Editorial: Voice rate cuts, data rate hikes, and the case for metered billing 204
Tue, 26 Jan 2010 2:01 pm EST 
Both Verizon and AT&T have recently dropped the price of their unlimited voice plans from $100 to $70 a month. While we (we being the tech media) generally assumed that the price cuts were an attempt to lure more customers. We tend to forget a few days after their conference calls that the #1 and #2 US cellular networks are having no trouble picking up and retaining new customers, even with their rates considerably higher than #3 Sprint and #4 T-Mobile (T-Mobile is at least still gaining subscribers, unlike Sprint). So why the price cuts?
It’s not to reward customers, that we can guarantee. Rewarding customers is not a part of any profit-driven corporate business model, so long as rewarding doesn’t come with some sort of trade-off. There’s clearly got to be a trade-off here, as Verizon and AT&T aren’t about to sacrifice their profits. Chris Riley, policy counsel for Free Press (a net neutrality favoring Washington-based non-profit consumer advocacy group), may have the answer: “The carriers are just trying to win political points and goodwill to use on gouging people more on data plans later. They are under a lot of scrutiny by the Federal Communications Commission, but people are still paying a lot of money for voice and data plans.”
Higher data rates are the three most painful words ever heard by any smartphone customer. Customers are using voice less and less these days, opting for communication via text messages (which US carriers already double-charge for sending and receiving), IM, and email. Future evolutions of communication, including cellular video chat, will only serve to shift more of the communication burden onto data networks. With that in mind, it becomes clear that lowering voice plan costs and throwing in things like Mobile-to-Mobile on Sprint or Rollover Minutes on AT&T or Verizon’s Friends & Family are mostly token gestures to gain the goodwill that Riley spoke of.
The future looks bleak for the current cellular pricing structure, especially for users on the high end of the data usage spectrum. Both Verizon Wireless CEO Lowell McAdam and AT&T CEO Ralph de la Vega have admitted that given emerging usage trends among smartphone users, the current pricing structure is fair to neither subscribers nor the company. Here’s a no-brainer: should someone who uses just 1 GB of data a month have to pay the same as another who pulls down five times that? You don’t have to respond, you know that the answer is “no.”
The problem is that smartphone subscribers in the US are used the word ‘unlimited,’ even if our data plans never have been. Sprint, T-Mobile, Verizon, and AT&T all cap their so-called ‘unlimited’ data plans at 5 GB and can hit you with overage charges or worse (throttled, suspended, or canceled service) if you exceed the limit. With the revamped voice plans, Verizon and AT&T also tweaked their data overage prices, with Verizon charging $0.20 per megabyte over the limit. A subscriber that were to go 500 MB over the limit would be hit with a $100 overage charge (Verizon is charging a painful $0.50/MB for their 25 MB data plan for messaging phones).
While adding any type of capacity to a wireless network is an expensive proposition, increasing data capacity is beyond expensive. Not only does the carrier need to put up more towers, but the ones already in place need to have new higher speed and higher capacity transmitter/receivers installed. To support that expanded aerial bandwidth the carrier also needs to increase the capacity of what’s called the ‘backhaul’ - the fiber optic lines connecting the tower to the local call center. Of all the network upgrades, this is the most expensive and problematic. And to handle the increased traffic that the thicker pipes bring the network then needs to upgrade the processing computers at the call center.
As cellular speeds continue to increase with LTE and WiMax deployments coming up, the upgrade process is only going to become more and more expensive. Mobile devices are becoming better and better at consuming data, and that is not meant in the good conservative way. No, our devices are getting better at pulling down data even without our asking, with webOS being one of the chief offenders.
The simple fact is that the current data plan structure is broken, and it is users like myself that have broken it. And while I don’t like the proposition of not having a dirt-cheap unlimited data plan, the reality of our situation is that we don’t have one now. Sure, right now it takes some significant doing to exceed the 5 GB cap with a smartphone alone, but if you use it to tether your computer or start downloading music from Amazon MP3 or watching lots of YouTube videos you’re going to exceed 5 GB before you know it.
While there are many solutions to the problem, the most logical and reasonable is to move to metered data rates. That is to say, pay for the data you use. The more you use, the more you pay, simple as that. Of course, we can’t live with a system where we’re charged per megabyte like public utilities are wont to do. The solution is a tiered pricing structure coupled with overage packages. First you select your data package, something ranging from 1 GB to 5 GB, or more if the carrier is feeling generous. If you come close to exceeding that (within 500 MB), you get a text message alert warning you that exceeding your cap will require that you purchase an additional data pack at a higher rate. Once you're much closer (within 50 MB) you’ll get another warning with the option to purchase the overage pack. This way the carrier can charge more to users that pull more data - and hit them hard when they’re wanting data and close to empty - and those that don’t aren’t going to have to pay for bandwidth they’re not using and the excesses of others.
Let’s make a data pricing structure for the fictional wireless company I’m going to call AT&Sprizon-Mobile.
Up to 1 GB: $10/month ($0.01/MB)
Up to 3 GB: $20/month ($0.007/MB)
Up to 5 GB: $30/month ($0.006/MB)
Up to 10 GB: $50/month (0.005/MB)
250 MB Overage Pack: $5 ($0.02/MB)
Most subscribers will think little of paying an extra $5 to keep their data service going, especially if they’re more than a few days from the end of their billing period.
With this plan customers would pay no more than they are now, though AT&Sprizon-Mobile could stand to reap the benefits of frugal customers opting for the 1 GB plan and grossly exceeding their data usage. If the hypothetical subscriber on the hypothetical plan were to use just 1.8 GB in a month (that’s four extra overage packs), AT&Sprizon-Mobile will pull in the $30 that the 5 GB plan would have netted.
Additionally, if the carrier wants to pull in even more money, they’ll make tethering both free and easy. While more subscribers hooking up more computers through their phones means more data being pushed through the pipes, it also means that customers will be exceeding their limit and being strong-armed into buying overage packs earlier and more often.
Could this put the hurt into some subscriber’s wallets? Yes, it very well could, but it will also reward those that aren’t straining the network’s capacity. And it will also give the carriers the cash they need to continue churning out higher profits while improving the network infrastructure.
204 Comments
Personally, I have no problem with the 5GB limit on most mobile carriers, even though a 250GB limit on my Comcast bothers me.
I honestly think you were paid by the big telcos to write this article. It makes NO SENSE to customers. I hope you expected to get many negative comments. The truth is technology is getting faster, cheaper and smaller every day. Costs will not increase exponentially with each upgrade because new tech will eventually be priced similarly if not cheaper.
I agree with 0.00% of what this article says. I'm not asking for free or super-cheap plans for customers, but something that's reasonable for both customer and provider. The truth is that people will stop using their services if it becomes to expensive or confusing to keep track of their charges. I love my smartphone Pre but the minute I feel its becoming more of a hassle than its worth, I'll cancel my account and be done with it. I don't need anything the phone does that badly anyways. It's just cool and CONVENIENT to have. Once it becomes inconvenient, I'll be outta here; jump to Metro PCS or something and get a dirt-cheap voice-only plan. Financially, there are a few not in my boat, but there are so many more folks who are.
