Monday, October 12th, 2009

How Much Would You Pay for Reliable Over-the-Air Bandwidth?

October 8, 2009 by Rico Mossesgeld  
Filed under Ramblings of a Gadget Geek, Services

During a speech at the CTIA conference, AT&T CEO Ralph de la Vega “hinted at an unpleasant way of dealing with… the disproportionate wireless bandwidth usage of iPhone users”. PC World’s Mark Sullivan thinks de la Vega will start throttling bandwidth for iPhone users, who according to Sullivan represent only 3% of AT&T’s smartphone users, yet are responsible for 40 percent of over-the-air (OTA) bandwidth usage. AT&T apparently can’t keep up with the demand, especially since the wireless spectrum in the US is getting more crowded nowadays.

AT&T Coverage Map

Too Many Customers, Too Little Capacity

The problem with “rationing” OTA bandwidth is of course, pissing off a lot of customers, who pay monthly for data plans, with the expectation that their mobile internet experience will be seamless and responsive. Most probably AT&T problem isn’t unique, simply because operators throughout the world have a nasty habit of promising what they can’t deliver.

Like any other resource, OTA connectivity is limited. Stress the network with enough people, and you’ll have dropped connections, slow data transfers, and other common symptoms that have frustrated many data users. That’s because operators are under constant pressure to increase the number of subscribers, to show shareholders that they’re taking steps to grow the business. The problem is that, while snazzy marketing campaigns quickly add converts to an operator’s customer base, the same isn’t true for increasing capacity and infrastructure capability.

What’s Your Budget for Reliable Mobile Connectivity?

Thus my question: how much would you pay for reliable OTA bandwidth? How much are you willing to spend on a regular basis in return for mobile online access featuring reliability and speeds that truly rival wired services? Two times as much? Three times as much? The answer to that question is of course, subjective, but I’ve got no problems sharing my personal willingness to pay four times as much as current rates. In return however, I expect virtually no downtime, and a promise to refund for connection failures, prorated to the length of the downtime.

There are problems with my proposal: operators can simply claim users weren’t within an area with good network coverage (a traditional excuse they use to explain away network failures). And of course, you have shareholder pressure to boost the numbers.

But I still think it’s a good foundation for reforming the market, and something has to change. Operators should stop luring in customers with relatively low-priced data plans, then leave them hanging with poor service even before the ink on that two-year lock-in has dried. There a sound business reasons driving this approach, but it’s hardly a sustainable model.

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Comments

One Response to “How Much Would You Pay for Reliable Over-the-Air Bandwidth?”
  1. DavidB (subscribed) says:

    Isn’t that funny. ATT whines about there not being enough bandwidth, and then they go ahead and approve VoIP apps for use on iPhone et al.

    It’s well established that carrier “unlimited” plans REALLY only mean 5GB (or in some cases less) per month. ATT has it the worst right now and will remain so as long as iPhone remains exclusive to ATT. At some point, their other 3G customers (on BlackBerry, WinMo’s, Android’s, etc.) are going to start clamoring that they are subsidizing iPhone data use and they aren’t happy about it.

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