Demon Internet drops 'unlimited' business packages

Demon Internet has introduced a fair use policy for its small business broadband packages, putting a cap on the previously unlimited data it offered on certain products.

Announced on Thursday, the new policies involve a 200GB cap on Demon's Business 2+ and 2+ Pro packages and a 100GB cap on the Business 2000, 4000 and 8000 packages. The caps only apply between 8am and midnight, leaving unlimited usage available in the early morning.

"We've recently seen quite an increase in the amount of heavy users on our business broadband products, and as a result we can't continue to support completely unlimited use on these services, so we need to introduce a fair usage policy with peak hour usage restrictions," Demon chief Matt Cantwell wrote in a Thursday blog post.

"Less than 0.5 percent of existing business broadband customers are heavy users and use in excess of the limits we are setting, so the majority of existing customers will not have to worry, and if you're a new customer thinking of signing up, you'll probably be unaffected by the new limits too," he added.

Cantwell said that the ISP will immediately start monitoring its customers' data usage, although the fair use policy will not be enforced until 30 days after the announcement, or 21 August. He also announced a usage tracker tool to help customers check whether they are approaching their limit.

"When the policy is implemented, if your usage exceeds the new limits, your service will be restricted to 128Kbps during peak hours," Cantwell said.

Cantwell told ZDNet UK in an email exchange on Monday that he had taken part in a call with Demon's "heaviest downloading customers" as the ISP was consulting on its fair use policy. "About 25 percent were actually consumers rather than businesses, and I got the impression most of these were file-sharing," he said. "They asked me about copyright law."

"There are also businesses that have been downloading multiple hundreds of gigabytes of data, running the connection all day, every day," Cantwell added. "This can be for various reasons, from their broadband supporting an office of 70 people to running backups to running high-definition CCTV."

Demon's move is the latest in a trend among telecoms providers of shunning 'unlimited' packages in favour of clear caps. This has recently been notable among mobile operators, with both O2 and 3 dropping their claims of offering unlimited data.

In May, the Advertising Standards Authority (ASA) also asked regulators to examine the issue of 'unlimited' offers. It hopes this will help it to move on from having to make piecemeal adjudications about the truthfulness of such offers where fair use policies are in place.

Demon Internet is a longstanding UK ISP that now serves as the business and home office wing of Cable & Wireless's Thus business. Its home office packages already feature 50GB or 60GB caps, and its Premier Broadband and Dedicated Internet Access products retain their lack of data caps.

The changes affect Demon's standard business packages, which are intended to be used by between 10 and 20 people.

By way of comparison, a similarly-priced competitor to Demon's £19-per-month Business 2+ package is BT's £20-per-month Unlimited Business Broadband package. According to a BT customer services representative on Monday, this package actually has a 95GB monthly cap, although this information is not given in the terms and conditions for the plan. Demon's Business 2+ package has lower speeds — up to 8Mbps rather than up to 20Mbps — but a usage cap of 200GB.

Ovum analyst Michael Philpott described Demon's business deals as "reasonably priced".

"I would imagine that a normal small business would be OK with [the 200GB cap]," Philpott said. "It depends on what they're doing, but if they're heavily into graphics, they would probably opt for a much larger, business-grade service anyway."

Philpott noted that business data use was increasing as services move into the cloud. He added that specialised packages — for instance, plans with high data limits for videoconferencing usage — might become as prevalent in the business market as they are now in niches such as the gaming market.