I want to make this clear: I switched to Spring and the Palm Pre because it was cool and AFFORDABLE, and I will stand by my principles if Sprint decides to change their terms of service and/or rates.
amen
Seconded
here here.
You clearly have no idea how much data networks cost. The rate of reduction for cost per performance for your cell phone may be good, but it costs a LOT of money to upgrade -- and sometimes virtually replace -- the towers and backhaul networks, especially if new cabling has to be run. In some cases, this means miles of fiber optics being run to them when their older copper-based connections are no longer able to cut it. The longer the run, the lower the speeds over those connections. The cost for that is extraordinarily high, and there are a lot of places where it's required. Microwave relays may become more common, but they're expensive to install themselves, and may require extensive (and expensive) permit processes.
Costs per fixed measure may not increase exponentially, but these are not fixed assets. A few years ago, smartphones were the exception. Their popularity -- and the popularity of phones in general -- is much higher now, and will continue to grow. Data requirements also continue to grow. Put them together, and the deployment costs don't decrease, but instead increase.
Look at what's being spent: Sprint's WiMax rollout is expected to cost more than $5 billion to cover two-thirds of its subscribers, while leaving vast, less-populated parts of the country uncovered. AT&T is said to need to spend that much just to catch up to where its network should be, let alone the costs of its LTE rollout. Verizon shelled out $9 billion for its LTE spectrum, and still has to add deployment costs to that, with plans to cover their entire 3G range with 4G by 2014. And once the networks have their 4G coverage in place, they're going to start looking at how to get even faster, and that's going to require more upgrades.
These cover upcoming items, and don't address maintaining the existing network, which does involve installing new towers on occasion. New towers means easements, leases, and/or zoning changes, and that's before construction costs. These things are not as cheap and easy as you think.
@ Martin Blank
There's also a little-known thing called "the Internet" which continues to get faster and harbor more users and fatter pipes for all that data, yet prices (via ISPs such as AT&T, Verizon, etc.) continue to stay constant -NAY!- come down as time passes. We all know how well Comcast's 'metered' pricing structure is being received...
I understand the cost of upgrading is not 'chump change.' What I DO understand is these companies continue to make money hand-over-fist with their wireless/mobile services, and are seemingly dragging their feet to get us to the 4G era, all while charging the same prices for their services (in the case of text messaging, charging more: $0.20 per txt, WTF???). I remember when Verizon used to charge $0.02 for received messages, and only $0.10 for sent messages. Times have changed, haven't they?
Martin Blank makes a valid point stating that the upgrades will not be cheap. I do not think any of us dispute that. But you missed the main issue by not referencing historical trends. I stated this in my first post: technology is getting faster, smaller and cheaper every day (read: Moore's Law). From laptops, desktops, phones and the networks they use, innovation has afforded us low-cost, high quality gadgets we have the pleasure of using every day. All we are asking is for the cost-of-entry to stay constant with other market trends in the tech fields (i.e. stay the same or go down). I'm all for paying a company for what I feel their service is worth; right now that is Sprint and their affordable "Everything Data" plans.
I'm not sure if all that made sense just now; hopefully someone can make sense of it. I have a cold and am going to bed. I'm grumpy...
You're missing a lot of factors.
You point at the profits that the companies are making as "hand over fist," and yet ignore that Sprint (your provider) hasn't made a profit since 2006. Verizon and AT&T have made profits, but that's across architectures that include cellular, landline, and data line operations. I just checked Verizon's cash flow from its financial statements, and it's net change in cash is down $8.5 billion for the first nine months of 2009. Sprint's cash is up, but it also had the tower sale last year to buoy the numbers. AT&T's cash is up, so I will partially grant your point with them (but they've been told by everyone for the last couple of years to get to upgrading their network). T-Mobile is harder to judge, but they've had significant troubles just getting their 3G network operational, and it's smaller and spottier than AT&T's.
Growth of wireless speeds is also not as straightforward as you portray. In 2006, there were 175,000 cell towers in the United States. That was, at the time, expected to grow to 260,000 towers by 2010. That is a giant list of circuits and electronics to maintain, let alone upgrade. In addition, even with technologies to arrange channels, there is still contention for the medium. Only one device may transmit on a channel at a time. This limits the ability to grow a wireless network as quickly as a wired network.
There are some questionable practices, such as the cost of text messages (but then look at what happened to Sprint's network when Boost rolled out the unlimited plan at $50, and SMS delays grew to hours in some locations). They probably can spend some of the money more efficiently. But the idea that the telcos are just sitting around in piles of cash laughing at the people that want faster connections largely doesn't hold water.
I'm not exactly sure what you are complaining about. The name of the game is supply and demand. If you don't like paying more for data, then don't pay for it. Like you said in your earlier post, there will always be the likes of MetroPCS. If enough people come to the same conclusion, then the "Big Bad Corporations" who just want your money will have to lower their price to stop losing customers. That's how the free market economy works. If they aren't making money "hand-over-fist" then they obviously don't have a very good business plan and they won't be around very long to be complained about. Or to sell you a data plan any more for that matter.
hahaha that's a funny comment... Here's something I DO have experience with. I frequently go to Europe for things having to do with school, and I stay there months at at time. My internet plan over here is an extremely fast 20 Mbps cable service that I pay ... GET READY FOR IT ... deep breath... the equivalent of $25 with cable television included!! I get downloads at over 1.5 Megabytes per second consistently. In the USA for some reason this would be $50 or more. I don't have a special deal or anything, this is just among the more expensive plans here. So while electronics and hardware cost less in the US, it still costs more.
If you accept these higher prices, companies sure know how to give you those. As a consumer, you should dictate what is affordable, NOT the company telling you how much it is. In the end they are always looking for ways to make a BIGGER profit.
omFg! Derek just sold out. I guess we could see that coming.
*sigh*... When will P|C look for some new staff members?
As shareholders of P|C, I think it's about time we got somebody who isn't trying to write controversial articles that really aren't related to webOS at all.
Here's a great idea... let's all suggest a tiered data scheme where we, as individuals, LOSE!! What a fantastic idea! Let's turn Sprint's $70/mo + 20+% discount + $20 monthly recurring credit with UNLIMITED data and UNLIMITED voice calling to ANY cell phone on ANY network into $70 for ONLY voice, PLUS whatever the carriers feel like charging us that month for data. Really frickin' brilliant.
Perhaps Derek needs to return the money that VZ and ATT have paid him and quietly quit his position at P|C. It would only make sense on EVERY level that one could possibly imagine.
