back to article Verizon to limit unlimited 4G plans

Verizon has decided to throttle some users of its 4G network. There's nothing entirely new or sinister in the decision, as the company's notice of the change points out that it operates a “Network Optimization policy” that “limits the data speeds of the heaviest 3G data users – only select subscribers with unlimited data plans …

  1. Khaptain Silver badge

    What's in a contract

    With the statistics that the Telcos already have, I would presume that they are very well aware of statistical usage. In other words they knew fine well that people would be watching TV on an almost 24h basis..( TV is an example of one streaming channel, replace with whatever).

    In order to prepare for this eventually it was much cheaper to write a get-out clause in the contract than it was to actualy build a network that worked as advertised.

    I wonder how much better the network would be if they used 5% of the top execs bonuses in order to improve the equipment ?

    1. Anonymous Coward
      Anonymous Coward

      Re: What's in a contract

      If Verizon built a network that 'worked as advertised' no-one would be able afford to use it - for the same reason that a guaranteed, uncontended, exclusive leased line costs 15 times or more what a consumer broadband product costs. Broadband is only affordable because you share the available bandwidth with other users.

      Looking at Verizon's execs total remuneration (pay, shares, bonus) for the last reported year (It's publically available), 5% of that sum is $1.9M. So the answer to your question is "not much".

      1. Khaptain Silver badge

        Re: What's in a contract

        @AC, $1.9M can go a long way to providing the correct information vis-s-vis des clients. They could start be rectifiying the false promise of "Unlimited" anything.

        $1.9M - They could add to some extra equipemnt in the worst hit zones.

        $1.9M - They could subsize those they don't get what they were offered.

        $1.9M - That pays for the next round of aperitifs on board a luxury yacht whilst laughing about how many more punters will be signing up for unlimited 4G whilst knowing that it simply isn't possible.

        1. Preston Munchensonton

          Re: What's in a contract

          I don't have a better estimate, but Verizon spent approximate $500M just to upgrade 25 cell sites:

          http://www.bizjournals.com/orlando/blog/2013/05/price-tag-on-verizon-4g-lte-expansions.html

          Not that every cell site will require a $25M retrofit, but $1.9M doesn't truly build all that much.

          The parent company doesn't break out the wireless component of CapEx, but I can't believe that they spent most of that $16B from 2013 on FTTP rollout:

          http://www.verizon.com/investor/app_resources/interactiveannual/2013/index.html

          Given that two-thirds of their revenues come from wireless, it's safe to say that most of that CapEx goes to wireless too. Either way, $1.9M looks really insignificant and debating about the good it could do makes you look very foolish and short-sighted. Keep your eye on the bigger picture.

          1. Khaptain Silver badge

            Re: What's in a contract

            Let's see just how poor these buggers are

            http://newscenter.verizon.com/corporate/news-articles/2014/01-21-verizon-reports-2013-4q-earnings/

            It looks likw they really could afford to upgrade a bit.

  2. pierce
    Boffin

    there's only so much radio bandwidth possible in a cellular system. if you have 10000 users in an area all streaming 5Mbit/sec videos, thats 50 gigabits/second sustained. there's no way the cellular architecture can cope with that.

    they should never have sold "unlimited" service, and encouraged that expectation, it should have been metered from the get-go... use more, pay more. if too many people are using more than you can deliver, jack the prices til the usage drops to manageble levels. use a tiered pricing system so moderate/occasionalusers pay significantly less per unit than data hogs.

    1. Richard Jones 1

      First a disclaimer, I do not do mobile streaming, ever. So no special pleading here.

      The design and distribution of cell sites is a technical effort that should be based on user location and usage data. However if you rely on the 'bung one in and hope' method results are likely to be poor. The 'All you can use' tariffs came from marketing; Capex and Opex limits come from the financial control side and customer demand comes from customer expectations of what they bought. Perhaps customers were simple minded, though in the case of some operators you need to be worse than simple minded to believe they would ever supply what they sold.

      Above all cell sites need to be managed, in a normal well run enterprise this would mean cell division or other augmentation techniques, in Verizon's and many others cases it means service down grading, how typical.

      It is the same the world over, you had good service from T-Mobile? Oh we are are EE now so we will pull out a few cell sites to save money and the service can go hang.

      It is just that for some the technical aspects of service management are on another page in another book.

      1. Anonymous Coward
        Anonymous Coward

        "pull out a few cell sites to save money"

        Saving money is essential in a market where consumers buy pretty much on price alone. The better, more costly network fails in the market.

        Do you really think that experienced RAN engineers work on the basis of "bung one in and hope"? It seems unlikely.

    2. Arctic fox
      Thumb Up

      @pierce Re: "it should have been metered from the get-go..."

