Recently Verizon posted an article on its website that attempts to make the case that unlimited wireless data plans are not necessary. It featured a disclaimer stating, “The thoughts, opinions and suggestions of the author may not necessarily reflect those of Verizon Wireless.” But it is self-serving.
So, here is a balanced rebuttal.
The article’s author, Jack Gold, does have some valid points. First, wireless connectivity has proven to be different from wired connections. Nearly everyone has experienced the frustration of slow wireless networks from too many people consuming mobile broadband at the same time. However, the argument that this is due to unlimited data plans is not valid. Most connectivity problems arise during select times of peak activity. Capping data penalizes everyone with limits that are in place all the time, instead of limiting consumption during peak times when there is more wireless traffic than the network can handle.
Second, the article explains that traffic jams will propel the carriers to upgrade their networks to manage increased capacity, and in turn will lead to price increases. While the author’s comparison of wireless networks to highways that need tolls to pay for more lanes to accommodate rush-hour traffic seems reasonable, the difference is that wireless carriers are profitable. AT&T, Verizon, and Sprint collected about $1.5 billion in overage fees last year, and according to an analysis by Ars Technica, data caps are more about profits than controlling congestion.
Finally, the author argues that subscribers “are very well served by current wireless data plans, and really don’t require more [data].” A recent Pew report contradicts this conclusion finding that nearly half of all mobile consumers frequently exceed their data caps, 30% on average. Data overage charges for most carriers are priced at about $15 per gigabyte used beyond the user’s plan.
Enterprise use of mobile broadband data differs from that of consumers, but the data cap woes remain. It is true that unlimited data plans are rarely necessary for ALL employees and consumers. However, for a select group of road warriors, unlimited data plans are required to get the best deal and avoid overage penalties. For these employees and consumers, fierce competition between providers for enterprise business is the best way to ensure that this option will be available – and that means unlimited data plans will continue have a place in the market.