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story category Consumer 3G Spending Slows
Users still see data card 3G broadband as luxury
(old news - 12:20PM Friday Apr 10 2009)
tags: prices · business · wireless
According to the latest data from ComScore, 3G data card use grew at a rate of 163% in 2008. Still, the fourth quarter of last year started to see a significant decline in user growth, something ComScore blames on the struggling economy. Many consumers still see 3G wireless data as a luxury item -- and can't quite justify the $60 (plus fees) for 5GB worth of usage that's the industry standard. In contrast, most still seem perfectly happy to keep their home broadband and TV service despite tight budgets. Could 3G data price cuts soon make an appearance to target more cost-conscious users?

Related:
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  3. Verizon To Double Smartphone ETFs?
  4. Verizon Offers New Prepaid Wireless Broadband Plans
  5. Virgin Expands 'Broadband2Go' Availability
  6. Wireless Industry Pricing Plans Confuse Economists, Too
  7. Time Warner Dallas Customers Get WiMax December 1
  8. In-Flight Internet Headed For Bumpy Landing?
Forums » Consumer 3G Spending Slows
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Rob
In Deo speramus, God Bless the USA
Premium
join:2001-08-25
Kendall, FL

Could 3G data price cuts soon make an appearance?

Not unless some company starts up and offers 3G data at a much more reasonable price with a larger cap (20GB-30GB).

TKJunkMail
Enjoy the sun
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Avalon, NJ
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·Comcast

Re: Could 3G data price cuts soon make an appearance?

said by Rob See Profile :

Not unless some company starts up and offers 3G data at a much more reasonable price with a larger cap (20GB-30GB).
The existing cell tower infrastructure can't support the load that raised caps would put on them.
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k1ll3rdr4g0n

join:2005-03-19
Homer Glen, IL

Re: Could 3G data price cuts soon make an appearance?

said by TKJunkMail See Profile :

said by Rob See Profile :

Not unless some company starts up and offers 3G data at a much more reasonable price with a larger cap (20GB-30GB).
The existing cell tower infrastructure can't support the load that raised caps would put on them.
It depends on how you look at it. A neighborhood all downloading torrents at the same time? Yeah, no one will be able to use their cell phones. 1-2 people doing casual surfing downloading...it will probably be fine.

But, this is why god brought down the wonderful concept of QOS. If 10 people are all bit-torrenting at once then throttle them and other heavy users to low bandwidth to allow other users the ability to use it. Makes sense no? Kick back the heavy use users, while allowing the average users a good "user experience". Or we can take the illogical Comcast approach and just block everything under the sun (ok so they just blocked torrents).

If companies are really worried about the towers not supporting all the users, then we have bigger problems...like where are our monthly payments going to? I mean on average a person pays $50/month, times what? a million customers? This is 2009 and not 1999, either the companies get with the times or leave the industry.

DaveNJ
No Fear

join:1999-09-01
New Jersey
·Comcast
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said by TKJunkMail See Profile :

said by Rob See Profile :

Not unless some company starts up and offers 3G data at a much more reasonable price with a larger cap (20GB-30GB).
The existing cell tower infrastructure can't support the load that raised caps would put on them.
Part of the problem is fiber, its taking more time then expected to get fiber delivered, so there is a delay, i think in a year or 2. Wireless is going to catch up to at least compete with DSL.
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Nerdtalker
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Tucson, AZ
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Re: Could 3G data price cuts soon make an appearance?

said by DaveNJ See Profile :

Part of the problem is fiber, its taking more time then expected to get fiber delivered, so there is a delay, i think in a year or 2. Wireless is going to catch up to at least compete with DSL.
And the underlying problem (why you need fiber to each cell site) is that the backhaul sucks.

