A power struggle is brewing between consumers and mobile internet carriers. There is no denying that we are living in the post PC era, people are increasingly turning to their smart phones and tablets to access the internet. As this shift in pattern broadens the major US cellular providers have have all moved in some form to eliminate unlimited data plans.
With the advent of the iPhone and its myriad web of connected data hungry applications, AT&T provided early adopters with an unlimited data plan. Back in June 2007, Youtube was still growing in influence and it was becoming clear that video was the future of the web. Fast forward today and HD video is now the standard on sites like Vimeo, Youtube, Hulu and Netflix. People are now accustomed to watching movies on their phones, and video chatting with friends.
The rise of online video as you can imaging has brought with it major bandwidth requirements that tax the infrastructure of mobile carriers. In turn they’ve decided to renege on the service plans people have grown dependent on.
In June 2010, AT&T kicked off the downgrades with the cancellation of it’s $30 a month unlimited plan, replacing it with $25 a month for 2GB. (Customers who had the unlimited plans prior to the change were grandfathered in)
The AT&T merger with TMobile earlier this year also brought an end to unlimited data plans on that carrier.
In July 2011 Verizon announced it would be ending unlimited data plans and switching to a tiered system. The plans as of this writing are: $30 = 2GB per month, $50 = 5GB per month, and $80 = 10GB per month.
Virgin Mobile (a Sprint subsidiary) has also announced that starting October 2011, it will place bandwidth caps on users who abuse it’s unlimited data plans. Abuse being the operative word, anyone who goes over 2.5 GB will see their service slowed down until the start of the next billing cycle.
Sprint is the only remaining US carrier to offer unlimited data plans.
In an industry dominated by fierce competition, cellular companies are moving in unison to tighten the reigns around consumer data usage. As a defense they will argue that most consumers today don’t go over 2GB a month. However, that logic is short sighted. The major carriers know that mobile video usage is about to explode, streaming massive amounts of data through mobiles apps is about to become the norm. By restructuring their pricing plans now, they’ve guaranteed themselves a windfall once consumer appetites grow addicted to video conferencing and watching movies on the go.
This is when you’ll be forced to either upgrade to the $50-$80 a month plan or face equally punitive overage charges. In the near future we will be seeing the return of the $200 dollar cellphone bill. This scenario is a loss for their customers and a win for their shareholders.
What do you think about the new data plan prices, are they fair to consumers?
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