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The Odd Variations On 3G Per-Megabyte Pricing

Soulskill posted more than 3 years ago | from the taking-their-toll dept.

The Almighty Buck 205

GMGruman writes "Carriers are increasingly charging for 3G mobile access by the megabyte, to prevent 'unfair' subsidies of heavy users by everyone else. So why does the price of a 3G megabyte vary based on the device used to send or receive it? Why is an iPad megabyte cheaper than a MiFi one? After all, a megabyte is a megabyte as far as the network is concerned. InfoWorld has a comparison of 3G pricing for the four major US carriers for their various supported devices, so you can see whose 3G pricing is out of whack for which devices."

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205 comments

Fascinating (4, Insightful)

Ltap (1572175) | more than 3 years ago | (#34437396)

The best way to undermine a broken, corrupt system is to draw attention to the inconsistencies in its operation.

Re:Fascinating (5, Funny)

Monkeedude1212 (1560403) | more than 3 years ago | (#34437440)

The best way to undermine a broken, corrupt system is to draw attention to the inconsistencies in its operation.

Funny! That's also how my first marriage ended!

Re:Fascinating (1)

pesho (843750) | more than 3 years ago | (#34437646)

This is how telecom companies get to charge arbitrary rates under the guise of offering 'more choices for consumers'. They have practically put an 'abstraction layer' that makes it difficult for consumers to make decisions based on service and price.

Re:Fascinating (0)

Anonymous Coward | more than 3 years ago | (#34438238)

I've never seen them claim that's the reason, and according to TFA they decline to give a reason. To be honest, it's fairly reasonable to me from their perspective. They determine the market(s) they're looking to court, and tailor their plans to favor the devices desired by those markets. This is the free market at work and in my mind it's actually working here. Consumers have a variety of choices while the carriers still get to manage their networks as they see fit.

Re:Fascinating (4, Informative)

timeOday (582209) | more than 3 years ago | (#34438866)

Dilbert coined the term confusopoly [wikipedia.org] for this: "a group of companies with similar products who intentionally confuse customers instead of competing on price."

Obama advanced Elizabeth Warren for the new Consumer Financial Protection Bureau, and she has railed against this problem for years: "Today, the big banks churn out page after page of incomprehensible fine print to obscure the cost and risks of checking accounts, credit cards, mortgages and other financial products. The result is that consumers can't make direct product comparisons, markets aren't competitive, and costs are higher."

It's not hard to see the tie between confusopoly and the mortgage meltdown that wrecked the economy, either - and here I include not only under-educated sub-prime borrowers, but bankers creating and selling complex derivatives that were not well understood by ratings agencies, regulators, nor even the bankers themselves.

However, Republicans slammed [house.gov] the bill creating the CFPB as "a government takeover of the economy. The President and Democrats today gave financial regulators the power to create years worth of financial uncertainty, which will only lead to more struggling businesses and fewer jobs." Just as with the Credit Card Reform Act [findlaw.com] of 2009.

Re:Fascinating (1)

mattack2 (1165421) | more than 3 years ago | (#34437972)

Unfortunately, it hasn't worked for "The Daily Show". (That's one of the things that makes me mad watching the show -- they point out the inconsistencies/hypocrisy, with video clips, that the nightly news shows should be doing!)

Itsn't it sad when you get more relevant NEWS on (1)

crovira (10242) | more than 3 years ago | (#34438310)

Comedy Central [comedycentral.com] than on your so called newspaper/news show/news/broadcast. Suck to be you America...

Re:Itsn't it sad when you get more relevant NEWS o (1)

mujadaddy (1238164) | more than 3 years ago | (#34438672)

You're assuming two things:

1. That (300 million Americans) want or need information in their news, and

2. We can't afford to just wait for our international brethren to inform us we talk like fags and our shit is all retarded.

Re:Fascinating (0)

Anonymous Coward | more than 3 years ago | (#34438540)

Yeah, I guess this explains why AT&T has a hard-on for catching tethered iPhone users. Not only do they miss the base up-charge for tethering, but the data costs are like 18x's more expensive if you're using a laptop.

