I got this e-mail from Virgin Mobile this morning. I use Virgin for a pay-as-you-go Mi-Fi, and it's been a great deal, allowing me to buy data only when I need it without a contract. A few months back, they announced new pricing plans, and it included unlimited data -- no 5 GB caps -- for forty bucks. It was such a great option -- again, no contract -- that I recommended it to others looking for a way to get mobile broadband without signing up for a monthly plan or jailbreaking and tethering their phones.
But, as I said, I got this:
Hey Perry,
Okay, what's the problem? Because you aren't going to e-mail me unless there's a problem or you're selling something.
Here at Virgin Mobile, our mission is to deliver an outstanding customer experience. Sometimes that means making difficult choices in order to provide the best possible service to the greatest number of customers.
Uh oh.
To make sure we can keep offering our $40 Unlimited Broadband2Go Plan at such a great price, we're putting a speed limit in place for anyone on that plan who uses over 5GB in a month.
There it is. And the way they're going to do it is this:
-Your data speeds will be limited for the remainder of the monthly plan cycle.
-During this time, you may experience slower page loads and file downloads and lags in streaming media.
-Your data speeds will return to normal as soon as you buy a new Broadband2Go Plan.
And then they note:
Keep in mind, 5GB is A LOT of data. To give you an idea, it's about 250 hours of web browsing or over 500,000(!) emails. So this change shouldn't affect you unless you're a heavy downloader/streamer/etc.
And that's true. For now.
When I've used the Mi-Fi, it's been to cover conventions or when I had to deal with some other stuff that meant I had to work away from the office for a few weeks. In that time, I didn't come that close to 5GB. But that's now.
At CES, the assumption everyone was making, and the thrust of the push for tablets and newer, faster 4G cell phones, was that we're all going to get our video and audio through broadband. They were talking about pushing to reclaim television spectrum for mobile broadband, meaning that some folks would like to see over-the-air TV go away. Radio? To be supplanted by streaming audio. Movies? Oh, you'll stream or download those to your tablet or phone. That's how it's supposed to be, soon.
Yet here's one of the last uncapped data plans getting a cap of sorts; you go over, you slow to a crawl until you pay up. You know about AT&T's 2GB plan, and how Verizon's making noises about that, too. When talking about LTE, the carriers get very quiet when anyone asks about data caps or throttling past a sertain usage level. The carriers are clearly moving towards tiering or capping at precisely the time that consumers are starting to demand Netflix and Hulu on their mobile devices, and the time content providers are ready to give them what they want. And meanwhile, even the recent FCC net neutrality proposals exempt mobile carriers.
This is shaping up to be a problem.
In an ideal world, competition would take care of the situation. Your carrier puts a low cap on data and hits you with overage fees, you move to another carrier. But when they're all doing the same thing or planning to do the same, the market, which is already artificially restricted to four national carriers, a few regionals, and some MVNOs, isn't going to work. Competition in the U.S. mobile marketplace seems to revolve around device exclusivity and coverage claims, not pricing and differences in data allowances.
Yet I understand why this is happening. The carriers can see a few heavy downloaders ruining service to the other users. They want to manage their networks. I get that. But if we're moving at a quickening pace to getting our TV and radio and movies over mobile carriers' networks, and we're now going to have to watch our usage lest we go over the limit and incur a massive bill, that can't be good for the growth of video and audio over mobile broadband.
(I know, use Wi-Fi. Maybe there's free Wi-Fi everywhere YOU go, but tell that to someone who uses their tablet to ease their long bus commute, or wants to listen to streaming audio while jogging in the neighborhood)
So, which is it going to be? Cheap, open mobile broadband that encourages media consumption, or capped or throttled data that makes using your devices either expensive or unpalatable? They're going to have to figure that out soon.