By Melissa Daniels | Fri Feb 24, 2012 11:25 am
Carriers use throttling to manage data traffic, but a study shows the method has less to do with spectrum crunch than a way to shift users from unlimited services.
Validas, a wireless bill analysis firm, discovered data usage rates between unlimited and tiered plan data users were nearly the same.
"When we look at the top 5 percent of data users, there is virtually no difference in data consumption between those on unlimited and those on tiered plans -- and yet the unlimited consumers are the ones at risk of getting their service turned off," Validas wrote in its report.
Results differed between carriers, but Validas' data shows the average AT&T smartphone users don't drastically differ in their data use based on what plan they have, bringing into question the effectiveness of throttling for managing data traffic. AT&T is the center of a recent debate for throttling the top 5 percent of data users on its unlimited plans, with users reporting slow data speeds after less than 2-gigabytes of data downloads.
AT&T unlimited users consume more data but not by much, averaging 4-gigabytes a month, compared to tiered users, who come in just over 3-gigabytes.
For Verizon, data use in a single billing cycle for unlimited plans versus tiered plans is nearly identical, with averages hovering around 3.6-gigabytes and medians around 2.6-gigabytes.
Validas' analysis underscores how tiered plans work to the consumer's advantage to avoid throttling. Carriers who throttle users on unlimited plans nudge users towards tiered plans where they can charge overage fees, making more money while saving spectrum resources.
Throttling is a short-term solution, however, especially when increased smartphone and tablet use continues to eat up accessible spectrum.
Since data bandwidth is an increasingly valuable resource, offering unlimited data plans is no longer a sustainable model -- especially when acquiring spectrum meets political and regulatory roadblocks.
AT&T no longer offers new unlimited subscriptions, so a throttling policy is one way to handle growing demands on data. Those unlimited plans are also not necessarily a financial windfall for the company, or the user -- Validas says AT&T offers a 3-gigabyte data plan for $30 a month, the same price as the unlimited plan where users may experience slow data speeds.
Carriers have different policies when it comes to who to throttle and when, but the practice affects hundreds of thousands of users. Jeff Giles from the Philadelphia Inquirer estimates the policy affects 250,000 to 300,000 customers each month, according to data from AT&T that says the throttling policy affected one half of 1 percent of its smartphone customer base.
Despite its reputation as an unlimited data service, Sprint is throttling its top 1 percent of users as it also moves away from offering unlimited data plans on netbooks, notebooks and USB, and is offering tiered plans for tablets.
Number one mobile carrier Verizon throttles the top 5 percent of unlimited data users, and T-Mobile throttles its smartphone subscribers after 5-gigabytes of data usage in a single billing period.
Throttling unlimited users may serve as a ploy to get them to switch to tiered plans, but it does not guarantee better spectrum management in the long-term. In the meantime, more consumers are flocking to smartphones with expectations of data speed and services, which the carriers are not necessarily ready to deliver.
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