+1 derek should quit while is way behind
This Blog article is the biggest bunch of BS I've read in a long time. It really reaks of TROLL posting from usenet. Way to stir it up! MY answer from the first second I read that line about being fair... YES YES YES That is what they are selling so if someone is only using 1G of Data when they could use 5G for the same price. They are not getting as much for thier money. That is all.
Amen!
i completely agree. getting emails and checking the internet on my phone is nice, but not if i have to be worrying about how much data i have left. once i have to worry about that, the phone isnt worth it to someone like me. im disappointed that this is the precentral stance.
i dont think its precentrals stand but derek's... hey why dont u move to russia where u would fit in derek!!!
What?! So my $170 for 4 lines with unlimited data, sms/mms is a bad deal?
It's a good deal for you. It's not right, though.
Not "RIGHT"???
C'mon man... Seriously???
Big business is going to do what is "right" for their bottom line and it has nothing to do with with anything related to morals. Which is what you are implying (by it being unfair").
This is no different than ISP's charging for actual data usage. On top of tier their bandwidth pricing...
You already essentially pay more for higher mobile bandwidth (more expensive phones and plans). Just like a ISP... why should consumers also be willing to pay for for their actual data usage on top of that?
Mobile data has been coming for years... If they have not been planning appropriately... then they will fail.
+1 Amen
ISP's charging by overall bandwidth usage has failed in test markets, and it will fail in the future. Its an old fashioned plan that companies are trying to shoehorn into a totally new world.
Data is the norm... Data is the future
Like Gman said, if they don't invest in THEIR future, then they will die off, because we as customers will do whats 'Right'.
ISPs are not charging per byte, but they are charging for speed tiers. It's not a big jump from there to speed-usage tiers such as are used in data centers. You can get a server with 1Mbps of bandwidth but 100Mbps connectivity. This allows bursting when necessary, but if your 95th percentile line (the line under which 95% of your bandwidth usage falls) crosses the 1Mbps line, you pay a higher fee for that month.
The tiers that are discussed here would be just as easy to do. I'd like the option to see that I'm approaching a higher tier and be able to go through a web interface to bump up my plan for the month, and then have it reset at the beginning of the next billing cycle.
Not Right? Not right for who? And not right on what level? If we're sitting here wondering about the moral ambiguity of capitalism then you have to ask yourself... is suckering the customer into paying more money by openly allowing them to make the wrong decision right?
This is capitalism, and more than that, this is both the customer and the providers right to charge what they will for a service that by an large can be provided for a lot less money then they net on a monthly level. The 'backhaul' that you speak of is expensive, yes, this is true. The same goes for upgrading to bleeding edge technology when it first arrives on the market. But if your under the impression that these are simple expenditures they you are patently wrong. These costs come with an incredible benefit to the company since they can provide better/more service. Look at AT&T, they hemorrhage money, and do literally nothing to upgrade they're network, and people still use them for the iPhone and the iPhone alone. Once that exclusivity is lost their customers are going to be able to choose a network that actually works better, and AT&T will loose subscribers en-mass. If they invested money into upgrading and providing better service, then they most likely wouldn't have the all of the ill will that most of the customers that use them face, and in turn would continue to gain more customers.
If you have a Pay-To-Park garage, and it starts to become full, then you obviously cannot park any more cars there. You have no limited your intake since the idea is that with more space you would have more customers parking in the garage. So the obvious choice is to expand said garage. Sure, its going to cost you some money up front, but you make that gamble with the intent to attract more customers. So in the end its an investment, which is what all that upgrading cell providers do is.
You stated that a profit based company doesn't reward the customer unless it rewards the company. Why then, would we ever agree to paying exorbitant fees on top of paying for our regular service? Those fees, by your own logic, and described by you, are designed to screw the customer.
If you are endorsed by AT&Sprizon-Mobile, then I can't fault you or your logic... but as a consumer of goods, shame on you for trying to help large companies turn that screw down harder, because as you said, there will be no reward in it for you in the end.
It sounds like he is trying to say it isn't right for the folks who use relatively little data to subsidize the folks who use a lot.
Are you kidding me? I thought I heard you say this is capitalism but you obviously don't understand what that means.
If AT&T makes bad choices about not upgrading their network, that is their own fault. This is capitalism after all. They have to live with the decisions that they make. And if they decide to make a business model that involves exclusivity with the most popular phone on the market, that's their decision as well. This is capitalism after all. And if they decide to raise their price for data plans and people are willing to pay it, that's again their decision. This is capitalism after all. And if people are not willing to pay and they lose a majority of their customer base and end up getting completely knocked out of the wireless market, then that is once again their decision. Guess what? It is capitalism after all.
Those fees for a data plan are to make money. If that is what you consider to be screwing the customer, then you are definitely not a capitalist. You are a socialist and you are free to have that opinion. But don't claim to be something that you are not.
+1 on that
The cell companies are in the cell phone business. If they can't provide an infostructure to support their marketing claims then they better upgrade their service without passing the cost on to the consumer or get out of the business all together.
Maybe the cell phone exec's should channel the money they spend for advertising into their infostructure.
It sounds like your just complaining about your bill.
If it's not a good deal then switch phone companies. That's what I did. (I love you Sprint!)
Or drop data service if you don't use it that much. If this was a real problem the phone companies would have already done just what you outlined.
People pay more for less service than others all the time. It's called the free market. They're free to do so or not anytime.
I've reread this, as much as I could take, along with some comments, as much as I can take and I have no clue what this article is about or what some of the comments are about.
Some carriers are more expensive than others.
Some people don't mind paying that extra because they feel they're getting better service.
Some people are happy with regional carriers and the small guys like Metro and Frawg.
I personally love my Sprint plan. Each line come out to less than my 1st line I started 3 years ago.
We go through about 10k texts total and maybe 1k photos monthly plus I can use almost 2g of data while the other lines are using 500mb.
People just aren't going to pay what they don't feel comfortable with especially if they feel like their being gouged.
So what's the point?
well they did say unlimited and i think that if we want unlimited then go on strike dont use your cell phone for a day or everyone who has at&t should just drop their plan and switch to a differant company the problem here is to many little brats that are like 8-14 get their ipohones and just start rakin up data without thinking about it theis little brats have no real need when other users are trying to send out very important business emails now whitch is more important rainbow princess or that email u need to get to the ceo of your company so he can accept the plan to expand the company or to just get a simple message through. and seriously we all know that the majority of data is probly little brats texting and web surfing while in school
1) Text messages do not use data. They're carried on the carrier band that the phone uses to connect with the tower.
2) I don't know about you, but I've found that capitalized letters and periods make reading text much easier.
I wonder if he types that way in emails to the CEO? ;P
LMBO!
to #2 - I agree, and to the op, Surely you arent one of those business people are you? from that text block and grammar I'd say you're one of those teens...
