consume over their Internet connection. The report compares caps across multiple pricing tiers for residential high-speed Internet services including cable modem, fiber-to-the-home (FTTH) or fiber-to-the-premise (FTTP) and Digital Subscriber Lines (DSL). The report reveals a large discrepancy in the usage limits ISPs place on consumers in the two countries, with U.S. providers substantially limiting the amount of bandwidth their subscribers can consume. The data has been juxtaposed with the price and the speed of the service offering and the complete data and sources are available in an appendix at the end of the report.
ISPs with the most constrictive bandwidth caps are in the United States. As shown in Chart 1, U.S. Internet service providers (ISP) have monthly bandwidth caps as low as 1GB for combined upstream and downstream traffic, while many Japanese ISPs only utilize bandwidth caps of 5GB per day or approximately 150GB per month for upstream bandwidth, with no limit on the amount of data consumers can download.
Chart 1: Lowest bandwidth cap proposed or implemented in the U.S.and Japan.
In the U.S., bandwidth caps vary by price and speed of the service offering. For example, Cable One has the lowest monthly cap at 1GB for their Economy Plan, which advertises speeds up to 1.5 Mbps down and 150 Kbps up. Advertising similar speeds, Cox's Economy Light Package and Starter Package allows subscribers to consume 3GB bandwidth a month for downstream and 1GB a month for upstream, which translates to an average daily consumption of 100MB downstream and 33MB upstream. From a user perspective, these caps mean that subscribers cannot download more than ten, or upload more than three, high-resolution digital photos (roughly 10MB/photo) a day.
Although services offered by Japanese ISPs are more expensive than these "economy plans," they are not only much faster but offer considerably more flexibility in terms of bandwidth consumption. In Japan, the lowest cap for residential Internet of the companies we researched is 150GB per month for upstream only, implemented by i-revo, a nationwide fiber ISP that provides up to 100Mbps symmetrical access. BB Excite, SoftBank and Internet Initiative Japan (IIJ) also imposed 420GB to 450GB bandwidth per month only on the upload side.
If a user exceeds these bandwidth caps, ISPs in the U.S. and Japan have different approaches. For example, if a subscriber uses more than 1GB on Cable One's Economy Plan, the company levies an additional fee for each additional 1GB of bandwidth consumed beyond the cap. For their other tiered services, Cable One may suspend the customer's service or require customers to upgrade to the highest tiered service. In Japan, most ISPs notify users who exceed bandwidth by email or letter. If the violation continues to exist, Japanese ISPs may suspend or terminate the service.
Even comparing the higher bandwidth caps in the two countries, including the highest priced residential plans, bandwidth caps in the U.S. are drastically lower and more restrictive than those in Japan. Chart 2 shows service options with the highest bandwidth cap in the two countries. U.S. ISPs such as Cox, Charter, Comcast and Cable One cap bandwidth from 20 GB to 250GB per month for combined up and downstream traffic for their higher-priced Internet services. Among these ISPs, Cox has the highest monthly caps, offering 300GB for downstream and100GB for upstream to Ultimate Package subscribers (50Mbps/5Mbps). Comcast caps bandwidth at 250GB a month, combined upstream and downstream, for all tiered Internet services. Continuing the U.S. trend towards more restrictive Internet service, AT&T has proposed bandwidth caps of 20-150GB a month. In addition, some ISPs, have imposed network management on users' Internet traffic.
Chart 2: High bandwidth capimplemented/proposed by U.S. and Japanese ISPs
As listed in Chart 3, not all ISPs in the U.S. and Japan cap usage. Of the U.S. ISPs we researched, Verizon is the only ISP that has neither proposed nor implemented bandwidth caps for subscribers of any of their service tiers. However, Verizon's terms of service explain that they may cap bandwidth usage or suspend Internet serviceif a subscriber over uses bandwidth. There are also several Japanese ISPs including KCN cable, famille and NetVALUE that do not have bandwidth caps for any tiers of their ADSL and fiber Internet services. Our research also reveals that fewer of these ISPs impose any network management on a subscriber's connection, such as slowing down peer-to-peer traffic or other limits.
Chart 3. No bandwidth cap implemented/proposed by U.S. and Japanese ISPs
This report demonstrates that bandwidth caps in the U.S. are more restrictive than in Japan. ISPs in Japanonly cap upstream traffic, if at all, and few impose network management practices to limit bandwidth consumption. The results of this report should encourage policymakers to investigate market conditions in Japan to determine how and why their networks supports far more per-customer throughput than comparable networks in the U.S. Additionally, regulators and policymakers need to investigate why Japanese high-speed Internet subscribers get faster speeds at lower prices, with fewer limitations than subscribers in the U.S.
For the full report with appendix download the PDF below.