In context: With more people staying at home and relying on connected devices to study, work, and get their entertainment fix, it shouldn't surprise anyone that Internet traffic has surged to unprecedented levels. Last year, broadband providers saw both a change in peak traffic as well as a change in peak hours, which prompted them to speed up deployment of additional network and server capacity in an effort to cope with the added demand.
Internet usage is surging to new heights, and individual households are going through data caps faster with every passing month. For people who use over one terabyte per month, their Internet connection is about to become more expensive.
According to a report published by vendor OpenVault, there's been a significant increase in the number of US Internet subscribers that are using over one terabyte of data per month. In the last quarter of 2020, over 14 percent of subscribers consumed over one terabyte of data per month, which is almost double the figure registered during the same period in 2019. This includes users with data caps and those who have unlimited plans.
Households that are on unlimited plans chewed through more data than those on capped plans, with 2.5 percent consuming over two terabytes per month. Average data usage across subscribers was 482.6 GB in Q4 2020, up from 344 GB in the same quarter of 2019.
Interestingly, most of this growth happened months after the first lockdowns were established, as the second and third quarters of 2020 only saw a moderate increase in data consumption. During that time, companies like Comcast, Verizon, and AT&T chose to suspend data caps, only to gradually reintroduce them alongside price hikes on all data plans.
Most ISPs impose data caps of around one terabyte, and that will gradually become a major pain point for everyone who uses streaming services and video conferencing apps, as those will typically eat through the allotment faster than just about anything else. For every additional 50 GB consumed, ISPs charge an average of $10, which can quickly pile up.
The source of this data, OpenVault is a company dedicated to supply data-tracking capabilities to over 150 cable, fiber, and wireless ISPs worldwide. Since 2012, it claims to have generated "over $150 million in incremental revenue annually." Its findings are definitely interesting, as they show that many Internet power users provide ISPs with the opportunity to charge more for unlimited data plans. Furthermore, if this usage growth trend continues, many more users that typically wouldn't hit their data caps will end up paying overage fees.