Internode is hiking up its ADSL pricing plans with increases ranging from $5 to $40 per month, citing the growing use of data-intensive online services and increasing network capacity costs as the catalyst for change.

"Since our last major plan changes, we have seen a boom in data-intensive online services such as BitTorrent and YouTube," said Internode's managing director, Simon Hackett. "As a result, average download volumes are increasing across all plans due to customers using these data-rich services. At the same time, the cost of delivering IP traffic has ceased to decline."

The new price structuring will only affect home and SOHO customers.

Worst affected are the HOME-1500-Power80 and HOME-Extreme-Elite; SOHO-1500-Power90 and SOHO-High-Power90 plans; all of which will incur a $40 per month price increase. All the other home and SOHO plans receive lesser price increases, while the HOME-512-Starter plan will have its data quota reduced from 8GB to 5GB. A detailed FAQ of the changes can be seen here.

"This is the only time Internode has ever had to move broadband pricing upwards, in more than six years of otherwise downward motion, and we don't expect it to be a habit - this is intended to be a single correction to ensure that our pricing is sustainable in the light of the changed economics of the industry in 2007," said Hackett in a posting on the Whirlpool forums.

Internode product manager, Jim Kellet, reiterated Hackett's comments but added that the price changes would only be in effect for 18 months and that once trans-pacific undersea cables were completed, prices would drop again.

The price increases were not the only aspect of Internode's plans to change, though. Internode's broadband speed shaping policy will also be amended in the coming months.

Currently, when users on Internode SOHO plans reach their monthly data quota, speeds are shaped to 128kbps download and unlimited upload, while home users are restricted to 64kbps both up and downstream.

However, under the proposed changes (set to take effect in the coming months) not only will home and SOHO customers' speeds be shaped, but now they will also be restricted to 3GB of data capacity once shaping takes place. After the 3GB has been exceeded, "additional access constraints" will be introduced. Internode has not yet said what these will be.

Customers who wish to avoid having their ADSL speed shaped will have the option of buying additional data blocks at a price yet to be determined.

Quite expectedly, Internode customers have met the news of the price hikes with resentment. A posting on the Whirlpool forums has already garnered over 50 pages of mostly angry discussion on the topic.

"I can't belive [sic] this price increase, you've seriously gotta be kidding. I'm on the 8mbit 40GB plan and now I have to pay an extra $20 per month to use it? or drop back to a $90 plan and loose [sic] half my downloads? Come on!" wrote Whirpool poster, Deimos.

Another Whirlpool poster, tmanau, wrote: "Well lets put it this way, it went $10 down recently then they jacked it back up again by the same amount within a short period of time. I have worked in the internet industry and now run an IT Business, and while I can understand price fluctuations, I know customers don't like it when pricing starts jumping around like that. That kind [of] yoyo effect is ok with hardware pricing, but not for services. With broadband uptake at record highs you would think there would be another drop."

But not all responses were negative.

"It's perfectly understandable to me why Internode are increasing their prices. I support them in doing it. Kudos to Simon for a rather heated and public release. I know I certainly won't be leaving just because the imperative is there to increase costs," wrote Zedd D1abIO.

Existing customers have an opportunity to avoid the price increase by either moving to a different plan or cancelling their service. The new price structuring will take effect from July 2 for existing customers and June 4 for new signups.