Verizon Hints At Scrapping Unlimited Data Plans 319
BusinessWeek reports that Verizon may be preparing to follow AT&T's example by eliminating unlimited data plans later this year. Quoting:
"'We will probably need to change the design of our pricing where it will not be totally unlimited, flat rate,' John Killian, chief financial officer of Verizon Communications Inc., the wireless unit’s parent, said in an interview at Bloomberg’s headquarters in New York today. The company anticipates 'explosions in data traffic' over wireless networks as new phones on 4G networks incorporate data-heavy applications, such as video downloads, he said. Verizon is working to keep its network running smoothly as more of its customers switch to smartphones that connect to the Internet. ... 'The more bandwidth that you make available, the faster it will be consumed,' said Craig Moffett, analyst at Sanford C. Bernstein & Co. in New York. 'From Verizon’s perspective, the last thing you want is for another generation of consumers to be conditioned to the idea that data is always going to be uncapped.'"
Consumers are getting mixed messages (Score:3, Interesting)
Two comments (Score:5, Interesting)
First: Contrast the behavior of big companies like Verizon who consistenly reduce their level of service with that of companies like Linode, who consistently increase the level of service offered to their customers for no additional charge: http://blog.linode.com/2010/06/16/linode-turns-7-big-ram-increase [linode.com]. THAT is how you ensure customer loyalty. Sometimes squeezing every last penny out of customers isn't the best way to do business.
Second: When I purchased my smartphone, I didn't like being forced to purchase the "unlimited" plan for $30/month. Since the phone has WiFi and I'm usually near a WiFi access point, I was willing to rely on that to save some money. Instead I had to drop a second phone from the plan so my monthly bill didn't increase too much. If their new data plans include limitied but reasonable data allowances for a lower cost, I'm actually ok with that. The real problem is that it seems many (most?) current smartphones don't easily allow 3G to be disabled until needed. Or deprioritized with respect to WiFi - eg. Use WiFi preferentially when in range, only fall back to 3G if necessary and only for the apps configured to do so. (Note I say *easily* - I know data can be turned off but it's a PITA. The normal state is "data always on".) Given that these devices are constantly accessing the network, if simply having the phone on with data enabled puts people in danger of incurring overage charges when using the standard plans, they (Verizon) did it wrong. The new plans should take "normal" use into account, be less expensive than current plans, and provide reasonable options for heavy data users. Then this move might actually be a good one, benefiting everyone.
Re:Why not raise the price instead? (Score:4, Interesting)
Re:Yet another excuse to charge more money (Score:3, Interesting)
Around here, you drive around and you see a huge number of satellite dishes popping up. I guess it turns out that people were sick of paying for channels that didn't come in properly on Comcrap. It might be a bit better if you're getting cable through a bulk package as a part of a condo association or similar, but the cable company just doesn't care enough to provide the service that it promises.
Same really goes for cell service. Since for the most part they all suck, there's basically no motivation by any of them to actually improve.
Re:Unlimited already means 5G (Score:5, Interesting)
http://www.intomobile.com/2007/11/03/verizon-wireless-when-we-say-unlimited-data-we-mean-5gb-worth-of-unlimited-data.html [intomobile.com]
While that article is just as good at trolling a subject line as the OP is, the part we care about is this:
And, should you exceed the 5GB/month limit on your “unlimited” plan, Verizon will “reduce throughput speeds of any application that would otherwise exceed such speed to a maximum of approximately 200Kbps” – with actual speeds “subject to change.
It remains functionally unlimited, and the same type of cap pre-5GB applies: connection speed. Just a different speed.
Re:Honest question (Score:1, Interesting)
hey, i have to post anonymously, since i was moderating this discussion. however, i have worked at major ISPs.
anyway, there is no fundamental limit to the capacity that ISPs have for their own networks. or, if there is a limit, we're not even close yet. any one of them can expand their infrastructure, and quite easily, at that. however, it costs a lot of money to do it.
every single one of the big american ISPs, however, doesn't want to actually behave in a capitalist manner: they don't want to really rechannel profits into their systems' infrastructure. they want to take all of the profits, and make themselves wealthy. therefore, the capital of their business never really gets upgraded in the way it should. and everyone suffers.
to sum it up: this is something that is absolutely limited by finance alone. anyone who tells you otherwise is bullshitting either you, or themselves.
as for bottlenecks? packet filtering and inspection, as well as being forced to comply with too many idiotic US government laws. it takes a toll on network performance.
