About a week ago, AT&T announced the end of unlimited mobile data pricing for new subscribers. This on the back of Verizon (News - Alert) stating that LTE data pricing will be tiered as well. Separate from any discussions on whether these moves are good for the average consumer (read Pogue, and in fact, my own BlackBerry (News - Alert) usage has never exceeded 75MB/month giving credence to rumors of dancing in the streets in Waterloo), or just another move by 'The Man,' I look at this as a watershed event for the industry.
For years, mobile operators have been dancing around the mobile broadband pricing question, creating confusion in the process with various flavors of 'unlimited' data plans and avoiding more difficult issues such as tethering. This while encouraging smartphone adoption and use through subsidies. It made it very difficult to draw an apples-to-apples comparison between operators.
Now, AT&T acknowledges that mobile broadband, and not legacy voice or even SMS, is the future, and they've set out to create a sustainable business based on fairness. Over the last year, a lot has been written by myself included on the pending collapse of the operators under all you can eat data. Well, now you have the answer. No more feeding frenzy. Putting these changes in context, there are some interesting observations to be made, tying together parallel trends that impact both users and operators.
The role of Agents. An old topic, but probably more relevant today given connectivity options. Consider an intuitive tool that could trigger content downloads based on the time of day or network connection. Wake up, and your morning paper and videos are pre-loaded. Looking forward to the latest movie release? Set it to load in advance (and see 5 below). Short on 3G data for the month? Set a download to occur when back in WiFi (News - Alert) range.
What video download really means. The day after the announcement, one complaint was that an hour of video could easily burn through 1GB. Sure, DVD quality (mpeg4) on a flatscreen at home might consume this, but not on the typical smartphone. Applications such as Netflix are designed to back off their bandwidth when streaming over 3G, an observation quickly made when the 3G iPad was released. So, we're talking about something closer to 125MB for an hour, providing a bit more leeway. Addicted to video? Go find a hotspot. It is not like you're watching '24' while driving the 17 from Santa Cruz.
The 'M' word… multicast. Back when I was a router jock, we all had high hopes for multicast across the Internet. Neatly packaged nuggets of content that would be consumed by thousands at once. What we've since learned is that the Internet, with the likes of Youtube, is not a neatly packaged place. The less than stellar growth of Qualcomm's (News - Alert) FLO TV is another indicator of this. To be realistic, it is not surprising that the majority won't pay for yet another service on a limited set of phones. However, there is a role for a multicast-like service, if the Final Four or the World Cup is any indication. The technology is there, but it won't happen overnight. The same technology may be used to stagger network demand for the latest cinema releases. Want it now (aka unicast)? Pay a premium? Willing to wait 15 minutes (multicast, much like the cable operators)? Your data plan takes a much smaller hit. As I said, this is something that could be phased in over the next 3-5 years.
The Role of WiFi. Unnoticed in the announcement was the fact that it did not mention WiFi usage, still unlimited. High-volume subscribers will be even more motivated to seek out hotspots (both within and outside of the home), and AT&T and others will be motivated to create a more seamless handover between technologies. Optimized use of WiFi of course could leverage, covered in (1).
Netflix and DRM. We need some middle-ground between the red envelope and the 'live' on-demand option. How about a time-limited local cache, counted against the monthly 3 or 4 at a time plan? More convenient than snail-mail, better quality than streaming across 3G, and if under some intelligent agent control, (or not), guaranteed to save 3G bandwidth.
Rollover. A nit, but worth mentioning in any case. The time I really want 3G is when I'm traveling with the family. This doesn't occur every month. So, in the spirit of rollover minutes, how about rollover data?
(Note: You'll notice that I'm no longer at InnoPath. A blog too far. Visit me at www.thirasystems.com.)
David Ginsburg (News - Alert) is the founder of ThiraSystems. To read more of his articles, please visit his columnist page.
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