Profit! (0, Flamebait)

Pharmboy (216950) | more than 3 years ago | (#34437460)

Look, these are businesses which are in business to make a profit. No business sets their price based solely on cost of good. It is determined by supply and demand, what the market will bare, and what competitors are charging. If we start getting into telling businesses what to charge, according to OUR ideas of what is fair, well, that isn't capitalism. Don't like your carrier? Change. What we need to do is get rid of contracts and open up the marketplace, not tell companies what to charge.

Capitalism IS a self-correcting system. It isn't instantaneous, but given a level playing field, it is fair.

Re:Profit! (5, Insightful)

Monkeedude1212 (1560403) | more than 3 years ago | (#34437546)

What happens when all the carriers get together and say "I think a Megabyte is worth a dollar more?"

Re:Profit! (0)

Ltap (1572175) | more than 3 years ago | (#34437574)

We're seeing that now. This happens in retail, manufacturing, virtually every industry out there.

Re:Profit! (0)

Anonymous Coward | more than 3 years ago | (#34437580)

Then I open a new carrier charging less and run them all out of buisness.

Re:Profit! (0)

Anonymous Coward | more than 3 years ago | (#34437644)

In that case all other carries will act quickly to lower their rates before they loose any large chunk of customers or alternativley you just join them in price fixing and increase your revenue.

Re:Profit! (1)

lwsimon (724555) | more than 3 years ago | (#34437880)

If they lower their rates, then everyone is happy except the new guy, who goes out of business. If rates are raised again, someone else will try it, and down they come again.

If the new guy fixes prices, then he is vulnerable to the same issue - another new guy can undercut him severely.

Pricing is a raise to break-even. It's inescapable, without the influence of government.

Re:Profit! (1)

Qzukk (229616) | more than 3 years ago | (#34437998)

except the new guy, who goes out of business

And the banks and venture capitalists that fronted the money for this fool's errand.

If rates are raised again, someone else will try it

Good luck getting the banks and venture capitalists to front the money for the fool's errand the second time around.

Banks funding capitalist ventures? (1)

crovira (10242) | more than 3 years ago | (#34438608)

Whatever you're smoking, it must be illegal.

You can't even get banks to venture a loan backed by assets.

Corporations are sitting on billions in cash which explains what the banks are doing with the money. NOTHING!

They're paying themselves more interest on the money on hand and less interest on the cash reserves than ever before.

We have the idiots at the Fed to blame for that.

Their policy of fractional percentage DECREASES in the cost of borrowing the Fed's money by the major banks means that it doesn't pay for them to lend it out at all.

Re:Profit! (4, Insightful)

j-beda (85386) | more than 3 years ago | (#34438156)

Pricing is a raise to break-even. It's inescapable, without the influence of government.

And with the customer having perfect knowledge, and with all possible suppliers having equal access to capitol and no artificial barriers to entry into the market.

Of course with any finite system, without some form of regulation to prevent it, the entity with the control of the largest amount of capitol always "wins" in any multi-round commerce game. Once a monopoly grows, they can almost always maintain and expand it into other areas. If nobody else can raise enough money to build the towers, you cannot start a new cell phone company. And how can you convince a lender to lend to you if you plan on competing based on price against an already established player who can easily drop their prices until you go bankrupt? Yes, someone else could come along again to try to compete on price but they will have a tougher time finding a lender (the last lender lost their shirt remember?) and meanwhile the established player has more money than last time in order to temporarily "compete" with the newcomer.

Don't get me wrong - "artificial" intervention is very often harmful, but in my opinion is also very often necessary to provide the type of ecconomic environment we want to live in.

Re:Profit! (1)

Nevo (690791) | more than 3 years ago | (#34437678)

Antitrust lawsuits start flying.

