Comcast is about to hit all internet customers with a data cap

Comcast Xfinity service vehicle.

1.2 TB

The threshold at which Comcast customers will see their service capped.

Comcast Xfinity

Smith Collection/Gado/Archive Photos/Getty Images

Comcast first introduced a data cap on home internet service back in 2012, and in 2016 expanded it to 27 out of the 39 states where the company operates. Customers were able to avoid caps for years in Northeastern states where Comcast competes against cap-free Verizon Fios, but it now says the party will end in January as it extends the limits to call all customers, regardless of where they are.

Grace period — The particulars of the cap will be a bit complicated to the unfamiliar, but the gist is that all customers will face a 1.2 TB monthly data cap unless they pay an extra $30 per month for unlimited data (or $25 per month for xFi Complete customers). Comcast says that 95 percent of its residential customers never exceed that limit, though, with the advent of game downloads and streaming and the increasing number of people working from home due to the pandemic, that could change.

Comcast is rolling out the limits with a courtesy month each year — customers can exceed 1.2 TB of usage one month annually without paying any penalty, but will be charged for any months the go over thereafter. When customers exceed 1.2 TB of usage, Comcast will automatically charge them $10 for blocks of 50GB, up to a maximum of $100 in charges in any month. There will also be an initial grace period, as the company won't charge anyone for overages until March 2021, giving them a chance to become familiar with the change and, if necessary, adjust their package accordingly.

Because it can, that's why — There's no real reason Comcast needs to impose caps — home internet usage has skyrocketed during the pandemic without providers breaking a sweat, thanks to years of infrastructure upgrades. If Comcast's limits were in the interest of reducing network congestion during peak times, a fixed monthly limit doesn't address that — slowing down the heaviest users during those periods would make more sense. Comcast used to do this throttling but ended the practice years ago.

Charging for data usage can be a lucrative revenue stream, and back in 2015, an executive admitted that data caps are precisely that. At some point, Comcast will max out the number of new customers it can add, and it will need to find new ways to generate revenue for the benefit of shareholders.

Unfortunately, internet providers are natural monopolies because once a company like Comcast enters a city and lays its infrastructure, it's too expensive for an upstart to enter the market and try to compete. As such, most people in the United States have maybe two internet providers in their area to choose from. And since internet providers aren't regulated like public utilities are, they can charge whatever they want. That often leaves consumers, especially those in rural areas, bent over a barrel.

Our only hope right now is that new competition from 5G service leads to positive change. It's supposed to provide speeds and low latency on-par with broadband internet. T-Mobile already offers home internet over LTE that doesn't include data caps. The problem there is rollout. It'll be years before 5G reaches outlying rural areas. Until then, they're beholden to the whims of companies like Comcast and Verizon.