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Comcast Guts Its Unpopular Internet Data Caps

Comcast has announced a major retreat in its plans to impose data caps on broadband Internet customers amid increased regulatory scrutiny of the controversial practice.

The largest broadband Internet provider, with almost 24 million customers, said on Wednesday that it would more than triple its standard monthly cap by June 1 to 1 terabyte from 300 gigabytes. The move immediately impacts about 3 million Comcast customers who are subject to data cap trials in cities including Miami, Nashville, and Little Rock. The company was expected to eventually extend the caps to all of its customers.

Under the new policy, customers can stream 700 hours of high definition video or download 60,000 high-resolution photos before exceeding the limit, Comcast (CMCSA) said. Customers who go over the monthly limit are charged an additional $10 per 50 GB over, or they can choose to pay an extra $50 monthly for unlimited service.

“We have learned that our customers want the peace of mind to stream, surf, game, download, or do whatever they want online,” Marcien Jenckes, executive vice president for consumer services at Comcast wrote in a blog post announcing the change. “So, we have created a new data plan that is so high that most of our customers will never have to think about how much data they use.”

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Comcast has said almost one in 10 customers exceeded the 300 GB limit in its trials. Less than 1% of users would exceed the 1 TB cap, the company said on Wednesday.

Federal regulators this week approved Charter Communications’ (CHTR) proposed $66 billion acquisition of Time Warner Cable (TWC) and Bright House Networks under a number of conditions, including that the combined company not impose any data caps for seven years. Once the merger is completed, Charter would have over 19 million broadband Internet subscribers, trailing only Comcast as the largest provider.

Regulators were concerned that Charter could use data caps to discourage its customers from using Internet-based video services like Netflix (NFLX), which compete with Charter’s own traditional cable TV service.

Wednesday’s move even drew praise from Netflix CEO Reed Hastings. “Huge for me as a Comcast customer,” Hastings tweeted. “Now I’ll never be able to watch enough to hit my cap.”