Re:Profit! (1)

Amouth (879122) | more than 3 years ago | (#34437882)

and nothing of consequence happens from them..

the record industry got caught price fixing for a decade.. what happened? customers got leftover payola crap as a payout - and the they keep right on doing it.

the idea of free market means i should be able to come in and undercut them.. but MaBell is what you call too big to fight via startup.. and it doesn't help that even if you can fight them in the market place they are more than happy to get their in pocket politics to help their fight and make what ever you are doing wrong..

just take a look at Greenlight NC and the crap they are going through.

Re:Profit! (1)

Pharmboy (216950) | more than 3 years ago | (#34438554)

the record industry got caught price fixing for a decade.. what happened?

The internet happened, and now most music is "bought" for free. Again, the system isn't instantaneous, but just like karma, it tends to catch up with people.

Re:Profit! (2)

MobyDisk (75490) | more than 3 years ago | (#34437916)

That's called collusion and it is illegal in the US and EU.

So what's your point?... (1)

crovira (10242) | more than 3 years ago | (#34438680)

It might be illegal if you can prove it, but I'm sure that the heads of the corporations don't scribble it down or send it through email.

The amount of corporate espionage which occurs in any country is only partly funded by a desire to get the goods on the competition.

The rest is funded by a desire to maintain a profitable equality in pricing.

Re:Profit! (0)

Anonymous Coward | more than 3 years ago | (#34438286)

ahh, a good old fashioned conspiracy.

nothing of consequence will happen. It currently happens with the mpaa/riaa and nothing came from it. It happens with the oil companies but they use the futures market as an excuse to all set the same price. Retailers do it from time to time too, but usually it is more of, 'if i put this item at this price i'll let you put that item at that price without competing' sort of thing, so they rarely get caught. It happens with insurance companies too. And even worse: pharmaceuticals.

If large multinational corporations have taught us anything is that they are above the law. I dare you to do something about it.

Re:Profit! (4, Insightful)

h4rr4r (612664) | more than 3 years ago | (#34437572)

No, what we need is to standardize the technology used so customers can easily switch carriers, outlaw carrier locking of phones once the phone is paid for, and require carriers to sell transport to each other at reasonable rates. This would allow meaningful competition.

Re:Profit! (2)

freedumb2000 (966222) | more than 3 years ago | (#34437716)

In Germany a government body regulates the peering rates which recently moved from around 7c to around 3,4c a minute. Supposdly the rest of the E.U. charges similar rates. Does anything like that exist in the U.S.?

Re:Profit! (4, Informative)

h4rr4r (612664) | more than 3 years ago | (#34437804)

Not in the least.

Our system is totally to the benefit of the wireless carriers. We even have GSM and CDMA carriers to ensure that phone portability is as limited as possible. The only major carrier that offers to unlock phones once they are paid for is one you probably have heard of, T-Mobile.

When comparing regulation between two Germany and the USA it is always like this.

Re:Profit! (4, Informative)

puto (533470) | more than 3 years ago | (#34438194)

ATT has unlocked phones for years. All you had to do was well ask. I worked in tech support there until 2006 and we we used to process requests and send out unlock codes on daily basis. In 2009 I moved to south america, and called ATT and requested an unlock code for my Samsung Blackjack, and they sent it out to me in two days via email. And if you had an contract phone, and an account in good standing for at least 90 days, you could request and get an unlock code if you were going to travel abroad. The only phone you could not get an unlock code in recent history was the Iphone.

Re:Profit! (1)

h4rr4r (612664) | more than 3 years ago | (#34438252)

and get an unlock code if you were going to travel abroad.

T-mobile does not require you to be leaving the country to let you use your owned property with another carrier. Why does traveling abroad enter into it?

Out of fairness I will say my current carrier is verizon, and I will most likely be leaving them soon as they seem unwilling to have any flashable android devices nor moblin/meego on their network.

Re:Profit! (0)

Anonymous Coward | more than 3 years ago | (#34438560)

Yeah they seem great about unlocking phones if you ignore all the times they don't. You could apply the same logic to anything and come up with a favorable opinion.

It's not like the iphone has sold millions and is a non-trivial percentage of AT&Ts userbase or anything.