Maybe the OP just forgot to put them in...lol
That is a huge wall of text tho...haha
When did OP start standing for Original Poster as opposed to operator (like Sysop used to mean System Operator on the old dial-up bulletin board systems).
ok -- I just realized how much I am showing my age here.
lol, the texting generation strikes another blow! haha
good observation, but then again, where are all the obligatory emoticons?
I understand your point but your telling me you use a shit load of data just to do emails? I'm sure you're surfing right with them when your sitting at your desk at work or similar situations.
Data usage for just email (and basic web surfing) is relatively low. It's Application downloads, VVM, Video streaming, etc. that is driving high data usage.
These are also things that all carriers are adding to attract more customers and compete in the marketplace.
If they have not thought their plan through enough to think "If we get new subscribers and people actually use the new offerings we are using to attract them, how will we support them on our network?"
Then they have failed themselves (their company)!
The get paid millions of dollars to make these decisions and keep their companies moving in the proper direction. If they cannot do that it's the companies loss... not consumers.
Breathe!
Often times.... I'll just sit around and surf the web... or text my friends 1 letter at a time for the sole purpose of screwin with "The Man." I know that "The Man" is always trying to grow his empire and using my 1x data connection for many minutes everyday just may keep the man from receiving important emails about expanding his empire. Am I a brat? Maybe. But so is Christopher Eugene Orton (CEO).
As much as I generally hate kids, I have to say that I don't have a problem with them using all kinds of data. They may not be paying the bills but their parents are. And therefore they are entitled to use just as much data as anyone else.
Furthermore, I'm sorry but I think Rainbow Princess is more important.
People are using less voice and more data by the day now so makes since the carriers start itemizing them more. Their trying to deter peeps from overtaxing their outdated networks that really none of them can afford to upgrade.
AT&T made $4 billion (with a B) in profit in Q4 2009... I think they can afford to upgrade their network.
http://www.precentral.net/rumor-att-prepping-network-handle-new-devices
When my wireless provider and broadband ISP becomes the same company (I'm looking at you, 4G), you bet your bottom that these 5GB limits will go away very, very soon.
4G cannot steal customers aware from Cable/DSL/Fiber with such low caps and high rates. They need to make their business more reasonable, or face stagnation.
It will come; it's inevitable, actually.
Sprint 4G plan does not have a 5G limmit. It is unlimited.
This is what I am waiting for, and have been for a long time now. I need 4G in my area so I can make it my main ISP. I currently have AT&Tyahoo DSL, which sucks because they have not once bother to upgrade our system here so we can access the faster DSL speeds. 1.5mbps is the speed of my DSL, Sprint's current 3G is almost as fast and sometimes faster. I pay for this crap internet because cable (TIme Warner) in my neighborhood is crap and always has problems, and I pay for a Sprint 3G broadband card as well. I would be more then happy to combine those two payments into one and give it all to Sprint for a faster (then both my current options combined) 4G connection anywhere I will be taking it in my area.
Im also waiting. Dallas, Austin, and San Antonio all have 4G in Texas. I live in Houston. How does Houston get passes over for these other cities. Im ready to dump everything for a 4G Mifi hotspot.
Not just San Antonio, Dallas, and Austin, but also places like Lubbock. Texas might have more coverage then any state right now. I live in deep south Texas on the border so I am hoping we get it some time soon as a Lubbock type market. I read earlier today either here or on Engadget that Houston is one of the cities Sprint is looking at adding 4G to this year so you may be good to go soon. I know I would buy a 4G phone for sure even if it isn't here because it would make all my trips up state even more fun.
There is Wimax Covereage in Houston already from Airband Communications. It's only available right now for businesses, however. Sprint/Clear will be there before the end of the year.
@Derek Excellent article! -- well written and the ficticious messaging snapshots were a great idea.
I too am a voracious user of data. Just wait until WebOS 1.4 comes and we can shoot, edit and upload videos from our phones. That should jack up the average data usage rates even for folks who typically don't use a lot of data.
All in all, this seems fair to me as well.
OMG I cant wait! I already hit 4.5 GB last month! Yup just wait, Youtube here I come!!! lol
While I agree with most of what was said, what bothers me is that both regular ISP's and Cell providers say "unlimited" but mean, "as much as we think you should use". I'm in IT and use alot of bandwidth at home and on my phone. If it's unlimited give me unlimited, but if it's only 5 GB, say, " up to 5 GB". Don't lie, then charge me fee's buried in the fine print. ATT bitches about all the iPhone user's, but you gave them the devices to pull that much data, you damn well better have a good estimate that more than 3 people may be pulling data at once. I get sick of "we weren't expecting that much", or "the phones change too fast". We have the oldest, slowest, and most expensive cell plans here in the US, i know there is alot of ground to cover, but think it through and plan accordingly, we'll pay if we need to pay, but give us the service you promise and keep up with the jones' for goodness sake.
I don't like the rhetorical question. If we have an unlimited plan (even if it is capped by the mythical 5GB limit), then NO! someone who uses 1GB should pay the same as someone who uses 5GB.
BTW, if they are going to this there are several things carriers need to do:
1) Provide a detailed usage of data. I don't just want them to say "well, you used 2.8GB so you owe us $150", I want a detailed bill that says what sites I pulled that data from.
2) Any apps purchased are excluded from this usage (after all, I bought the app, if you want me to then pay to download it then that is effectively an increase in price).
3) I want forced syncing of contacts and data with Facebook, et. al., waived from the fee as well. After all it is Palm that is forcing all those contacts to be synced, not me!
4) Anytime I have to redownload apps because I got a new phone, had to doctor my phone, etc. should be exempt.
So, I guess my question is how much more "accounting" are the carriers going to need to do to see this implemented?
Palm is not forcing you to sync your Facebook content... you are.
Sort of true, they are forcing me to sync ALL of my contacts. If they are going to charge for data in this fashion, I want to be able to choose which ones to sync.
I know, I know, this is a piddly amount of data, but it is the principle of the issue.
lol... True not alot of data but consider the fact that people change their photos on Facebook very often. Atleast the people who are on my friends list do. But I wish I could create a list on Facebook to specifically link those contacts to my Pre.
you MIGHT have something on the DL'ing of apps, but as for restoring them after a reset you'd have a hard time on that one. Are wireless networks that hard to come by for you?
I think typing "Yes..." in response to that last message is gonna bounce back with an error message due to those ellipses. :-P
If this was to become a reality, I'd like to see some reasonable "rollover" concept for data, too. I agree with the basic premise of metered billing, but I have no faith in carriers doing it right. Inevitably the pricing structure -- I suspect the carriers would charge way more than what you propose above -- will force many to get the lowest plan they think they can get away with, only to get f'd even more by the overage charge. It would be a step backwards in progress if people become hesitant to use mobile data because they're worried about charges. But carriers -- stupidly -- care about charging more, not giving you a nice warning for upsell.
