AT&T has reportedly started throttling its heaviest data users (to be exact, the top 5% of its data users) to, well, 2G speeds. According to CultofMac, AT&T has been alerting customers of their data throttling move by way of a particularly terse text message, which says “Your data usage is among the top 5 percent of users. Data speeds for the rest of your current bill cycle may be reduced.” And is punishing those top 5 percent of users with a woefully plodding, snail-moving 2G speed.
T-Mobile has done this for a long time -- but they've always been honest about it. You can buy 2Gb, 5Gb or 10Gb data plans, but in fact they're all unlimited -- they throttle you when you exceed the caps to "2g" speeds (actually about EDGE speed, or ~150kbps)
The latter is sufficient to browse the web, use things like Google Navigation and similar without much disruption. What it won't let you do is stream realtime audio or video.
Sprint, for its part, claims to have the only truly-unlimited data service. We'll see how long that holds up -- one of the ways they do it is by offering service at a materially-lower bitrate. As an example their prepaid Virgin service has no actual cap but it doesn't really need one in comparison -- data performance over EVDO-A is typically in the 1.5-2mbps range where T-Mobile's HSPA+ can reach a theoretical 42Mbps and often does reach 10Mbps or more here in actual practice. Even their older handsets without "HSPA+" capability can and do reach 3-4mbps regularly. That's much faster and as such if you're a data pig you rack up the bits (and thus cost for the carrier) at 5x the rate you would on Sprint. AT&T and Verizon have similar "4g" performance levels available on some of their newer hardware.
The problem that the screechers who claim they're "due" unlimited data fail to understand is that at the wholesale level wireless data costs ~$10/Gb to buy. That's because the wholesale level requires both the over-the-air equipment which is rather expensive per bit-time moved and also the backhaul connections to make it all work. This hardware and provisioning is not cheap and there is no other service running on it that covers some of the fixed costs (unlike Cable TV, which has the basic cable customer paying for the actual wire that goes around the neighborhood which is one of their major expenses.)
AT&T, Verizon and others often build their own rather than buy wholesale from someone else, but the fact remains that this is pretty close to the cost of installation -- if it wasn't then companies like Clearwire couldn't exist at all, but they can and do. In fact it can be argued that the current pricing is too low, given how difficult the general business environment is for these firms at the present time.
There's no free lunch available in these cases; landline distribution of data is much less expensive in an urban or heavy suburban area than wireless. In rural areas wireless may win in the price war but only because the cost of providing service on wired plant is so much higher due to the lower density of connections. As a result wire carriers (e.g. cable and fiber) tend not to offer service at all in rural zones as there's simply no way to design a profitable network in those areas using wired technologies.
I had moved to Virgin for a while and recently went back to T-Mobile due to the fact that they were running a "small business" promotion with unlimited voice, text and 5Gb of 4g data (uncapped over that but at 150kbps) for $45/month -- with no handset subsidy however, so you "bring your own" or buy whatever you want at full price from whoever you wish. That beat Virgin's plan and their coverage was comparable or better in the areas where I use the phone, so they "won", especially when one starts to consider the higher data speeds.
Then again I'm not one of those people who runs over the 5Gb cap; were I to do be so, and have "gotten used to" the idea that I could watch Netflix over my "4g" connection, I might be rather upset about now. But should I be?
Not really. Look up above again -- that $10/Gb cost means that for every hour of Netflix I watch I'm running about a gigabyte of data. In the mobile paradigm this means that someone is eating $10 for every single hour of such video I watch. If I'm paying $30 or $40 for my data plan then I'm buying at wholesale prices, with no profit for the carrier, about 3-4 hours of that a month -- and if I use more, they lose -- big.
Unsustainable business models can't be sustained folks. I'm sure the screech-monkeys will be out in force on this, but the facts are what they are, just as is true in other areas of our economy that are heavily distorted by half-truths and outright lies. Just as in the Medical System where you cannot have everyone get $500,000 worth of treatment when they pay $100,000 into the system over their lifetime, you also cannot have everyone pay $30 for data but consume $100 worth of it.
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