This is about VoIP. (Score:3, Interesting)
Unlimited Data ultimately means that VoIP wins and the entire pricing structure for cell phones is over.
Cellular "minutes", must still be worthwhile or cell carriers are over.
This will be a big hit for mobile internet radio.
This is a load of crap (Score:5, Interesting)
Re:SMS != data (Score:4, Interesting)
SMS messages are squeezed into unused space in control packets that the phones and towers exchange normally even if there's no call happening. So on GSM networks, SMS isn't data and incurs no cost at all to the operator. SMS should be completely free on GSM providers.
I agree that there is little if not zero "tower-to-handset" bandwidth cost for SMS messaging.
However, SMS (and MMS) messaging does depend on all that infrastructure that's in place, and by providing SMS services, the telcos are required to reliably route and deliver the messages around the world. That message handling and routing certainly has a cost, and therefore I believe that providers have a right to fairly pass on a portion of the cost of their infrastructure investments (plus a fair profit) to the users of SMS services.
HOWEVER, I am no apologist here. At least in the USA, providers charge very high fees for text messages. If I send a 15 character text message to my wife, we get charged $0.40. A few pennies may be fair, but far more than $0.39 of that $0.40 is profit. Furthermore, SMS is configured to be parasitic - my friends (and spammers) like to send me text messages without my authorization. That costs me $0.20 every time, and there is no way for me to stop them without giving up my wireless service altogether.
What is even more disturbing is that all the telcos in the US have generally increased their SMS rates to a new high. They now charge the same outrageous fee ($0.20 in, $0.20 out), leading me to believe that instead of competing, they are colluding.
In short, telcos have decided (individually or together) not to compete in this area, to the detriment of all telco customers. Laws should be considered to encourage fair and healthy competition in this space, which will encourage healthy SMS industry growth and efficiencies.
Insensitive clods. (Score:2, Interesting)
I don't know what generation they're talking about, since 300 baud was considered a fairly good linespeed when I was in my 20s, and the amount of data you could transmit was limited by the size of the trolley we used to carry all those mag tapes around.
Re:Honest question (Score:5, Interesting)
I work for a big ISP, and bandwidth is not a issue on the backbone, we do more bandwidth in VOD video to the home than internet service will come close to for a long time.
The amount of bandwidth in the last mile has always been the real issue, but for home internet service that problem is getting much better and I would says both cable and dsl services have been able to provide over 100mb services to a house for awhile now, but there is a cost of upgrading equipment, and you will need more equipment (dslams,cmts) since you will be able to put a smaller amount of customers on a device. But these are just money issues, not technical ones, and these companies make lots of money, they are VERY profitable.
This goes for Verison also, it is very cheap for these companies to use several fiber rings around a city to get fairly cheap bandwidth, more bandwidth than they could ever use for cell phone back haul (10 gigabit ethernet between towers) but I would have to assume the bottleneck is the tower to the phone. I do not know much about this equipment works really, I am not sure if this equipment is limited by the amount of connections on the tower or the bandwidth of each connection, but I would assume that this is a issue that can be solved by spending money on more or better equipment.
I have a hard time listening to these companies whine about bandwidth, when they are making a killing, you can not even get attention in a Verison store where I live the demand is so high you get a number like you are at the DMV. The number one highest growing market is cell phone service, these companies know these very well. So having to upgrade equipment should not be a issue, it should be what they do, what they provide us, its a good problem to have!
Now about the unlimited plan thing, for most customers that buy a unlimited plan, it is not about having lots of bandwidth, its about insurance, or piece of mind!
This allows them to let someone play with the phone with out counting pennies, or that little johnny did not get a hold of my phone and run up a big bill by mistake, it lets you play with the phone with out counting minutes, but I guarantee for every 1 person that uses allot of bandwidth, you get 20 that do not use much bandwidth at all but want the unlimited option to make them feel protected from 1 bill that they are not ready for.
