State of Telecom Industry in Pakistan

Usage based pricing for bandwidth is common in Pakistan and other developing countries. In US, flat rate pricing is more prevalent. But that is changing as more and more bandwidth consuming products are becoming common. This causes worry to many who think that the change will hurt consumers and adoption of new services. Here’s one view.

Some cable companies have instituted monthly usage limits, though they are usually so high they affect only the heaviest users. A plan with 150 gigabytes, for example, would enable sending and receiving 75 million emails, or downloading more than 30,000 songs. The average Internet user consumes around 15 gigabytes a month, according to University of Minnesota professor Andrew Odlyzko.

Comcast earlier this year instituted a cap of 250 gigabytes a month. The company says the rule affects a very small minority of its high-usage customers. Some smaller and regional Internet service providers also charge on a metered basis, including Sunflower Broadband in Kansas. Frontier Communications Corp. last year briefly used metered pricing in Rochester before scrapping the policy in the face of protest.

“Unquestionably, the carriers erred in their initial selling of broadband with a flat rate,” says Elroy Jopling, research director of Gartner Inc. “They assumed no one would use it as much as they do now, but then along came high-definition movies. They’re now trying to get around that mistake.”