Verizon CTO says metered data pricing necessary; ‘bandwidth hogs’ should pay more

January Clearance Blowout ends 1/14“The technology chief of Verizon Communications Inc. says wireless companies will eventually have to change how they bill customers, charging them for how much ‘bandwidth’ they use to prevent networks from getting clogged up,” Jeffry Bartash reports for MarketWatch.

MacDailyNews Take: Layin’ the groundwork for something? wink

Bartash continues, “Chief Technology Officer Dick Lynch said current data plans, which allow unlimited Internet access for a flat monthly fee, encourage overuse of wireless networks, mainly by a small number of ‘bandwidth hogs,’ or individuals who send and receive lots of large files.”

“Lynch said wireless companies will be able to handle increasing Internet usage over the next few years by upgrading to the next generation of wireless technology. But in the longer run, he said carriers will need additional spectrum and new ways of billing that encourage more efficient use of wireless airwaves,” Bartash reports. “‘We will end up billing differently in the future,’ said Lynch, repeating his long-held view that carriers should charge on a metered basis just like water and power companies.”

Full article here.

[Thanks to MacDailyNews Reader “Lynn W.” for the heads up.]

65 Comments

  1. People can buy their own T1’s for less than that $400 a month stuff. As far as metered bandwidth and video on demand via the internet which everyone thinks is the next big thing.. yeah right. Start charging for the downloads and all of a sudden those 30GB BluRay movies sitting on the shelf at Frys looks a LOT more attractive.

  2. Talk is cheap. If Verizon gets the iPhone, Apple will have a lot to say about it’s rate plan. Ask AT&T;. Otherwise T-Mobile or perhaps Apple can save Nextel
    from the abyss. Whoever sells and services iPhones will improve, AT&T;is just a slow learner.

  3. You have an amount established for unlimited use. If you use less, you should pay less. Simple.

    Too bad carriers want to talk about bandwidth as if it was something where the “unlimited” plan is the floor and some to-be-determined cap and charge is the ceiling.

    Horseshit. You people have been making money on the 95% of the people who use almost nothing. The rate for “unlimited” is the ceiling, and we scale down from there. If not, GFY.

  4. I agree that the “hogs” should pay more. But only if the customers who voluntarily use less bandwidth can have a plan that costs less than the current “unlimited” plans.

  5. SO let’s see … they sell you a highspeed service based on bandwidth (up to 5Mbps) and then call you a bandwidth hog if you actually use it? Makes perfect sense! Clearly these “hogs” should be punished as they most certainly must be PIRATING and ultimately costing American Telco workers their jobs. Oh the travesty!!

    In the end it’s all about one thing: separating you the customer from the freebies you now enjoy so greedy companies can offer those same features later at jacked up rates and line their pockets. Every home one earth today *should* have free communication to anywhere on the planet as part of their pre-paid internet package, but free doesn’t make enough money.

  6. I just got back from Germany where you can buy a pay-as-you-go USB data modem for $45, with daily rates costing around $5, or $30 a month. Verizon offers the same thing for $130 for the modem, and $15 a day. What a difference! Germany also offers a much greater range of tiers for customers than here. It all really brought home to me just how much the US cellular providers are ripping us off here, it’s really too bad we can’t do anything about it. Instead of paying $40 or even $50 for Internet, why couldn’t we have a rate for, say, $20 for 5GB? This would solve the “hogs” problem, and would make the prices more reasonable for most of us.

  7. So we get charged for text messages – which run on the control channel and cost the networks nothing – and now we need metered data pricing too?

    Why don’t networks use the money they’re gouging from consumers text-messaging to subsidise the data “costs” …?

  8. @Brau, leodavinci, Powers, Gabriel

    “In 2008 and through Q3 of 2009, AT&T;invested approximately $19 billion toward wireless…”

    That’s B for billion not million.
    Then after they do that, look at the network analysis to see how much extra bandwidth you have and see every bit get used up right away.
    That has got to be a bit overwhelming.

    No one. Absolutely no one had any idea how much of an explosion the iPhone was going to be. Everyone thought Apple was insane predicting they would sell 8 million iPhones by a certain date. They totally crushed it. Now on the 3rd version, the iPhone is still growing exponentially.
    Once again, all the experts and competitors said it would not happen.

    You have to put yourself in the position of an engineer trying to guess how much money to ask from higher ups to double wireless capacity in certain areas. How quickly will it grow?

    Apparently all the experts were wrong.

    Plus many users probably have no idea the bandwidth difference of ethernet vs. 3G. Your work network can easliy be 1000baseT, that’s Gigabit ethernet, or 1,000Mbit. The iPhone 3G is 3.6Mbit at best. That means your work network is 277 times faster moving data and video from servers to workstation.
    The 3G wireless is not as fast as a 20 year old network standard of 10BaseT.

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.