Yesterday T-Mobile reached a massive $48 million settlement with the FCC over what the operator advertised as “unlimited” data. Instead, T-Mobile was actually sometimes slowing speeds for some customers who used more than 17 GB a month.
T-Mobile isn’t the only carrier that has faced troubles on this issue. The Federal Trade Commission filed a lawsuit against AT&T in 2014, alleging that the carrier misled as many as 3.5 million customers with legacy unlimited data plans by throttling their data speeds and changing the terms of their plans. In August, an appeals court threw out the FTC’s lawsuit, but the FTC is now working to revive the issue (which touches on a range of issues including telecom oversight and net neutrality.)
Likely as a result of these kinds of troubles, operators today are taking pains to more clearly explain what they’re doing with “unlimited” services. For example, in the FAQ for its new PopData unlimited offering, Verizon said that “before you can start a session, we’ll analyze network activity, strength and expected capacity for the next 30 minutes at the location where you make the request. This doesn’t guarantee that something unexpected won’t occur, like moving to an area with poorer service or more network congestion.”
Of course, all unlimited data services in the wireless industry contain caveats of some kind:
- Sprint: “Customers who use more than 23 GB of data during a billing cycle will be de-prioritized during times and places where the Sprint network is constrained.” Also: “Premium resolution: video streams at up to 1080p+, music at up to 1.5mbps, gaming streams at up to 8mbps. Data deprioritization applies during times of congestion.” Sprint’s high-speed hotspot tethering is capped at 5 GB and slowed thereafter.
- AT&T: “After 22 GB of data usage, AT&T may slow data speeds.” Also: “tethering and use of your device as a mobile hotspot are not allowed.”
- T-Mobile: “On all plans, during congestion the top 3 percent of data users (>26GB/mo.) may notice reduced speeds until next bill cycle. Video typically streams on smartphone/tablet at DVD quality (480p). Tethering at Max 3G speeds.”
What all this means is that wireless networks often cannot provide continuous high-speed data connections to all the customers in a cell site at the same time. Wireless networks are generally designed to withstand periods of high traffic, but every wireless network has a breaking point that is contingent on the number of customers accessing the network coupled with the amount of available spectrum, the design of the network and the technology running it.
As a result, to provide “unlimited” services, carriers are introducing a number of caveats such as “soft” caps that only apply during high-traffic periods of time, slowed or limited hotspot tethering and scaled down video streams.
And money plays a role too, naturally. After all, why should a single prepaid customer paying $20 a month be given the same network speeds as a postpaid family plan customer spending $200 a month? Already, AT&T firmly caps speeds on its Cricket prepaid service at 8 Mbps.
It’s also worth pointing out that wireless carriers aren’t the only ones playing with the idea of limitless internet access. Already Comcast caps usage at 1 TB. That cap is far above the average monthly broadband usage in the United States – around 190 GB per month, according to iGR Research – but it’s still not really unlimited.
But telecom companies aren’t the only ones moderating their services based on network technologies. Netflix, for example, scales its video streams to around 600 Kbps as a default on cellular networks to prevent both overages and overloading wireless networks. And ads from the likes of Facebook and Google can be adjusted based on mobile users’ physical location and other factors.
What all this means is that users’ wireless internet experiences aren’t really unlimited – they are curated. They are curated from the perspective that speeds are generally as fast as possible based on how much users are paying, how much spectrum is available to them, and what kind of network they’re on. Their experiences are also curated from the perspective of the internet services they’re accessing: Those services can be adjusted based on what network those customers are on, where they are physically located, and what they’re paying for. The alternative in some cases is a busy signal.
To be clear, users should be able understand how their experiences are being curated, and should have some measure of control over that curation. But the fact remains that true “unlimited” wireless service doesn’t really exist in today’s mass market wireless industry.
As T-Mobile’s $48 million settlement indicates, wireless carriers and others should be careful when they label something “unlimited.” However, it’s a much snappier marketing term than “curated.” – Mike | @mikeddano