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Does Pricing of Internet Usage Steer Consumers or Meter Usage? Evidence from a Pricing Experiment

Brian McManus et al.

The Review of Economics and Statistics2026https://doi.org/10.1162/rest.a.1709article
AJG 4ABDC A*
Weight
0.50

Abstract

Competition authorities have expressed concern that firms selling broadband internet and TV subscriptions may employ usage-based pricing (UBP) of internet to steer consumers toward TV over streaming video. We study this issue with household-level panel data from an internet service provider's UBP experiment, capturing the prices' effects on internet and TV subscriptions, internet usage, and firm revenue. We find that this specific UBP policy largely served to meter internet usage by high-demand households rather than steer them toward TV. Households' payments increased due to usage-related overage charges and internet subscription upgrades to avoid overages. Some households avoided internet-related payments by reducing usage rather than adding TV subscriptions.

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https://doi.org/https://doi.org/10.1162/rest.a.1709

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@article{brian2026,
  title        = {{Does Pricing of Internet Usage Steer Consumers or Meter Usage? Evidence from a Pricing Experiment}},
  author       = {Brian McManus et al.},
  journal      = {The Review of Economics and Statistics},
  year         = {2026},
  doi          = {https://doi.org/https://doi.org/10.1162/rest.a.1709},
}

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Does Pricing of Internet Usage Steer Consumers or Meter Usage? Evidence from a Pricing Experiment

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Evidence weight

0.50

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.50 × 0.4 = 0.20
M · momentum0.50 × 0.15 = 0.07
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.