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A study of 55,000 cell phone bills from ATT and Verizon strongly suggests that data throttling is useless, and instead a ploy to move customers to more expensive tiered plans. The money quote:

"Validas raises the question of whether the carriers were throttling simply because they want unlimited data customers to switch to limited, tiered plans. It is a befuddling question because it could potentially cost customers more over time. After all, how can a network be out of capacity if it can serve a customer on a limited plan without throttling if the heaviest data users on both limited and unlimited plans are consuming roughly the same amount of data?"
AT&T, Verizon Wireless and T-Mobile USA all practice data throttling, which involves slowing Internet transfer speeds for cellphone customers who use too much data. This policy applies only to cus...
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I am shocked, shocked to hear that the phone carriers are in this to make money!
Not just in it to make money...but screwing over the customers? Nah, that's not like any cellular phone company I know...
It is inconceivable that an industry with little or no real competition would actively work to squeeze more money out of its customers for a product that is increasingly seen as "vital" and an integral part of people's lives.

I don't mind paying for a service that I use. I just hate being "forced" to pay more for something that I once got for free before it was taken away and put behind an artificial pay wall. E.g. SMS messages, data tethering.
+Don Inbody And what's even more shocking, SHOCKING, I tell you, that they lie about why they do it instead of just coming right out with "Yes, we're greedy as hell and try to wring every possible penny out of our stupid customers (who don't have a choice because all the carriers do it)".
As voice shifts to being transported over the data connection and apps like iMessage remove the ability for mobile providers to continue to rape consumers for SMS, it's been clear to me for some time that they're going to close any holes they the "oops, we should never have done unlimited plans" one.

I'll resist it and scream right alongside everyone else. Thanks for the heads-up on this study, Tim.
+Jürgen Erhard I am waiting for more ubiquitous wireless and we can bypass cellular service with free access like Google Voice and other wireless telephone services.
I can see +Steve Borsch 's point. Now that the Apple products have caught up (sort of) with the rest of the Android and Blackberry ecosystems with regards to non-SMS messaging, it might be having an effect. That and the vast majority of low and mid tier smartphones are android-based devices. Those two things are taking away the cash cow of the carriers.
cant wait for a disruptive technology to wipe out these evil phone companies. Imagine a global wi-fi like service that cost pennies or nothing per month. These companies gauged us on charges with POTS systems and now they pretend that SMS, voice and data are somehow different and rip us off on each bucket. Its all just bits.
I hate the fact that I pay for an unlimited data plan and then have to pay extra for SMS. I've been trying to convince my friends for years to not send me SMS messages, but use IM or even email instead. No luck. I don't understand why people insist on using SMS.
+Dale Schultz Yes, great will be the day those evil companies are wiped out... and are replaced by other, maybe even more evil companies. :-P
yeah same in th UK its costs between 10 and 13p a txt message and then tehy get these madd settings for video and photo messaging wich goes upto 60p and about 1.00 for video messages. hence when looking for a new contract you look for the one with the most freebies...yet you still pay for them
It's pure greed. I've submitted my complaints to the FTC and FCC.
if you want to go one better look at the digital tv is one of the worst ring them with a complaint and they will provide as many silly non sense answers as possible. i recently complained to the regarding our equipment they provided with us. it took me three months to get back four months payments
That is why we were so glad when Sprint starting carrying the iPhone. Unlimited actually means unlimited.
who cares i am a kid and i dont have a phone so why would i care
This actually happened to me. I called my carrier to find out why my smart phone was slow over the Internet and when sending text. When I first purchased it with the unlimited data plan, it was moving warp speed. I started looking at mobile TV and doing more texting and all of a sudden everything was moving slow.