The plans and limits would only serve to stifle innovation and slow any improvements carriers made to their networks, by removing part of the main incentive for them to do so. Admitedly, they wouldn't be able to charge a million users for 5gb if they couldn't squeeze 5gb through to a million users, but the bottom line is they'll run people off to other carriers really fast if people start getting hit with huge unexpected overages.
Also, I think if you pay for unlimited but don't use it, it shouldn't cost me, who uses it more, more, if you don't need unlimited, don't buy it. You pay 12 bucks for buffet and pay 8 bucks for a plate for a reason, if you only want one plate, don't get the buffet.
I think what your article proposes is going the wrong way.
Your perspective is that bandwidth is so limited that we must ration it. The ISPs tried this years ago and if they stayed with this limiting model, they are no more.
Wireless data usage is increasing exponentially. No amount of rationing will save the day. Rather than trying to limit usage, the carriers who find a way to provide ever increasing wireless bandwidth will prevail.
It's as simple as that.
let me open my chorus book, i shall sing while you preach, oh profit of the profit.
Do you mean prophet of the profit? I was confused by that.
Yup, with the way the mobile phone market is heading, investing in infrastructure is the only way out of this. What the mobile telco's are trying to do is milk the value of their current infrastructure as much as possible at the expense of the customer. The author's solution is so wrong and the question of whether or not somoene who uses 5GB a month should pay the same as someone who uses 500MB a month is irrelevant.
With a 5GB limitation already on most carriers there is no such thing as a bandwidth hog. That is some BS mobile telco execs have made up. If their network can't handle the data demands they need to invest, plain and simple.
err. mi tipe gud. yes, prophet of the profit. Thank you. :)
haha, I just wanted to make sure that was what you meant.
This is another reason why I love Palm users! We've come a long way since the Pre was release and the cool phone for all the vulgar kiddies. Witty humor and willingness for picking on one's self goes a long way when reading through the responses. "I love you guys" (in Cartmen voice)
Well, they'd better start upgrading their equipment. I already pay a lot for internet and mobile, if they want me to use "cloud", and buy games, apps and check my email, messaging, etc on my phone, they shouldn't limit my usage or charge more for that, otherwise I would keep mobile for phone calls and my computer for data usage. That's my opinion, others could afford that and never complain, but would be the same with internet, if they start charging for emails or cap my usage I would feel less interest if I had to control my internet activities because of my budget.
If they don't have capacity to provide they should not sell. Personally I don't agree with this market strategy, like web host that sells you a lot of storage for cheap, but they expect you'll never use even a half of that, or if everyone started using it they would be in serious trouble because they don't have the equipment to provide such a huge storage for every client if everybody use it at the same time.
Great article Derek, thanks.
As sad as it is that we can't have everything for free, this was definitely an interesting editorial. I don't know off-hand how much data I use on a monthly basis, but I do spend a lot of time on my Pre browsing the web. I don't use YouTube a whole lot, or download much, so I'm sure it can't be terribly high. But this is a reasonably proposition, giving the circumstances.
And I wanted to get clarification on what you said about downloading from Amazon MP3 over the data network. Last I knew, you had to be connected to a WiFi signal in order to download from Amazon MP3. Has that changed recently?
Yeah, it's been available over 3G for a while. Since around September, actually.
I think I'm probably an average customer. I don't use much data and or voice but I use it when I want to. I like not having to worry about how much I'm using. If they start limiting data (especially on phones that operate online constantly without user knowledge, ie pretty much all newer smartphones) I will probably say forget it and just go back to plain jane voice only style flip phone with texting and mms. I just hate having to worry about limitations such as how much I talk, surf, or text. I'm betting a good 70% of us are probably in that category. So if they want to cut their profits I say go for it, give me an excuse to drop my bill from $225 a month back to the more reasonable $65 a month I used to pay. Heck, maybe I'll just drop texting also and drop it down to a $45 per month. Just a thought. Wireless carriers should remember that as much as they like to think of themselves as a necessity, I would drop them before I canceled my lawn service or even my cable tv if it really came down to it.
I kind of agree with your main point there. If the price spiked enough, I would dig out my old Rumor and just go back to voice and text. I would probably just use my Pre as a WiFi device. I may not use tons of data, but I like knowing I'm free to do with it what I want, if I do randomly decide to sit there all afternoon and watch YouTube videos one day.
As for cable, I have trouble living without internet connection. Tv I can live without, we don't even have a tv. But no internet, I'm reasonbly certain, would stop my heart from beating.
I agree that there should be some difference between "power users" (for lack of a better term), and the every day mild-moderate usage people. As much as I don't want to pay more for what I'm doing, it is fair that I should pay more for using 3 times as much as someone else is using. Defining cost per unit seems like the biggest challenge, to me, as well as convincing people its worth that cost per unit.
+1. Cellphones are NOT a neccesity....
SMARTPHONES aren't even a neccesity!
Especially with the advent of the netbook...:)
Agreed, they are NOT a necessity. However, for those of us that use them so much, and for as long as we have, it's hard adapting to not having them right at our fingers tips wherever we happen to be.
I did it once, though. I ditched my cell phone for a good 6 months to a year, and I kept catching myself reaching for it when it wasn't there. But after a while, I got used to not having it, and kind of liked not getting asked dumb questions 24 hours a day via text message.
Thankfully (in a weird way), since I've had my Pre, people don't text me that much. Or at least, the people that bother me don't really text me anymore. But I am right back to checking it every few minutes to see if I missed anything, almost regardless of where I am. And that is a bit sad.
My cell is a neccesity. I need it for work and my home life. I dont have a home phone and rely on my cell for all communication. Netbooks are a waste of time and a fad. You cant do any work on them. The future is in a small tablet that has the power of a full Laptop computer. It will be your computer, phone, ect.
Yea, I had forgotten about the lack of homephone point. I live back at home now, and my mom has a house phone, but prior to that I hadn't had a home phone for a good 3 years.
But what I mean by not a necessity, is that there are things like home phones, and answering machines, and desktop/laptop PCs, wireless hotspots, and so on. And if ALL else fails, someone near you must have a cell phone. You honestly can't go very far without encountering some sort of communication device.
This is an example of how capitalism lures people in! Its tragic really...that 12-15 years ago we didnt even have cell phones...but now you cant live without them...Its how true capitalism works....and addictions for that matter...lures you in until you are hooked and then...WAM....cant live without em. The truth is you could....and you would if you had to...going back to the pager, or a regular cellphone that has no data.
The only thing that is TRULY a necessity is food and water...
But you know that...:)
This is absolutely true. I remember days before having a computer. We had a tv, and a Nintendo and a VCR, and that was basically it. I entertained myself with Legos, and GI Joes, and played outside.
Now, I'm completely addicted to World of Warcraft, Facebook, my Palm Pre, and (used to be addicted to) StumbleUpon. Is my life genuinely improved due to all these new elements? Hard to say. At least back when I was a kid, I had no idea my life was bad if it was. Now I get status updates every day reading about the stuff people do, and watching YouTube videos of people doing fun, crazy things that I always wanted to do, and would never actually get around to, or be able to afford to do. All my friends, new and old, are suddenly within reach, and they may have scattered around the country over the years, but in a moment I can strike up a conversation on Facebook or by text.
