“Sacconaghi estimates that the average iPhone users consumes 5x-7x as much monthly bandwidth as an average wireless voice subscriber, and more than 2x the amount used by the average 3G smartphone user. He says the average iPhone user consumes 250-350 MB/month including voice, which is above the 200-250 MB entry level data plans Verizon and AT&T offer,” Savitz reports. “He notes that some heavy users gobble 1-5 GB a month; he calculates that some of the heaviest users effectively have a net present value to the carriers of zero.”
Savitz reports, “In Sacconaghi’s view, the situation eventually will trigger usage-based pricing in the U.S.”
Read more in the full article here.
[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]
It’s nice to think that capped data will “destroy the next step in technology” but that’s stupid – how the hell is reducing congestion to make TODAY’s technology work properly somehow going to destroy TOMORROW’s technology? Isn’t it actually the reverse that’s true – not capping data will destroy the current step in technology?
There is a need for a user-pays system for data because that’s the only way to fund the rollout of more capacity.
@Joe says that it’s the “opposite of where the market is going” but as far as I know the US is the only country in the world where data is unlimited – ISPs, wireless, whatever. The rest of the world uses volumetric data billing and it’s apparent that this is likely to happen in the US as well.
Like many others, I don’t really know what the problem with capped bandwidth is. My Australian iPhone has a 1gb plan and I’ve never hit the limit – and I use it on 3g, daily, while commuting. My ISP has shitty caps for the cost – but nobody except my lazy ass is stopping me from changing to one of the many competitors who offer more data at the same price.
qka
Every railroad is subsidize by gov’t. Even if good ol’ USA.
Sackagaweea needs to shut the heck up, At&t;needs to continue to build out their network and pray that steve jobs bumps his head in the shower and does not add another US carrier
@ DogGone: In the USA only the Amtrak passenger railroad gets a government subsidy. The freight carriers have been subsidy free since Reconstruction ended.
i don’t know about the data plan in the US, but here in Malaysia, RM100 per month ($30) gives you $30 worth of calls and just 500MB of data! at RM300 per month ($88), you’ll get 3GB.
julian @ http://no-spamming/
Yeah, and we all know how accurate those analysts have been. Next…
I got my ///GS the week after launch, and I’ve used a total of 222 MB received and 47 MB sent data since then, so I don’t get how anyone (who isn’t using tethering) is using upwards of 5 GB a month. Granted, I have wifi at home, work, coffee shops, and most restaurants, and Seattle offers wifi on the commuter trains and ferries, so it may just be the prevalence of wifi in my world that keeps that number low. Still, anything over a gig a month just seems insane.
And yes, ///GS; I always wanted a //GS, so this makes me feel like I got one better
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If At&t;is greedy, then so are the people who refuse to pay extra when they use many times the average data volume, even though it ruins the experience for everyone. I say At&t;bring their data cap down to a meaningful level, say 500 MB. If those customers change network, so be it. Remember, Apple wants the average consumer, not the geeks.
@ Bill
Re “Bring on the data cap AT&T;. There is this thing called MiFi that other carriers have available. The iPhone and iPod touch work great with. No problem. AT&T;can do everything to lose our business.”
b>MiFi or even Wi-Fi is not free.</b>
You’d think these scoundrels were giving away wireless service to hear them whine.
Honestly, they should put a cap on data and charge overages.
They would eliminate wasteful and unnecessary data transfers and improve network performance.
Tiered Data plans and overage charges would be perfectly acceptable if we knew that AT&T;would be plowing those fees directly into upgrading and expanding their network (4G anyone?)
But, we all know that the majority of those fees would go directly into the pockets of their executives for cooking up yet another way to screw their customers, while reducing service.
It’s the American Way!
IMO, bandwidth caps are a company’s way of building in a switch to destroy their own business. If a competitor comes along and offers true unlimited bandwidth, then BAM!, your customers start to stampede away. Stupid.
What’s so wrong with usage-based pricing? Why should the heaviest users get subsidized by the rest of us? The only people who rightly should be concerned by this are the bandwidth hogs who are getting a free ride and degrading service for everyone else. Of course, the usage-based plan has to be sensible, not like, for example, AT&T;’s international data plan where $24.95 buys you 20MB per month. I used the entire 20MB is a 30 hour trip to Paris and all I did was leave push email on and read the occasional message. The bandwith WASTE on the iPhone is truly amazing.
Blame the device..nice. If they wanted, they could really create a great network to support CURRENT technology– but the telecommunications industry is SO lazy.
Hey ATT & pals: get off your A$$E$, improve your network infrastructure, bring broadband to mobile, embrace the future you pikers!
Do you really think Steve Jobs is going to let ANY carrier limit the value of the iPhone by capping usage? Do you really think he’ll stand by and watch ANY carrier gouge HIS customers and siphon off value could be profit margin for Apple? Me.com (mac.com) and all of those server farm facilities that Apple has been quietly assembling aren’t just idle maneuvering by Apple. I’d bet the farm that Steve has a plan to eliminate cell phone carriers from the picture completely before too long. Think about VOIP combined with WiMax and an iPod Touch/iPhone. 99% of all calls would NOT be through a cell phone carrier. Bye-bye AT&T;, Verizon, Sprint, T-Mobile. I’ll miss you like I miss my ex-wife.
And BTW, I did bet the farm…back when AAPL was $7 a share. The farm’s gotten a lot bigger since then.
G4Dualie says…
“Rationing is the Capitalist way. We live in the land of options and tiered pricing!”
Do you even know what rationing means? Rationing happens in the absence of capitalism! It’s kind of like, basic capitalism vs. socialism. Socialist countries (like the former Soviet Union) were notorious for rationing.
Basically, when the government decides people’s wages and all that, people stop working to “get ahead” and the net result is lower production. Lower production = rationing.
Capitalism allows for market adjustments like the one this story is about (which, based on the overloading of ATandT’s network, it sounds like it’s in order). If the carriers do introduce tiered pricing, that is not “rationing” unless they take away the unlimited option altogether.
All this entitlement really is tiring.
HazMatt
I use a 3G Cell USB device for internet on the road with my MacBook and average about 8-10 GB a month. I get it for flat rate pricing from a hold over deal with Alltel- now part of Verizon. Since I bought the phone and do not have a contract, I’m good. Verizon probably doesn’t like it, but they had to accept existing plans as part of the DoJ approval of their takeover of Alltel.