What's the best way to make sure those who use the most bandwidth get charged the most money?

How about a tiered, "consumption-based" billing system? That was Time Warner's plan for its services -- that is, until huge protests at the national level down forced them to scrap the idea.

Rising Network Costs

Rising network costs are becoming a problem for providers like Time Warner, who struggle with the increasing popularity of downloadable songs, TV shows, and movies -- along with a deepening economic depression.

As Torrents and peer-to-peer (p2p) protocols continue to climb in popularity, the ability of these companies to keep up goes down. At least, that's what Time Warner claims.

Tiered Billing: A Great Deal of "Misunderstanding"

Time Warner's solution was a billing system that would rate customers on the amount of bandwidth they consumed. Those of us who use the web for news, email, and the occasional Windows game wouldn't notice a difference, but that system could have a dramatic impact on web surfers who enjoy media downloads or streaming video and music.

These people have, understandably, protested vehemently against that kind of a tiered plan. In a statement released yesterday, CEO Glenn Britt admitted that there was "a great deal of misunderstanding" between consumers, lawmakers, and his company when it came to the new billing idea. (Source: cnet.com)

Leading the charge against Time Warner is Congressman Eric Massa, who has vowed to fight the introduction of any tiered system. Although Massa was clearly pleased with the news that Time Warner was backing down when he announced it at a rally this week, he hasn't stopped his campaign to make metered billing impossible in the future. (Source: arstechnica.com)

$150/Month for Unlimited Usage

Originally, the plan called for download and upload caps between 10 and 70 GB a month, with prices ranging from $25 to $65/month based on bandwidth usage. Big downloaders would have been offered a 100 GB plan for about $75 a month. Those not satisfied with that could push for unlimited bandwidth, but it would have cost them $150 each month.

Time Warner, America's second largest cable provider, doesn't appear finished with the idea. However, it will have to silence Massa and his legion of followers before resurrecting tiered billing.