So, as a consumer, I carry the financial burden off all these addictions that may or may not really be making my life better. Granted, I enjoy them, or I wouldn't use/pay for them. But like you said, the only thing that is truly a necessity is food and water. As a result, at the end of the day, even money won't make your heart beat.
If im ever lost in the jungle or homeless, then yes food and water are all I need. But since I have a job, I buy what ever I want and use it.
If you realy break it down, its all make believe anyway. I guess I could break out my old 19'' BW TV and tell the kids to suck it up. They dont need that 52' LED TV, but then my Superbowl Party would suck.
I hope your old 19" TV is not Analog ;)
Yowser!!! You have a 52 foot LED TV? Where do you live, Cowboys Stadium???? ;-)
Netbook? I got a free Compaq netbook from Verizon FiOS and it sucks. My Pre is faster at booting and surfing. With the power of these little smartphone/mini-computers, the netbook's days are numbered. People will do small things, games, surfing on handheld, and word processingand bigger tasks on Laptop or desktop. I think the Netbook is gonna die off real quick.
Take it back!
My netbook is the best purchase I've ever made. It's light, it gets things done, and the battery lasts me a full day! I use it for note taking.
+1 on the "I hate metering comment".
If they do go this route, they need to make it really easy to see how many minutes/MB you are using. It needs to be present within 1 or 2 clicks, or better yet show up as an icon like a battery. The icon shows what % you are and if you click on it, it shows exact data usage stats.
Everyone check their Sprint bills right now and post your average data usage since the Beginning of October (sounds like a good enough month )
Me...I use on average...2GB of data. I never knew till I read this article and went and checked my data usage..its kinda crazy that my PRE eats up that much data...of course its my doin, but for the most part its downloading Preware apps and the app store and surfing the web...
Interesting...
So whats has your average data usage been since October???
I just did the same thing and Sprint says I've been using about 2.9 GB / month for Oct - Jan bills. For me, I download 2-4 podcasts ranging from 12-30GB each every day right now, but I haven't set Dr Podder to explicitly only dl over wifi. I could do that and save a bunch of GBs. Email, web browsing, and Preware updates aren't going to add up very much, it's downloading media, large attachments, and streaming that will get someone to the 5+GB/month range
3.2
Honestly I'm using less than 1Gb a month. I do use my phone a lot but I am usually in a place where there is wifi. I use my phone a lot between my classes at school which sometimes I have a 2 hour or more gap, but I have wifi there so it doesn't matter. I usually have access to a computer where ever I'm at so I just use that. But if it came down to the companies just jacking up the prices I would say F*** Off and bust out my old LG Fusic!!!!! lol
i use about 5 to 7gb a month and has never been charged for extra data.... o ya cause i have sprint!!!, and really have unlimited data...fuck ya now im tethering to my computer (for free) cause im sprint again so i guess ill use about the same cause i wont us the phone as much... i feel sorry for derek and his verizon followers.....
7.1 gig average, 8.5 gig max used. No additional charges so far.
My phone has almost replaced my netbook, except that its easier to compose emails and run MS office on my 'book.
Seeing as how docs to go isnt on the Pre yet, and the small keyboard its hard to type out 1000+ word emails on without getting a cramp!
I don't know this, so excuse the stupid question. If you surf the web or watch youtube on wifi then does that use your 5gb data or no?
As far as I know, the answer is no. It could theoretically split between them if for some mysterious reason the 3G is faster than the WiFi you are connected to is. If there's any truth to that statement, I don't honestly know, and maybe someone can tell me one way or the other.
Wifi does not log as using your 3G. It's through a separate ISP. That why VZ made Palm put it on the Pixi. To cut down on data usage.
Actually T-MO is losing subs just like Sprint...they lost 143K post paid subs last Quarter...77k loss if you include what was added by Pre Paid...
So i would fix that little gab at sprint being the only loser. T-Mobile is now company
I would love to know the losses they felt from the sidewinder debacle!
If the rates were reasonable and the services became better as a result of the increase in price then I would be ok with it. The problem is you can
Something that I would want to see taken into account in any restructuring of the data pricing plans would be growth of the limits. I think the pricing as outlined in the editorial is fair today but a year from now those prices will not be as reasonable, the cost to supply the same level of bandwidth is likely to go down so those savings should be passed on in some form.
Our data usage has evolved, the plans need to evolve along with the usage, and most importantly the networks need to evolve too.
Rewarding customers is not a part of any profit-driven corporate business model, so long as rewarding doesn
+1 VERY good comment....elite like...You should be a columnist..:)
Thanks
Additional thoughts
With this plan customers would pay no more than they are now, though AT&Sprizon-Mobile could stand to reap the benefits of frugal customers opting for the 1 GB plan and grossly exceeding their data usage. If the hypothetical subscriber on the hypothetical plan were to use just 1.8 GB in a month (that
this may be a stupid question, but would that exempt data downloaded over wi-fi (ie at home or office)? Can the phone tell the difference? If so, do your heavy downloading on wifi, more modest on 3G, right? Otherwise the editorial is good and raised interesting topics.
The phone isn't the thing that reports how much bandwidth you use. That is metered at the service provider. They do this, for no small reason: they don't want you to be able to hack into your phone and tinker with what it's reporting.
The offshoot of this is that they don't have to worry about determining how much b/w was used on their service and how much was used on Wifi. They don't measure the usage on wifi, only on their service.
I say the hell with data lol I had a G1 and an iPhone on tmobile with no data plan and had no problem using the phone as I did with the data plan. Its called wifi people lol. I can see why alot of business people need data on the go but for me I would just sync, push, pull, send and retrieve everything I needed to when I was near wifi and look at it when I wasn't. It made me realize that there are so many places with wifi. My college, work, home, friend's home, stores, mall, downtown in most places, oh and the neighbors...hehe. It might not work to say not have data at all for most people but if we become a little more dependent on wifi we can lighten the load on carrier networks and stop there bitching.
I have to wonder...on average...how much data the I-Phone user eats up on average...
and its been around for years now...
This cant be THAT new of a development...
I dont believe that any of the cell phones companies are in danger of their systems breaking down by the added data usage. I just dont think its affecting them as bad as everyone is making it out to be...IMHO of course
It came out last year that the average iPhone user uses 400MB a month and AT&T cried bloody murder over that. And Derek things they're going to charge $10 for a gig? Yeah, no.
ya he does have some weird ideas about everything and he does not like sprint for some reason, maybe its cause we have real unlimited data??
