Mobile data plans have been in the news quite a bit lately, with Verizon (LTE plans) and AT&T (iPad and iPhone plans) updating the market on their mobile data positions. Verizon has all but announced that there will be no unlimited data plans on their LTE network, which is now scheduled to go live in 30-40 cities in Q4 2010, and people will pay based on their usage. AT&T announced that they are doing away with the unlimited iPad plan (already) and will now support tethering for the iPhone (but only for a 2GB/month plan). Other mobile operators also would rather have data plans based on usage rather than unlimited plans, but it remains to be seen how long or if operators with rich data devices can hold out, or if the pain of congestion will hit their network as it has for AT&T.

But is the ideal answer for mobile data to always bill based on usage? Although I understand the issues that are driving the operators to implement usage based plans (cost control, congestion management, etc.), I think that there are hybrid plans that could significantly accelerate the adoption of mobile data usage (and fixed mobile substitution for some users). Mobile operators could serve their customers better by offering flexible plans that were targeted towards different “consumer” types on their mobile network that were sensitive to application usage and time of day. These plans would be ideal for the new generation of rich media devices (Android phones/tablets, iPhone, iPad, and laptops) and accelerate their adoption by the consumer groups that covet the devices but are still afraid of bill shock (which will be even higher now that overage charges are going to be pervasive). It has been proven that devices can sell data plans, but the plans can also stunt the usage of the devices if using them becomes too complicated and expensive.

What would these plans look like? Most plans would be similar to the existing plans, with usage meters for the majority of data and separate usage meters for the applications that are attractive to specific consumers, with streaming video, audio, and file sharing leading the pack. Although web pages can be a lot of data (I once read an analysis that said the BBC front page was 1MB of data, which could cost you a pretty penny when you are roaming!), the real problem for mobile operators are long-lived streaming or downloading applications that can cause persistent congestion in a cell or on the network. Some examples of targeted plans:

• Streaming Video: Monday through Friday 8 a.m. to 6 p.m., 25GB of data, unlimited nights and weekends
• Streaming Audio: Monday through Friday 8 a.m. to 6 p.m., 10GB of data, unlimited nights and weekends
• Unlimited Web: Unlimited web browsing and email, 2GB streaming media and other applications
• Social Media: Unlimited Facebook/MySpace/IM/email, 2GB other applications

These plans could either be an add-on to an existing data plan, or part of different bundles for users. A very attractive iPad plan would offer unlimited web browsing, but a usage meter on other applications. I don’t see these plans as being negative towards Network Neutrality, since they will be selected by the users – as an alternative to the pure usage-based plan that the mobile operator would also offer. Time-based plans are already popular among mobile operators for voice, and could easily be popular among students and business travelers (i.e. Nights and Weekends plans).

My concern is that placing restrictive limits on bandwidth usage will stifle or limit the potential of the nascent market for rich data devices, or limit their use to Wi-Fi networks, which completely misses the goal of upgrades to LTE and other high speed mobile data networks – which is to make access ubiquitous for users (and not ubiquitous just for email). The challenge of implementing these plans is on the systems that would be used to meter the different applications (i.e. DPI systems) to ensure that the application classification is accurate.

An innovative mobile operator that offered these plans as an alternative to a more restrictive plan could tip the scales in their favor when competing for the “high value” users for mobile data. In the highly competitive mobile market, operators that think outside the box and find ways to best leverage the technology that they are already deploying in their networks will emerge victorious and profitable. Flexibility will be a key success factor.

As a user – would you be more likely to purchase a plan that gave you flexibility in how you used your mobile broadband?  I know that I would.

Tags: bandwidth, bandwidth control, congestion control, deep packet inspection, DPI, mobile data plans, mobile operators, net neutrality, social media, streaming music, streaming video, traffic analysis, traffic identification, traffic management

This entry was posted on Monday, June 7th, 2010 at 9:17 am and is filed under Industry, Technology. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.