Why is the Data Cap only in some cities?

my guess is it is because there is less competition in those cities...

Monopolies in those markets. And this is how you roll out rate increases / new revenue generating fees in most industries. If you dumped all the new costs on every customer at once they have more ability to organize, coordinate, and collectively drop the terrible company at the same time. Expect to see a hard push in Cox advertising in markets that see these new fees, trying to claw back customers they lost or replace them with new poor saps.