Those plans are completely unrealistic. These companies aren't comparing smartphone users to each other where one used 1GB and another used 5GB, they're comparing them to everyone's grandma who is still on a flip phone and doesn't even USE data. $10 for 1GB, never happening. That's a $30 plan, bare minimum. I pull around half a gig a month and as far as Verizon and AT&T are concerned, that's heavy usage. Further, I hate the a la carting of data especially when the data plan is required. Just make it one whole bill.
Im curious as to where on the sprint site it limits to 5gg. The only thing i could find was, "Data Usage Limitation (Mobile Broadband Cards, USB Modems, Embedded Modems and Phone-As-Modem): The amount of data transmitted over our network is measured in kilobytes (KB), megabytes (MB) or gigabytes (GB). Sprint reserves the right to limit throughput speeds or amount of data transferred; and to deny, terminate, modify, disconnect or suspend service if usage either exceeds (a.) 5GB/month in total, unless specified otherwise or (b.) 300MB/month while off-network roaming. 1024KB equal 1MB. 1024MB equal 1GB."
so it should have nothing to do with how much data i use on my palm, unless i use it as Phone-As-Modem, which is not included in the everything plan
The phone (Pre) has no limit
Showing my age...
Back in the days of AOL, CompuServe and Prodigy, Prodigy grew quickly because they offered unlimited internet with no per second charges. When they changed, and started charging by the minute they didn't last.
My Sprint data card has no limit (confirmed with Customer Retention). I was thinking about switching to a mi-fi but she recommended not switching because of the 5GB limit. So...I am without mi-fi.
As technology changes and we depend more and more on bandwith, companies need to change. Even though I haven't gone over 5GB, I don't want the limit; Especially with Flash coming and watching TV on Hulu.
They can handle this the same way they handle voice minutes. The more you use the more you pay, but unlimited is unlimited. I already have a 3,000 minute plan, with 5 lines and a data card. I am willing to pay for a big plan but unlimited data is very important.
Yeah you all want to see data usage climb even more...wait until flash hits! Streamable media and online gaming...yeah!
The cellular companies are just being greedy. I pay $19.99 /mo for 6Mbit cable and there is no cap that I'm aware of. I realize we're talking cable vs wireless, but it's all data. Sprint has the right idea. If AT&T or Verizon want to keep up, they're going to have to pony up.
Derek, in your last paragraph you stated, "Could this put the hurt into some subscriber
The article is misinforming about "Sprint, T-Mobile, Verizon, and AT&T all cap their so-called
yes it is..... sprint has no limit so SPRINT customers dont worry.... derek is just sore from verizon fucking him all the time
Great article. Well thought out. I'm willing to buy into this pricing structure.
You are both correct and wrong. At this point VZ and ATT have a hold on the market. They are trying to dictate the future of the system, so in this you are correct.
However, if we look at the evolution of the internet, it shows us were this is probably all headed. At first the internet had limits and charges for useage, then some small companies went with unlimited plans. Word of mouth eventualy got around and people started switching services.
What the cell phone companies have keeping their power is the phones. As long as you can control the devices, they can continue to make thes demands. What we as comsumers must do is fight exclusive phones. When you finally buy a phone, then pic your service, then the market will be fair for both consumers and the companies.
Sprint is realy leading the way forcing the 4G network. Wich by the way does not have the 5G limmit. If they can hang in long enough and get more diverse selection of devices and phones, they could force the market to follow.
+1 I will by into this statement...It makes good sense and also states the one thing that should really run capitalism...the customer! The customer should be the driving force behind any decision the company makes because without the customer...the company is dead
How can I tell how much data I'm currently using?
It should say on your bill. On Sprint it is listed with the summary for each phone line.
To see how much data you have used without waiting until your bill arrives, you can register with Sprint.com.
Then go to this URL: https://manage.sprintpcs.com/Manage/myportal/
edit: Just saw previous post with info about how to do it from phone. The url I gave works better from a computer.
You can also go to the Sprint icon on the application screen or the bookmark in the browser. Once that opens up you click on the categories tab, then "My Acct". Click on "My Sprint" and it will have all your billing data.
edit: You will have to register from your phone prior to being able to see your information. It is a small pain but only takes a few minutes. It is a good way to see your current usage at anytime though.
Im pretty sure the 5gb limit is only for broadband plans on each carrier, all of them say unlimited data for their cell phone plans i think this article is misleading, it sure made me think if you used more than 5gb of data on your cell phone you would pay overage charges but i don't see that anywhere on any of the 4 websites
BTW
Sprint is forecast to have $1.5 billion in Revenues and $95 million in NET profit for 2009
In 2010 they are expected to have almost $1.7 Billion in total revenue and have over $200 million in NET profit.
And Sprint is considered one of those "2nd tier providers struggling to gain market share and profit"...
Derek, you are an idiot
ok omatus...chill on the name calling. Derek is entitled to his opinion. It was a good article...it got a lot of people thinking. I would appreciate it if you thought about what you are going to say BEFORE you say it and think about other people.
I think we all would appreciate it if the people writing the editorials get the facts right. If you get basic facts wrong, well, that's inviting derision.
Case in point:
"I can see Russia from my house!"
"You're a moron."
lets take a moment to consider what you just said...you are implying that we should get the facts straight before writing an article about what cell phone companies "might" do or what cell phone companies "could" do? Really? Alright then...I want you to do me a favor and get the facts straight about the outcome of the health care plan obama suggests....or why dont you get the facts straight about how we should fight global warming....COMON...get the facts straight man!!!! you know what...YOU CANT BECAUSE IT WOULD JUST BE AN OPINION! just like Derek is stating his OPINION!
This article is meant to stimulate our minds as to a POSSIBLE outcome that "a cellphone company" MIGHT take...and get us thinking about how we might handle that.
@darkheart777 Flawless logic.
@brendilon Concede defeat and move on. Name callers always lose even if their argument is better (which is definitely NOT the case here)
I have no beef with his theories or opinions. I have a problem with quoting 5gb as the established, FACTUAL limit when other subscribers have clearly been told otherwise. I personally have been quoted different limits by Sprint depending on who you talk to.
As for his theory, I don't see it ever happening. Pay for play internet died a gruesome death for home PC use. I could see one of the cell companies try it, and might even continue to offer it as an option, but most consumers won't go for it. Once the public got used to flat rate, unlimited internet access, there was no turning back.
She never said she can see Russia from her house. She said you can see Russia from Alaska. It is amazing how left wingers can distort facts and all of a sudden their lies are fact. Amazing. - Look up the Charles Gibson interview on YouTube for the truth.
It was a joke. Chill Neocon.
Derek is entitled to his opinion, and so are you and hey...so am I. My opinion is that he's an idiot for implying that we should pay more. And what is the difference between opining that someone is an idiot and opining that someone speaks before they think? Nothing, in my opinion.
BTW, I did think about what I wrote and I still think hold those opinions. Although I should probably state that my idiot comment is within the scope of his article, he might actually be quite an intelligent person, but regarding his opinions in this article, I opine, that he is an idiot.
