Will the Carriers Kill the Mobile Revolution?
Back when dinosaurs roamed the earth and I rented a car for the first time, I drove with one eye on the odometer because I was paying by the mile. Those days are long gone, but with all-you-can-eat data plans rapidly disappearing, more and more of us are downloading with one eye on the data meter.
Consider a typical metered plan: An AT&T tablet user can use up to 250MB a month for $14.99 (see the plan for yourself). Go over your 250MB and you'll pay another $14.99 for the next 250MB, which bring you to $30. However, a recent survey by Nielsen found that the typical user of an Android device consumed 582MB per month, for a total of $45 a month on that plan (to be fair, AT&T does offer a 2GB plan for $25). iOS users averaged somewhat less -- 492MB per month -- and unlike with voice plans, unused data allowances cannot be rolled over.
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And I've just mentioned the easy-to-understand part of the plan. It turns out that there are huge gotchas hidden in the fine print that vary the actual charges based on the device you use. For example, AT&T and Verizon Wireless expect smartphone users who connect to corporate email to pay $15 more per month for the same amount of data.
Sure, carriers have a right to recover costs, and there certainly are data hogs among us who should pay for their gargantuan appetites. But charges keep going up. Verizon Wireless CFO Fran Shammo said in May that his company will ditch its $30 unlimited data plan this summer. Can Sprint be far behind?
If the telecommunications industry were competitive, the market would keep the carriers from raising prices even faster. But it isn't competitive now; in most cities there are few choices for serious business users. If AT&T succeeds in swallowing T-Mobile, and Verizon Wireless advances in its plan to smash the smaller, regional carriers, the market will be even less competitive and the mobile revolution will slow to dial-up speeds.
NEXT: Verizon's Ugly Plot to Squeeze out Small Carriers
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