AT&T's network is a perfect example. HSPA is capable of speeds well in excess of the iPhone's hardware (~3.something megabits/s). The reason you'll never see those speeds is because the backhaul (tower->tower links, either microwave, some sort of local loop, or otherwise) isn't fast enough for all the load.
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tiger72
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join:2001-03-28
Saint Louis, MO
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Re: Could 3G data price cuts soon make an appearance?

yep. They're T1's for the most part. Doesn't make much sense to me upgrade the hardware for anything above the regular ol 1.8mbps HSDPA when your backhaul is only 1.5mbps... The 3.6 and 7.2mbps upgrades are a waste of money until then.

vv1r3d

@mchsi.com

said by TKJunkMail See Profile :

said by Rob See Profile :

Not unless some company starts up and offers 3G data at a much more reasonable price with a larger cap (20GB-30GB).
The existing cell tower infrastructure can't support the load that raised caps would put on them.
That is what "first come first serve" is for! Also, data compression would help quite a bit.

Simba7

join:2003-03-24
Billings, MT

Re: Could 3G data price cuts soon make an appearance?

Not really.. Data compression can only do so much. When the file is already compressed, it's useless.

en102
Canadian, eh?

join:2001-01-26
Valencia, CA
·RoadRunner Cable
·DSL EXTREME

Re: Could 3G data price cuts soon make an appearance?

It comes down to the following:

1. There's a limited amount of spectrum (varies by market/county/MTA/BTA) accessible to any site.
2. Cell site 'density' (allowing for 'reuse' of spectrum). Sites aren't cheap (equipment, NIMBY, power, backhaul). Sprint worked out well here in SoCal, as they purchased Nextel, and added their CDMA sites onto Nextel cell sites (bypassing NIMBY/site build and many slow regulatory processes).
3. Use (data/voice) management

Balancing the above 3 while attempting to make profit margins demanded by Wall Street isn't always an easy job.
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Nerdtalker
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said by TKJunkMail See Profile :

The existing cell tower infrastructure can't support the load that raised caps would put on them.
The burden shouldn't be on the customer to keep his usage of "unlimited" data "fair," it should be the provider's obligation to do just that, provide service.

I agree that they can't support load. I don't agree that this is the problem of the consumer.
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djrobx

join:2000-05-31
Valencia, CA
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In the case of wireless I think 5GB caps actually make some sense. I don't think mobile broadband networks are currently up to handling people using them to serve torrents, sling TV, or stream music several hours a day. So, I think it's priced and limited to deter people from using it as a primary source of iternet.

On the other hand, there's a solid demand for people who have broadband connections that just need to be able to surf and get their email when travelling. $60/month for that sort of usage is crazy. I think that's why AT&T is looking at bundling limited data and DSL together.
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BF69

join:2004-07-28
Camden, TN

Re: Could 3G data price cuts soon make an appearance?

said by djrobx See Profile :

In the case of wireless I think 5GB caps actually make some sense. I don't think mobile broadband networks are currently up to handling people using them to serve torrents, sling TV, or stream music several hours a day. So, I think it's priced and limited to deter people from using it as a primary source of iternet.
IF you're only using it for MOBILE then sure 5 GB is enough, BUT these companies like to state how you can use this for your PC. And frankly 5 GB is a joke. For those that don't have access to DSL or cable this COULD be an alternative. 5 GB? Dial-up potentially uses 17 GB a month. also the overage fees are outrageous $256 per GB for Verizon $503 per GB for at&t. There isn't ANY justification for that. WHile I understand that they can't offer caps like Comcast or Charter in the 250 GB range they certainly can offer say 25 GB. And $1 per GB is certainly enough for them to pay for costs and make some money.

chd176

join:2003-01-10
Winfield, AL
·CenturyLink

Tethering?

Maybe people asked around and some others suggested tethering? While clearing against the TOS depending on who you are with unlimited data (for use on your phone only) is offered from about $9.99 to $19.99 a month. Personally this is what I do although I'm well aware that I could be hit with a huge bill if AT&T wanted
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kfsutops
Premium
join:2002-08-19
Brandon, FL
clubs:

Price Decrease?

Are you kidding? Of course not.

3G slows because business are not spending as much money. People are getting laid off. The people getting laid, the companies have no reason to add additional users.

This will never penetrate the consumer market at the prices and restrictions these companies want for the service (except in areas where they can't get cable/dsl).