Re:Profit! (0)

Anonymous Coward | more than 3 years ago | (#34438220)

T-Mobile is Deutsche Telekom. You know, "deutsche", as in Deutscheland [wikipedia.org].

Re:Profit! (1)

h4rr4r (612664) | more than 3 years ago | (#34438456)

That was why I stated he had probably heard of it.

Thank you for adding nothing of value to the conversation.

Re:Profit! (0)

Anonymous Coward | more than 3 years ago | (#34438898)

I've been a t-mobile customer for more than 8 years. Only had a contract my first year. Not only do they have great customer service (really, they do) they also have some of the best rates. I especially like their solution to going over the 5 GB barrier. They slow you down instead of charging you a fortune.

I did once have a sizable overage charge when I was out in the boonies and didn't realize that t-mobile to t-mobile didn't count when roaming. Fair enough. That was more than 5 years ago.

It is worth noting that T-mobile is Deutsche Telekom (aka German Telecomm) which explains why they are the closest to the European model.

Re:Profit! (1)

AltairDusk (1757788) | more than 3 years ago | (#34438202)

This is about the only way I can see cellphones actually working as a free market. The market as it stands currently is broken.

Re:Profit! (2)

MBCook (132727) | more than 3 years ago | (#34437636)

Supply and demand doesn't work when supply is constrained by the government and one sided contracts lock demand so that it can't chose another supplier if being taken advantage of.

Capitalism IS a self-correcting system. It isn't instantaneous, but given a level playing field, it is fair.

Emphasis mine.

Re:Profit! (0)

Anonymous Coward | more than 3 years ago | (#34437650)

Look at the price it cost a consumer to send a single text message (and in a lot of cases the price it cost the consumer receiving the same text message) and compare with what the actual usage cost is, and then tell me if it is fair just because the telecom can set their own prices? Especially since all of them charge pretty much the same. There really isn't that much competition between them that is fair towards the consumers. Only fair to their extra high profits.

Re:Profit! (1)

BStroms (1875462) | more than 3 years ago | (#34437656)

I don't mind the contracts so much. You don't have to renew them when they're up (granted you'll be paying a monthly fee that's priced as if you had your phone subsidized.) And there are carriers out there that don't require any contracts at all, so you have options. What they really need to do is expand Wireless Local Number Portability. As it is, those of us who have moved out of our original Area Code are stuck with our carrier unless we want to go through the nightmare of changing our phone number.

Honestly, with more and more people ditching landlines and long distance calls becoming a thing of the past, I think we should get rid of region based area codes completely. Just give numbers to whoever wants them regardless of where they live.

Re:Profit! (1)

MoonBuggy (611105) | more than 3 years ago | (#34437986)

Just out of interest, how does having an area code from one place affect your use of the phone in another? I know US mobile phones have geographic area codes (as opposed to the UK ones which have a specific '07' area code prefix signifying mobile) but I thought it was just for administrative convenience?

Re:Profit! (1)

Sancho (17056) | more than 3 years ago | (#34438114)

You have to get new service using a geographically local area code, and you can't port your number to a new carrier unless your number is geographically local to you.

You can use Google Voice to maintain carrier neutrality (mostly) but that comes with its own set of headaches.

Re:Profit! (1)

hedwards (940851) | more than 3 years ago | (#34438232)

Area codes are just a geographic grouping of numbers. Those are the first 3 numbers following the 1 on a long distance call. The next 3 after that are the exchange and the last 4 are just to make it unique. One of the issues we have is that you can't be sure if a call is going to be long distance by looking at it. Around here both 206 and 425 can be local calls or they can be long distance as well depending upon the specifics.

There used to be a rough grouping by exchange, that doesn't seem to be the case any more. Trying to make much sense out of the numbers is largely futile as it isn't particularly orderly and the numbers aren't handed out by any particular single party. In a sense it's worse now than it used to be now that we've got telephone number portability, allowing you to take a phone number from one company to another.