Come to find out they cut my speed down and said that I had actually used all of my 5 GB allowed for my data. When I asked how was that with an unlimited plan - I got silence. That's when I wised up and discontinued the mobile TV addon and I watch how much space I'm using. By the way, it took about two months before I actually saw more speed on my phone.
No surprise. It's always about the money.
Wait, you mean soulless corporations that don't care about their human customers use shoddy math in order to justify higher costs for lower tier services? I'm shocked I say, SHOCKED!
It's a marketing decision. I am on Sprint and don't have any of that throttling nonsense. If Sprint becomes #1, we will all look back on the throttling issue and show how it pushed customers away from ATT/Verizon and to Sprint. This will be a case study for MBA students everywhere.
So anyone have suggestions or ideas to bypass or have a better solution?
Hi, my name is Kenley and I'm a top 5% data hog on ATT. Is there even anyone we can complain to about this? As a long-time customer, I'm flabergasted to be treated in this manner. I can continue paying $30/month for 2GB (aka "Unlimited with Throttle") or I can pay $30/month for 3GB. Now that makes a great deal of sense to me.

And I haven't called them yet, but I have a suspicion that ATT will make me re-up for two years if I change my plan from Unlimited to 3GB.
You cannot just look at what you are being charged and how and decide that you are being ripped off. You have to look at the big picture and see what their costs are. If nothing else, these companies have fleets of vehicles that service their infrastructures. What happens when gas prices go up? That money has to come from somewhere. Network upgrades to keep delivering the faster and faster speeds demanded and keep up with capacity? It all costs money. An eccentric trillionaire does not donate telecommunications infrastructure to his greedy children who then proceed to price gouge consumers even though they could give it away for free. Why do you have to pay X when you only use X/2? Because that is how the actuaries and their ilk have structured things so that the company can make a profit and continue to operate. They could just charge you for the minutes you use--and pre-paid plans are available for that--but you would have to pay more. Ditto with contracts. The minute plans and the contracts allow them to offer lower prices than if you just had metered service like pre-paid. You don't have to "fight back" if you would prefer to use metered services--just use pre-paid and be happy. Or be like me and use VoIP and free SMS services and only have service when you have wi-fi access. Telecommunications infrastructure is not cheap. Thousands of miles of fiber optic cables, leasing rights-of-way, radio towers, buying satellites and blasting them into space, it all costs money. Lots of it. Maybe start a Kickstarter and try to raise a hundred billion dollars to build out a network "for the people"? Then you have to pay all the operating costs each month, salaries for thousands of employees, recruiters to hire them, HR people, lawyers, accountants, billing systems, customer service, insurance, maintenance, blah blah blah.
As of my recently purchased Galaxy Note, I'm only buying phones off contract from now on. It'll take a year and a half for all 5 of my lines to be off contract, but I want that freedom.
It's written on the article : the strategy is to put am incentive to move to targeted offers, which use DPI technology to suggest offers taylor made to your online behavior. But how will people react when they'll receive an SMS saying "we noticed you use Internet mainly for Facebook, would you like a cheaper offer with only mail and Facebook" ?
ISPs want to think customers will be happy that their usage is monitored, and actually they are right. Of course for us geeks it seems outrageous and orwellian but for the average user who thinks in term of usage and not price per kb,not even mentioning network neutrality, it's just fine : why pay for full highspeed Internet when all I do is mail?
I haven't seen how Verizon's practice live up to reality. However when they announced thier throttling plans they pointed out that they were only going to throttle 3G data connections at congested cell towers for people in the top 5% of data users. So if you weren't in the top 5%, or if you were using the faster 4G LTE network you wouldn't be throttled. Even if you were eligible to be throttled it is only if you are connected to a "congested" cell tower. So if you are in an area where there is surplus cell capacity you could be throttled without ever seeing your actual speed drop.