A friend of mine asked me about getting a card two weeks ago? I was like, "are you crazy?" The price is ridiculous. They cap the service and you can get much more from you DSL.

I have a card from Verizon provided by my company. So I use their service and it basically sucks. The speeds are not good and that's when I can actually get connected.
--
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nitzan
Premium,VIP
join:2008-02-27

I'd buy a 5GB data plan...

...once it sells for $10/mo.

I don't mind the cap that much- it's not like I'll be downloading stuff over 3G, it'll be used primarily for work. But it's the price that's the real killer. $10-15 I can live with - $60?? no thanks.

Simba7

join:2003-03-24
Billings, MT

Love my unlimited data..

I still have my unlimited data plan from Alltel. It's teathered to my PPC-6800 using WMWifiRouter. Although I pay around $100/mo for phone and data, it's been worth it on several occasions.

Muhahaha
molecriket

join:2001-02-26
Edgewater, FL

3g Joke

If you are so addicted to your stupid cell phone internet connection then you should have to pay alot for it. Most of the time you can wait to get home and use your cable or dsl connection there. This is primarly a business function or a toy for the monitarily gifted.

RR Conductor
RailRoadDude
Premium
join:2002-04-02
Redwood Valley, CA
·Comcast

Re: 3g Joke

said by molecriket See Profile :

If you are so addicted to your stupid cell phone internet connection then you should have to pay alot for it. Most of the time you can wait to get home and use your cable or dsl connection there. This is primarly a business function or a toy for the monitarily gifted.
That is some logic, some weird logic.
prairiesky

join:2008-12-08
Springstein, MB

protecting their wired networks

the other reason there are caps and that it's expensive is that they are trying to protect their wired networks. That's the infrastructure that can handle the higher speeds and it's already in place. If people went to wireless, it would make the wires obsolete.

Voyager2K2

join:2001-10-04
Wayne, PA
·Verizon FIOS

P2P

P2P is the problem.
Managing a very busy computer service shop (one of my hats) I regularly see 20-40 GBs of music in the Limewire folder of customer's systems, not to mention the videos that have been deleted. They are sharing these files as well.
Not to get in to the morality of this practice, these folks are raping their Internet connections. These are not the savvy folks that hang out at DSLR, but just folks who want "their music".
The cellular networks will never be able to handle the kind of bandwidth required for the insane consumption P2P requires.
That's the major reason the 5GB caps are in place.
I also agree that for many users given the state of the economy 3G is a luxury/novelty that's easy to do away with.
BigJames523

join:2007-09-07
West Palm Beach, FL
·Comcast

My $.02

My Wife and I are currently staying with her Mother to help her throught the last few months of her life (cancer is a you know what) and we don't want to add any stress on to her, but we needed an Internet connection. We got 1 aircard, which my wife use's at work quite often, but not for work purposes. She likes to stream netflix when she has down time. Recently, they called us because we had went over out 5GB cap, and they told me it was over 1.2 MB.. thats alot of money, but they took care of it being our "first offense". I am just so upset that something simple, like this, and she eats up the 5GB in a 3 week period. It makes me so upset for getting it, and having to do this.

jgkolt
Premium
join:2004-02-21
Lakewood, OH
clubs:

3g and 5 gigs, please

The tight restrictions on verizon 3g and 5 gig caps? it is no wonder it is not taking off, on top of it costing 60 a month. if they truly want it mainstream they will remove the restrictions and lower the price. In the meantime it is priced for the high end consumer, not for the masses. they know how to do more volume, and they have yet to do it.
nolesch

join:2006-05-16
Paducah, KY

Re: 3g and 5 gigs, please

5gb not enough to justify at 60 dollars a month. Cap too low, cost too much. Just like article says, if you got 60 dollars a month to blow, for a service you have to be overly paranoid to use cause you may go over, and thus are limited to a few pages of web surfing and email download, then fine. I don't, and won't waste my money on that. And, I continue to enjoy company copy catting. They ALL have to have a 5 gb cap. What's up with that? How about some originality, like Crickett.
Forums » Consumer 3G Spending Slows


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