If we had to do it over there's a few things which we would probably do differently, one of them is assign area codes in a way that roughly corresponds in some predictable way to the part of the country they're listed in. As it is, the 205, 206 and 207 area codes represent parts Alabama, Washington and Maine respectively. It would be difficult to find much more spread geographically for sequential numbers.

Re:Profit! (2)

h4rr4r (612664) | more than 3 years ago | (#34438498)

The correct way to do it would be by using something like DNS. That way the number behind it all could change and no one would have to know about it

Re:Profit! (2)

Sancho (17056) | more than 3 years ago | (#34438668)

If we had it to do all over again with today's technology.

Area codes (and prefixes) were allocated based upon population and with respect to rotary phones and mechanical switching equipment. Areas with high population got area codes with the most small numbers (except for 0) because on a rotary dial phone, shorter numbers means that the call can be connected more quickly. Connecting a call more quickly means that the switching equipment is tied up for less time. That is why 0 wasn't used as much--it's the last number on the rotary dial, and thus takes the longest to use. And since high-population areas are expected to be called more frequently, it made a great deal of sense to minimize the connection time to these places.

Re:Profit! (1)

0xdeadbeef (28836) | more than 3 years ago | (#34437670)

If we start getting into telling businesses what to charge, according to OUR ideas of what is fair, well, that isn't capitalism.

What we need to do is get rid of contracts and open up the marketplace

Who the fuck do you think you are, telling companies how to run their business? You'll get a contract and an oligopoly and you'll like it!

Re:Profit! (1)

Anonymous Coward | more than 3 years ago | (#34437696)

Sorry, you fail in your understanding of a free market system.

Any market where the exchange of some fungible good is restricted by artificial rules is not a free market. In this case bandwidth bought for device X cannot be transfered to device Y, or to person Z. This prevents price arbitrage and price discovery ensuring that the market price of the good remains under the control of the seller(s).

We don't need to tell companies what to charge. We need to tell them they don't get to set conditions to restrict the marketplace for their product! If I buy bandwidth I can use it however I want, with whatever device I want and I can resell it to whoever I want.

You have be brain washed into thinking that a consumer having a choice is the pinnacle of capitalism when that isn't even the most important of many necessary conditions.

Re:Profit! (2)

Pharmboy (216950) | more than 3 years ago | (#34437810)

You have be brain washed into thinking that a consumer having a choice is the pinnacle of capitalism

No, Mr. Knowitall, a free market is where those who are selling a good have equal access to the market place, ie: a level playing field in which to participate, like I said. /me thinks you spent too much time in college and not enough time actually owning and managing businesses.

Re:Profit! (1)

hackwrench (573697) | more than 3 years ago | (#34438116)

Sorry, you fail in your understanding of a free market system.

You say that and then use terms that someone who fails in their understanding woudn't be familiar with?

Re:Profit! (1)

MoonBuggy (611105) | more than 3 years ago | (#34437830)

It is determined by supply and demand, what the market will bare, and what competitors are charging.

Yes, and articles like this do an excellent job of informing the customers, thus altering what the market will bare and altering the price. Although setting the price of a commodity (and any unit of data within a given carrier's network is identical, even if data service in general is not precisely so) based on who's buying it and for what purpose might increase profits for a while, but it hurts the brand image once customers start finding out - that's a big part of the free market too.

If we start getting into telling businesses what to charge, according to OUR ideas of what is fair, well, that isn't capitalism.

Enforcing it by law isn't capitalism, but I don't see anyone suggesting that. Demanding it as customers is entirely reasonable - the companies don't have to listen, of course, but then the customer can follow your advice and change carrier.

Re:Profit! (1)

MozeeToby (1163751) | more than 3 years ago | (#34437862)

Supply: Cell network can support X Megabytes per second, at Y cost.
Demand: User asks for 1 Megabyte worth of data.

I don't see where what particular device I'm using to demand that data comes into play on the supply/demand curve. Maybe I'm missing it. The obvious exceptions would be if they are connecting to the network in different ways, LTE vs 3g for example.