I personally average between 3 and 4 GB of data per month on Verizon and other than the initial annoucement of the plan I have not seen any indication that I am being throttled or am even in the top 5%.
+Fuzz Leonard true, although in infrastructure costs you have to account for data charging, dpi and policy enforcers. The companies selling and installing these equipment for millions of dollars are the one lobbying to ISPs marketing depts to favor offers that justify the technology. It's a real chicken vs egg question. One could argue that without cpu greedy stuff such as dpi networks would be much more efficient.
I remember reading something not too long ago that estimated the cost of a Gigabyte of data transfer cost carriers like Verizon something like $0.08. I'm not sure if that is entirely accurate but there's definitely a disparity between the price they charge and the actual cost associated with data transfer.
I would venture to say that for every heavy user, there are several other users with unlimited plans that never come close to being heavy users. The greed of the cell phone companies is ridiculous.
P2P Wifi
While in New York last week, I stopped by Common Pitch, a start-up competition held as part of Social Media Week. All the businesses were structured around a collaborative consumption model. And yes, there was indeed a wifi-sharing entrant, KeyWifi.

According to their website (still just a beta shell): " KeyWifi is the world’s first web-based, peer-to-peer internet access platform, allowing individuals to safely rent out their Wifi, opening up previously unavailable hotspots and turning the world into a potential 'Wifi zone'.”

The Common Pitch judges had loads of questions (security???). However, given the greedy strategies of Big Wireless, it could be an interesting twist.

(btw, if you want to read about Common Pitch - page down to the addendum here: Baby Clothes, Sharing, Paradigm Shifts & Collaborative Consumption (with addendum, 2/17/12)
+Karen Culpepper They're not going to get any less greedy anytime soon. The fact that the majority of their customers get locked into 2+ year deals makes it so they can charge whatever they please as they know you can't leave (without heavy charges.)
People aren't going to be using SMS or MMS soon thanks to data based replacements like whatsapp. Voice chats haven't gone the same way yet, but when they do the only way they will have to squeeze money out of people is to push up constraints on data usage. I'd bet on this getting a lot worse before it gets better.
Of course they are throttling in order to get the customer to leave the unlimited plan. The idea that it is about system capacity is just a joke.
+Kenley Neufeld AT&T does not make you re-up your contract to change your data plan. They will pro-rate your old plan and new plan and your next bill will be wacky but they make it easy to adjust your data plan. But once you leave "unlimited" you can't go back. The "get an extra Gb for no extra money" pricing is a ploy to lure customers away from the unlimited plans.

That said, I went off of the unlimited plan pretty soon after they began to officially support tethering. It really sticks in my craw that I have to pay a premium to "reserve" extra bandwidth that I'm not actually going to use just so I can occasionally tether my laptop to my phone when I'm travelling. Never mind the fact that I could do this before the first iPhone came out when I was using a Samsung flip phone. Or that for a brief period I could do this with my iPhone 3GS with one of the iOS3 releases thanks t a non-jailbreak network profile hack. I had to wait for AT&T to figure out a way to "fully monetize" this functionality before I was "allowed" to get my functionality back.
I use an average of a GB of data each month. .... wondering what you guys are doing?
I'm through the unlimited plan with TMobile. I have a 5GB limit and use 1/5 of it on average. I pay $97/mo after taxes. They offered me a new plan that I would be paying like $75 after taxes or less but required a 2 year contract. I declined. Don't like contracts.
+Micah Collard I recently saw this "pay more for ... i don't know what" with my Comcast bill. An additional $5/month but I don't know why. I'm still having random unannounced / unacknowledged outages. Maybe my service is faster, but I'm not going to notice because my stalwort, nearly 10-year-old linksys router is the bottleneck and I see no immediate need to upgrade it.

Going back to AT&T, the nickels and dimes for SMS overages are one thing. But to charge $0.20 per text message if you do not have a text plan and you cannot get a text plan for less than $10/month when you only use about 20 messages a month is ridiculous. Charging both sender and receiver seems a bit like extortion and as the receiver, I cannot block SMS messages. I must pay for the occasional spam or wrong number text message. Wait. I think AT&T has something where you can pay $5/month to block those messages. WTF?!? Seriously?! As with everything else associated with cell phone bills, the nickels and dimes have undergone 100x inflation and are now $5 and $10.
I just got throttled on my "unlimited" plan -- down to <56kbps speeds as punishment for transferring more than 5gb last month. I understand the fine print mentions this, but it shouldn't be legal to call THAT unlimited.
You know, the fine print, we have never signed that contract... We've had unlimited internet since before smart phones caught on.. almost 10 years now.
i dont have a smart phone :( but i do have verizon, which ROCKS!!!
SMART PHONE!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
"...and instead a ploy to move customers to more expensive tiered plans."
They had to do a study to figure that out? xD
People do studies to figure the obvious..... hmmmmm
Your job, should you choose to accept it is
to look at all plans, optimize your choices, make a choice and, then,
after 12 months or so, reevaluate. AT&T, Verizon, T-Mobile (dying)
and Sprint can do anything they want. However,
they get very uncomfortable when they start losing customers. When you decide to change providers, call your provider and tell them and find out if they will 'save' you for 12 months with a special deal. This happens
a lot (In Cell service and in Cable TV service).