Also, I agree with you, it was a good article. It got me thinking, and one of the things that I concluded was that he's an idiot.
BTW part 2. I did think about other people, I though about all the people who read this article and thought, "Derek wants us to pay more? What an idiot."
Yes, but you don't have to act like a classless idiot in the process. We all say, and do, some idiotic things. That doesn't make us idiots; it means we are ACTING like one. As a teacher, I would never call you (or your child) stupid; I very well might tell you that you are acting stupidly. There IS a difference.
He may be a classless idiot, but you've gotta admit that was kind of funny.
It's nice to know that someone got the humor.
As a teacher you should know what a domain is. And saying that someone is an idiot on a certain domain even if that domain is understood is also very different. Or have you not heard someone say, "when it comes to math, I'm dumb." That does not mean they are dumb, but that in the math domain, they are dumb.
Since I don't know Derek, the context is this article. And when it comes to this article, I opine that he's an idiot.
Just like you opined that when it comes to my actions in my writing, I'm a classless idiot. Of course, I could be a classless idiot, but then again, it's only my actions you're judging.
Sorry, I clearly stated "acting like", not being one. As intelligent as you sound, I am surprised you still don't get that one. The sad part of all of this is, I AGREE with your entire viewpoint, OTHER THAN THE NAME CALLING!
I think this would really be killing the goose that layed the golden egg. Yes, smartphone customers are the biggest consumers of data, but I would wager, no, I don't know, that they are the loyalest and most profitable. I joined Sprint precisely because they have the most affordable data plans. I love the pre, but I joined because of the plan. Personally, I have a 3 line everything data plan with 3 lines. Does this mean I am entitled to 15 GB? I have personally used 0.5, 2.5, 3.0, 7.2, and 6.0 GB since joining. (I stream music, a lot.) No one else uses more than 500MB.
My family typically uses 200-300 minutes out of my 1500. We also use 1000-2000 txt messages. I cannot believe that they are making less than $100 dollars profit out of my 150+ a month.
I would quit f my usage was metered at 5GB total. Metering at an inadequate level is a an emotional deal breaker.
Here's the thing with tethering:
Most people would need it RARELY. If I have wifi available, or am on my home network, why on earth would I want to connect through my phone??? Does not make sense.
With that said, am I willing to pay $30 a month for the convenience? Hell no.
the problem with the telcos, and this article, is the assumption that tethering is something people would use as their primary connection to the Internet. That's ridiculous.
I think one of the big complaints about mobile providers is how much they nickel and dime you and you have to pay for everything separately. I love the fact that I can get unlimited anything even if that's not technically accurate (it should be). I understand the fairness issue, and I do think some kind of tiered system is probably the best solution. In general I love the subscription model. I like it fro Netflix instant watch (which really only has one tier although the disc rental has several), I like it for my Safari Books Online Account, Pandora (again only one tier), for Evernote (free and paid tiers), etc. The cable/satellite/FIOS providers have similar tiered systems ("bundles"? ) although not having subscribed to any of these in years, it's hard to say. I think it's fine to have a minimal data usage tier (say 500MB), a regular tier of 2GB, and a super tier of 5GB. At least right now. The whole problem is that with all you can do on a smartphone, these will necessarily look smaller and smaller as time goes on. Who knows, with 4G networks coming, we could see streaming HD video, which would blow through 5GB in what? 20 minutes? So what do you do, do you count some things towards your total but not others? That just makes it all the more complicated. I say create three tiers for now, but that bottom tier will not go very far with a smartphone. Maybe there needs to be a non-smartphone tier of 500MB and smartphone tiers of 1GB, 3GB, and 6GB. These would go up each year at a slow pace, so maybe in a year it would be 1.5GB, 4GB, and 7GB, then in 2012 it would be 2.5GB, 6GB, and 9GB, or whatever. The addition of new cell towers is a one time investment and theoretically provides added revenue over an extended time with minimal maintenance costs. So as soon as the carrier recoups its initial costs and then makes a bit on top of that, it should then push data rates up a bit. Of course it would also need to add new capabilities that would entice users to use that bandwidth more.
The way I see it basically is that the carriers should WANT its users to use more bandwidth, because that will allow them to offer more bandwidth at higher costs. But at the very least, everyone's right in that they should stop calling it unlimited data. They can call it anything else but just not unlimited because that's not what it is, and it's basically false advertising.
I dont know if anyone has mentioned this yet, but a data meter integrated into the phone OS that can be easily monitored would go a long way into getting people to adopt a metered plan. I like the idea of unlimited data but have no idea if I even come close to using 1gb.. 2gb? 3gb? no idea
What about those of us who can use wifi? I have free wifi at home, work, and most of the places I frequent. I really have no use for data. The thing is I still have to pay for it. How fare is that? My mother who would never use data would like to upgrade to a phone with a bigger screen(she needs it because of her eyes) and a keyboard so she can txt. With Verizon she has to add a data package that she will never use onto her plan. Again how fair is that. I know that people on here will say why get a smart phone if your not going to use the data plan. Thats just it I really dodn't need to because I have free wifi all around me and my mother just wants a better phone. I just don't think it's fair.
Derek,
As always, I love your reporting, but I think you have made some wrong assumptions on this one.
1. ATT and VZW have lowered their prices because of Sprint. While they aren't losing customers to Sprint, Sprint has risen like a skyrocket in the Customer Service polls in the last 2 years. Couple that with the kilelr pricing and readily available discounts, ATT and VZW are hedging against future customer losses to Sprint. All it takes is for about 1500 customers to leave last year saying, "I'm switching to Sprint because they have a cheaper plan for my smartphone" and that will show up on a report to an exec somewhere who says, "We need to do something about this."
2. VZW and Sprint have bandwidth to burn. They are both teir 1 internet backbone providers, and have access to more bandwidth than anyone can possibly imagine. VZW has ridden the higher prices because they could; the demand for their product governed the price. ATT on the other hand, is upgrading and buying more bandwidth for their network because they can. They are looking at Sprint (customer service, great plans, wimax, totally unlimeted 4g, et al.) and saying, "We need to do something about this."
3. Unlimited is the way of the future. Just look at how much more we get for the same money now that we used to. Eventually, the cap will come off. I think Sprint will be the first to get there in a sustainable way.
4. New networks are cheaper than the old ones. Sprint/Clear Wimax towers cover a 10-12 mile radius, whereas CDMA towers cover a 2 mile radius. That means they only have to put up one tower for every 24 of their old ones. Bandwidth is cheaper (especially if you are the one creating it) and computers, routers, switches, are all cheaper than they used to be, use less energy, and need less maintenance.
The bottom line is that all three of these providers can afford to offer more for less. In the case of ATT and VZW right now, it's just a matter of keeping up with Sprint.
Hey man...not that I mean to doubt you...but could you list your sources??? I would love to read up on all of your points
even if it's a guess, it's it's an educated one .