Data Caps are Shortsighted

Every month I am filled with dread. I am on my phone constantly monitoring how much data I have used so that I don’t go over my 2GB data cap forced on me by AT&T when I bought my iPhone 4. When I bought the phone, I was childish enough to think that 2GB would be plenty. Now, half a year into owning my iPhone 4, I can say that 2GB is claustrophobic and stifles innovation, creativity and competition.

When AT&T nuked their previous unlimited data plan, many people were initially turned off by it until they realized that they didn’t use much data at all. Those people gained an advantage because they could save $10 a month by downgrading to the 250MB/month plan. That’s a significant amount of savings over the course of your contract. Unfortunately for people who actually use their phones, like me, we are stuck with 2GB a month (unless you were grandfathered in by having unlimited data previously.) There’s not even an option to pay for more bandwidth. The only resort is to go over data cap and pay an additional $10 per gigabyte.  So for $35 a month, I could get 3GB of bandwidth.

But wait.

Why would I pay $5 more for a data cap when competing networks like Verizon and T-Mobile are offering unlimited data plans for $30/month.

Unfortunately it seems that data caps are where the cellular industry is heading. Verizon announced that it will be offering new iPhone subscribers an unlimited data plan that will only be available for a limited time. After that, they will no doubt move to a tiered pricing structure much like AT&T.

The problem with data caps is that they turn customers off from using the network at all. What good is it to be the “nation’s fastest cellular network” or the carrier with “the fastest, most advanced 4G network” if your customers don’t even want to use your network for fear they’ll be charged more for going over their limit.  Carriers have essentially turned their networks into something as a last resort. Use your Wi-Fi when you’re home; don’t bother our network. A network which YOU ARE paying for.

Luckily, there seems to be one carrier left with some sense. T-Mobile has “unlimited” data on their network but in reality they have a 5GB cap but the great thing is that they won’t charge you more if you go over, they’ll just throttle your network. While it is a little disingenuous to call your plan “unlimited” when it actually is limited, I can live with their lie. First of all, their data cap has a large headroom, over twice of what AT&T offers. Secondly, the cap doesn’t require you to pay more when you go over the limited. Although being throttled would suck, it’s much better than being nickel and dimed into paying more.

Although there are four major cellular networks in the US, competition is rare because they share many of their restrictions. At this point, no one is pushing us forward.

If I record a video of a cop beating up an innocent person and want to upload it to YouTube, I have to second guess my decision because of this ludicrous data cap. Will uploading this video be worth $10? That’s not something anyone should have to think about.

2 thoughts on “Data Caps are Shortsighted”

  1. Do you think Sprint will follow suit? They currently charge for a “premium” data plan, but do not have limits or throttling.

    1. I really hope not. I think it’ll be a while before Sprint can start issuing data caps as they’re not doing so well and one of their only selling points is having truly unlimited data.

      The only way that Sprint can get away with truly unlimited data forever is to invest heavily in their infrastructure, which the other carriers have shown they’re not willing to do.

      AT&T let their infrastructure get so bad that they have to try and buy T-Mobile to expand their network!

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