Data throttling debate heats up following new study results

The great debate rages on regarding operator attempts to restrict data speeds for some of their mobile broadband customers. Though Cisco Systems recently released research that showed data speed throttling does reduce usage, another study found virtually no impact.

Looking at the top five percent of data users, "there is virtually no difference in data consumption between those on unlimited and those on tiered plans," according to a blog post from Validas, which analyzes the mobile-phone bills of consumers.

Validas studied 55,000 cell phone bills over all of 2011. Among specific findings, the company revealed that AT&T (NYSE:T) users falling into the top 5 percent of data consumers hit 3.97 GB of data on average, with a median data use of 3.07 GB. Users on tiered plans averaged 3.19 GB of data each month and a median of 2.54 GB.

Though Validas found little difference in usage between users on unlimited plans and tiered plans, the unlimited ones are potentially subject to having their data speeds throttled. "So it's curious that anyone would think the throttling here represents a serious effort at alleviating network bandwidth issues. After all, Sprint (NYSE:S) gets by fine maintaining non-throttled unlimited data to its customers," said Validas on its blog.

Validas' findings are at odds with numbers reported a couple of weeks ago by Cisco Systems in its latest Visual Networking Index Global Mobile Data Traffic Forecast.  "While the number of tiered plans as well as the usage per tiered plan are increasing, the average usage of a connection on a tiered pricing plan is half that of unlimited plans," said Cisco.

Cisco contended that due to tiered pricing, the megabytes per month consumed by an average top 1 percent of mobile data users have been steadily decreasing compared to overall usage. "At the beginning of the two-year study, 52 percent of the traffic was generated by the top 1 percent. At the end of the 22-month time frame, the top 1 percent generated 24 percent of the overall traffic per month," said the firm.

More than a few critics have suggested that throttling is not being enacted to rescue mobile networks from greedy spectrum hogs, but, rather, is just a way to get grandfathered unlimited users to switch to more costly tiered plans. In that case, throttling is merely a revenue play, not a network-rescuing play. With network deployment and maintenance costs rising while revenues stay flat, it is not farfetched to imagine that at least some throttling is related more to revenue enhancement and less to sheer data traffic management.

In a way, traffic speed traps might provide a good analogy. The police say speed traps are necessary to slow down traffic and made individual drivers more aware of the speed limit, while many ticketed speeders contend such traps are all about raising revenue for the locality and do nothing to reduce speeds. Both sides have supporters and detractors, and the situation is much same as it relates to backers and critics of data speed throttling. Perhaps the truth is somewhere in the middle in both cases.

Fore more:
- see this Validas post
- see this New York Times post
- see this article
- see this Cisco release

Related articles:
Data throttling: Annoying but effective
Cisco: Video will generate 71% of all mobile data traffic by 2016
Cisco: Global mobile data traffic to increase 18-fold by 2016