Are There Legitimate Reasons Why Data Caps Exist? (12:10)

Posted on by Abby Johnson |

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Since data caps are often associated with restrictions, most people immediately scowl when they hear any reference to them. Several public interest groups, including Public Knowledge and Free Press, have even called on Congress and the FCC to investigate them. These groups believe they threaten the open Internet and that they are harmful to online video services.

Eli Dourado, a research fellow at the Mercatus Center at George Mason University, has a different perspective though. As he explained to WebProNews, data caps from Internet service providers and mobile carriers are in place for legitimate reasons.

First of all, they are implemented to meet different user needs in terms of pricing. Some users can’t afford and don’t need a large data plan, but there are others who need more and are willing to pay for it. Dourado believes the caps help to meet all user needs.

Secondly, he told us that data caps exist to alleviate congestion. Since so many people use the same bandwidth, the caps help to keep everyone’s service running consistently.

Thirdly, Dourado believes that, without data caps, the entertainment industry would push to have ISPs become copyright police. He, specifically, told us that a SOPA would have much more potential without data caps in place.

He also said that mobile data caps are even more important than ISP data caps, since there is more congestion on the mobile networks.

Do you agree with Dourado, or do you think that data caps shouldn’t exist? We’d love to know.

Posted in: Business, Media, Mobile, Network Neutrality, Online Video
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