Recall how the Internet (social media) changed how BofA
thought about ATM charges?

While 4 companies is not a wonderful free market, it is SOOO much
better than a Single Payer/Provider system - 4 times better by
any measure.

I regularly change Co's depending on what is offered.
Those who love Sprint with its "unlimited" will continue
to be happy until they either go out of town and discover
Sprint coverage isn't the very best it could be or Sprint becomes
successful and has so many customers that their section of
the bandwidth becomes crowded. Then Sprint will do what
AT&T is doing and Verizon does.
I don't know if anyone has mentioned this, but the U.S. wireless telecoms just started purchasing more bandwidth from the FCC. The FCC released the bandwidth to do two things; help to standardize a national emergency response system (we all know how GREAT that's worked out before), and to help stave off the federal deficit. Ironic, because the tax bill that just passed, will in effect, be paid back by the same people who supposedly received the break. You don't think that the telecoms aren't going to pass the buck, do you?
Bob J
Totally agree that it's not a good business move as the Verizon 4G LTE is so much faster and offers better coverage too.
They are working to find the best way to capitalize on customers with cell phone plans. They want to also catch the grandfather plans and bring them into the new "Give me my cell phone money" plan.
Looks like US providers are hitting curve peak (turning point), it was from throttled (time-based, volume-based) to true-unlimited, then now goes back to throttled again.
Global competitiveness :)

Yet FUP (fair usage policy) is needed, but should be pure conditional, based on network traffic. And why is it monthly FUP limit (reset at the next month)? They can make it daily FUP limit (reset at next day).
I am going to Hawaii and may see Dominic's appearence
They've probably tried throttling at some point, and then let up once someone finds out. Comcast is notorious for home Internet throttling, too bad there aren't many better options for us Bostonians. I switched to DSL, never looked back (I know this post is about mobiles).
+Francis Moran what would you like to know, that can be helpful/clarified to you? You seem like you want to know more, and +Tim O'Reilly is merely trying to help inform/spread the word about an issue publicly. I really want to help you understand what we're talking about, because an informed consumer is a great consumer, and that isn't meant to be condescending to you at all.
GREED is behind this and the oil crisis.
+Linton Rentfro I feel the same way buy new phone outright! No new contract or should I say extended but new contract!
This is a stupid conclusion, and I'm surprised at you +Tim O'Reilly for distributing it.

One cannot draw any conclusions about what the behavior of an unthrottled user would be by studying throttled user behavior. Of course the throttled users end up using about the same as the tiered plan users, because they don't want to be throttled.

