Usage-based pricing gets FCC support

Consumer groups have balked at the notion of usage-based pricing and say customers should pay a flat rate for unlimited data use. The pricing issue comes up as regulators are struggling to find enough spectrum to keep up with wireless demand. On the CES show floor, more products than ever rely on wireless Internet connections and new services, such as live video chats on cellphones, use an enormous amount of bandwidth, exacerbating the spectrum crunch.

FCC Commissioner Robert McDowell, a Republican, said companies should be able to experiment with different pricing models, especially if private carriers are expected to finance the building of faster, bigger networks to expand wireless broadband services. If people pay for the bandwidth they use, it could reduce congestion on the networks as well.

“Pricing freedom has to be essential,” he said on a panel today.

A small number of users take up the majority of bandwidth. So charging some of the heavy users for that bandwidth makes sense, McDowell said.

“I think it’s time to let that happen,” he said. “Net neutrality proponents say it should be an all-you-can-eat price. But that will lead to gridlock.”

Meredith Attwell Baker, a fellow Republican Commissioner, indicated
companies could do other things to lighten the load on strained
wireless networks.

“Maybe we move back to a world where people pay for roaming,” she said.