      I entirely agree. The marketing of these so-called "unlimited" plans has been dishonest from the outset. How it is that the ASA has not descended on them (the telcos in general not just Verizon) from a very great height over the term "unlimited" is a mystery to me. It is clear that no infrastructure as currently envisaged could cope with people having high-res streaming on virtually continuously. Some throttling of the most intensive users is unavoidable. However, they should be genuinely open and honest about that in their advertising, not just in the small print.

    3. Anonymous Coward
      Anonymous Coward

      Reason for "unlimited"

      Blame human nature, or blame Apple, take your pick. Consumers have shown a strong preference for "unlimited" (data, calls, texts, etc.) over limited plans that offer far more than what they actually use. AT&T found that most people would pay $20 for unlimited texts rather than $15 for 1000 texts a month, even those who averaged well under 100 texts. They like certainty in their billing, even if they must pay more for that certainty.

      Some blame could be pinned on Apple here for starting this for data, because they insisted AT&T allow unlimited data for the iPhone when it came out. The iPhone made much heavier use of data than previous smartphones (i.e. made it more useful, with a full browser instead of WAP, better apps, etc.) Since it is difficult to know "this website is 4MB every time I visit it" and take that into account when budgeting use, Steve Jobs didn't want iPhone users to feel restricted in that way as it would lower customer satisfaction.

      You're right of course that unlimited is impractical for cellular data once everyone is using it - it can't be used in dense areas for regular internet connectivity, for instance. It only works well if not too many people are doing it - and AT&T demonstrated what happened when too many were, since for years they had all the iPhone users in the US and their network had a lot of problems as a result (that wasn't the only problem, the small size of GSM cells makes providing full coverage more difficult)

  3. Shannon Jacobs
    Holmes

    No such thing as uncontested connections

    The issue is NOT wireless versus wired. The issue is CONTROL, as in the big companies (and their pet governments) want to control our access to the Internet. If most of the content was moving locally via shared WiFi networks, then they wouldn't have any chokepoints. Yes, there are some natural monopolies, but information is NOT one of them.

    1. Phil O'Sophical Silver badge
      FAIL

      Re: No such thing as uncontested connections

      Yes, there are some natural monopolies

      The laws of physics, for one.

  4. A Non e-mouse Silver badge

    Shock horror!

    A company offers an unlimited product, then has to back-track when it finds some people are using so much of the unlimited product it's affecting all it's other customers.

    Don't these companies ever learn by their mistakes? If you offer an unlimited service/product, some customers will try and use as much as possible of it.

  5. Anonymous Coward
    Anonymous Coward

    Don't worry. Unlimited will come back, once the price drop and technology moves from relatively new to commonplace.

    Same thing has happened in Sweden, and I expect prices to drop and unlimited to return on 4G plans, in 2-5 years time.

    Just relax and let the market do its magic.

    1. Anonymous Coward
      Anonymous Coward

      Just relax and let the market do its magic.

      By which time 8G will be all the rage, maybe?

      Those free markets, and the little elven pixie creatures that make 'em work like magic.

      AC II

  6. Phil O'Sophical Silver badge
    Coat

    Not so much "unlimited"

    as "up to unlimited", then? Well, why didn't they just say so?

    1. Anonymous Coward
      Joke

      Re: Not so much "unlimited"

      It's not up to unlimited... I can prove mathematically that within a month I can only download a finite, limited number of packets.

      My download bandwidth in bits/packets is limited. Unless I assume infinite compression... ;)

  7. Gil Grissum

    And then, there are business customers who deploy thousands of mobile devices for use in the field who wonder why they are experiencing service interruptions when 500 people try to synch their devices all at the same time...

  8. xyz Silver badge

    well...

    The NSA isn't going to be happy with that! Think of all that lost intelligence if they start throttling (sic) Bin DownThePub and his mates.

  9. Tom 38

    Telco: Upgrade to 4G, its sooo fast you can watch a gazillion movies at once

    Punter: OK, sounds cool

    Telco: Stop watching a gazillion movies at once on 4G you utter drain on soceity

  10. Metrognome

    And yet...

    Swisscom proves that unlimited CAN be supported with quasi reasonable prices. (unlimited all you can use on net, landlines and mobes within and outside the country for around 90 gbp together with their equivalent iPlayer and catch up service).

    Why is it so hard for everyone else? Especially given that torrenting is officially and formally A-OK which would normally point to even higher usage.

    1. Anonymous Coward
      Anonymous Coward

      Re: And yet...

      > Why is it so hard for everyone else?

      Because, particularly in the US, communications systems are so fragmented with bizarre peering agreements based on everything *but* the reality of how things really work make it terminally broken.

      I see a great parallel with how health care is implemented. People whinge and whine about how expensive the NHS is, but you should see the waste and utter insanity of the equivalent in the US, all in the name of their version of the "free market". A typical tragedy of the commons scenario where no-one is even remotely concerned about the public good.

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