I'm all for it (Score:3, Interesting)
in theory
I have Wifi at home, at work, and pretty much everywhere in between. So I barely need data. If there was a very cheap data plan, I'd take it. Right now, I have no data plan at all because it's too expensive for very little utility.
Also, I don't object to heavy users of a scarce commodity (bandwidth) paying more than light users.
That's assuming that telcos are investing sufficiently, and are not sneakily raising prices... but that's another issue, really.
Re:Why is that "collusion"? (Score:5, Interesting)
When one company decides to force a product to become worse but cost the same and then another one follows suit. That's something else.
It may or may not actually involve collusion but it sure doesn't do anything good for the customers.
Why all or nothing? (Score:3, Interesting)
Why just scrap the plans? Why not have a "hard transfer limit", and then pop up a Yes/No dialog on the phone that lets you know you exceeded the limit, and offers you per-minute rates for the remainder of the month.
That's no different than "all you can eat" buffets. Those of us who simply want to get full shouldn't have that taken away just because somebody camped in the restaurant. In fact, that has happened, and I wager most if not all restaurants with "all you can eat" now specify a time period.
Re:Two comments (Score:3, Interesting)
What you are asking for is arguably a very specific feature and something that is probably too complicated for typical end-users. But it is nonetheless quite useful and something that should in fact be available for power users who don't get confused by the fact that they might accidentally disable all data-communications on their device.
On GSM/UMTS devices, you can probably do most of what you want to do by installing APNDroid from the Android market. It allows you to selectively disable non-Wifi data connections. There are a few other applications (e.g. Timeriffic) that are aware of APNDroid and that can be configured to en-/disable data based on other factors (e.g. time of day). I believe there are similar applications that can trigger based on location, but I haven't tried that myself.
Unfortunately, I believe that this option is not really available for CDMA devices such as the Droid. Last I checked, APNDroid only worked on devices that actually use APNs -- and that's a GSM/UMTS technology.
Normally, in a situation like this, I would suggest you look at community-firmware such as the Cyanogen project, as they tend to be quite good about adding a lot of features for power users. But again, I think that won't help you. Last I checked, the Droid was difficult to work with and didn't have much in the way of community-firmware.
Sorry that I can't be of more help. But maybe some of these suggestions will give you an idea on where to look for a solution.
Re:Two comments (Score:3, Interesting)
Especially if we didn't just like Netflix. I feel like I'm taken care of with them in a way I can't say many other companies whose goods and services I buy make me feel. Lose a disc in the mail? No problem, we like you so not only are we going to forget about it, we're going to go ahead and promptly send out the next disc in your queue right away. They even do this if a disc is scratched. That is, if you tell them it's scratched. They just go, okay go ahead and mail that one back to us, but in the meantime we're going to send out another disc right away. They don't even wait for the damaged disc to return to them for evaluation. This is a company that values customer satisfaction over their own stock. Because ultimately my satisfaction is more valuable than a few pieces of their stock.
Then there is a company like Blockbuster Video. I was living for a time in a separate town from my girlfriend. So no Netflix for me. There was however a Blockbuster right next to where I worked. I went there occasionally, mostly because I had long had a membership and it was just easier than signing up for a new place. What can I say I'm lazy in odd ways. Then Blockbuster finally decided to get into the online game and I let a cute girl go ahead and sign me up. I figured I could rent some dvds, rip them that night and return them when I went to work in the morning. I powered through entire series of television shows in days and after two months of membership I canceled and had months worth of entertainment to watch at my leisure. I realize I was still giving money to Blockbuster, but I like to think that with all the processing costs I was at least a small loss for them. In fact I seem to recall them hiking their rates around the time I canceled, probably just due to them not fully appreciating the cost of their program, but I like to think that abusive customers like myself had something to do with that.
Because fuck Blockbuster. After years of exorbitant late fees, charging 1/5 the price of a game for a rental, hawking crap at the register, and finally just flat out pulling late fees off my credit card (this unexpected action cost me an overdraft fee or two in my lean college years!), I have slowly built up an attitude of contempt for these guys. I hope they fail in their bid for online and I hope they die a miserable death. I see the Blockbuster sign and I loathe it. I see the Netflix logo and I feel kind of warm. Sooner or later these businesses will come to understand the value of that.