The only thing this study shows is that throttling may be working as an effective deterrent for using "too much" data.
Ask any customer support carrier what is data? I had in the past all I heard was silence!
I switched to Sprint from Verizon 3 months ago. I have found Sprint to have better service in general, internet connections speeds definitely better with Sprint. Sprint cell coverage is not as good as Verizon without roaming but with their unlimited plan all roaming is covered at no additional charges. I am glad I switched, plus it has been cheaper without the throttling issues I had with Verizon.
+Francis Moran your reply is funny. I'm not sure if it's tongue in cheek or not, but to reply to your post; "Data Throttling" is basically, where your ISP (I.nternet S.ervice P.rovider, which would be your cell phone company, providing you with access to the internet or "web service" as some carriers might call it) "chokes" your ability to access the services on your cell phone. For instance, in this particular topic, most people are talking about how both AT&T and Verizon Wireless, are preventing people from accessing as much as they should be allowed to be, without any restrictions. Quite a few people pay for what's known as "unlimited" access where in theory, you as a user should be allowed to download as much information to your phone as you can. Some companies have this fine print where unlimited truly doesn't mean unlimited and that fine print is hidden in legal jargon that often makes a person's head explode. What's happening is, both companies claim that some users are hampering their respective networks because those users are "bandwidth hogs" or people who use an excessive amount of data, on a monthly basis. In order to supposedly make it fair for all of the users across the board to have reliable accessibility to the respective ISP's, the companies believe that they have to restrict those users who are exceeding normal usage, in their eyes. Once a user is restricted, they are losing out on the whole experience of having the unlimited service in the first place and instead, are not getting what they thought they should be. In some cases, unlimited truly means unlimited and even in those cases, the users are still not getting the full use of the service as promised. As a user, if you're paying for unlimited service and there is no fine print, you should be getting exactly that. If there is fine print and you weren't aware of it, well, you should be contacting the FTC and making your complaint heard. Additionally, you should be doing the same if you are paying for true unlimited service, and aren't receiving it. This article shows how a man recently sued AT&T successfully in small claims court because of it. I hope this helps. Again, if you still want more info, I'll be happy to help.
What's more pointless is to Champlain about it
Verizon doesn't even have unlimited
And t mo does the same thing
Ans sprint is slow as hell
If you actually use that much data get help
I've been grandfathered into unlimited on Verizon and just last month I used 6GB of data and haven't experienced this throttling people speak of...Must be luck or something
Three network in the UK used to do unlimited, but it was really limited to about 1GB and charged you after that. But recently started a "all you can eat", which has no limits. You have to pay more to get on it, but it means I never worry. I use Spotify, video etc and never really used a huge amount anyway. I think Three have realised only a small % of people used GB's and GB's of data. Most just get their email, play a youtube video every so often, may be play streamed music etc. They got it right and they don't throttle. These guys still think they live in the 00's and people use phones for txting and making calls only.

Very sad.
This is so true, but really pointless. Sad to see this from big players in the market.
Thank you Tim, hadn't seen this article.
source for the bits piece seems to be a blog entry by some company... is there a link to the actual study?
+Mr Mango that Three All You Can Eat data plan is SOOOOO much cheaper compared to what my Dad pays in the US for 4G Verizon (oh, and he can't even tether) that it boggles the mind. The US cellphone market is insane.

I'm about to switch plans (because I absolutely need a Samsung Nexus!) and really want to use Three, but I'm really uncomfortable with their coverage and lack of 2G/3G fall back. I'm probably going TMobile on The Full Monty.
I've wondered why I need a data plan at all. When I'm at home or in the office I'm on wifi. I can't read email or respond when driving, so why can't I just get a voice only plan and drop the $30 data plan? Besides iibe turned off 3g/4g as it drains my phone battery. Edge is good enough now that 2g is gone. im on T-Mobile
This may sound weird, the best plan for data that I have found is NOT in the US. That is to say, the US carriers supply substandard service for the money they collect. I find the Europeans have better services for less money. Unfortunately, the almighty Euro is causing them to adopt some of the tactics that the three US carriers have done in regard to throttling and I forecast that by the end of 2012, service for many in Europe will be like the US.(I have not been to the Orient so I have no idea what their plans/service are like.)
+Karl Lind Europe is also introducing a couple interesting new Laws considering mobile usage. f.e. they put a Cost-Limit on phone-bills; also regulating how expensive data-roaming may be, and much more.

So far, there are the first companies offering 1000min; 1000msgs and unlimited internet on your phone for 6€ a month flatrate. Price-dumping is very intense around here.
I believe Europe is a totally different market then northern america.
+Florian Dober Care to elaborate which country and which carriers? I haven't seen something even remotely close in Germany. Austria by chance?
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