Re:Profit! (1)

Pharmboy (216950) | more than 3 years ago | (#34438082)

I don't see where what particular device I'm using to demand that data comes into play on the supply/demand curve.

Yes, that is the problem, you don't see it. Demand isn't a two dimensional thing, nor is it calculated only by the MB. It is based upon the number of people wanting a very particular service vs. the ability of all the competition to provide it. It is modified further by raising prices on overages at whatever level they want to set, intentionally dampening demand to a level that is most profitable to serve. At that point, they adjust the supply to fit that demand.

Business is a lot more complicated than "I buy a widget for $1 and sell it for $2, I can spend $1 profit", particularly when you are talking about a cut throat multi-billion dollar industry that demands constant upgrading of equipment on a daily basis, and planning for the future with equipment that hasn't been invented yet.

Re:Profit! (1)

Sancho (17056) | more than 3 years ago | (#34438190)

It's just like with Cable/DSL. The provider oversells their pipes and charges based upon making a profit from the average user. They take a slight loss on the people who use loads of bandwidth, but make it up in spades on just about everyone else. The cost you see on your phone bill (e.g. $25/mo for a 5GB plan) is based upon the expected usage of smartphones (way less than 5GB.)

Laptops are expected to use more of the provisioned data, so the companies would be taking a loss on most laptop plans if they were billed at the same rate as the smartphone data plans.

Re:Profit! (2)

Maxo-Texas (864189) | more than 3 years ago | (#34437894)

Now that's even more ridiculous. Once again pretty females probably get the best rate.
First they can go into a club when they don't meet dress code, and now they get a bigger discount depending on what they bare.

Re:Profit! (1)

swb (14022) | more than 3 years ago | (#34438436)

What we need is a highly regulated (electric & gas utility style) monopoly that runs the towers & backhaul. They will sell their minutes at a tarrif-regulated price, in bulk, to the resellers who actually provide dial tone, voice mail, customer service and whatever other bullshit data features they want to sell (VZW Apps, media, etc).

In some ways it'd be like Apple's iPhone and the app store relative to AT&T -- Apple is the reseller of those items, AT&T kind of just provides backhaul for the apps.

Re:Profit! (1)

HeckRuler (1369601) | more than 3 years ago | (#34438464)

If we start getting into telling businesses what to charge, according to OUR ideas of what is fair. Don't like your carrier? Change. That IS capitalism

Fixed it for you. I think you meant to say "if the government starts getting into telling businesses..."
We the people, on the other hand, ARE exactly one half of the capitalism equation.

"given a level playing field" (1)

crovira (10242) | more than 3 years ago | (#34438500)

You must be kidding if you think that Rupert Murdoch (of Fox) isn't talking to Jef Zucker (of NBC) and Steve McPherson (who's now out so it might be Paul Lee) (of ABC) or Les Moonves (of CBS) and the rest of these media moguls when they get together in their conclaves in Aspen or Teluride or wherever the Hell they get together whenever the Hell they get together.

The phase "given a level playing field" shows a charming naiveté on you part which is astonishing given that you're posting on /.

Re:Profit! (3, Insightful)

sjames (1099) | more than 3 years ago | (#34438812)

However, according to the cult of the market, the "Invisible Hand" is supposed to push the retail cost down to the cost of production.

That tells us that the telecoms market is quite unhealthy in the U.S. OR that the theory of markets is wrong.

The problem has been around for as long as phones could actually use data and shows no signs of correction. If the market can't correct any faster than that, it's worthless.

Because (1, Insightful)

MrQuacker (1938262) | more than 3 years ago | (#34437488)

Because they can, and we let them. They are in it for the money, and this is a way to maximize it. While one flat rate set based on actual network costs + profit would be the most logical, thats never going to happen. The marketroids do not understand logic.

Re:Because (2)

natehoy (1608657) | more than 3 years ago | (#34438118)

Don't underestimate the marketroids. Most of them fully grasp that a flat rate would be more "logical" if their goal was to be fair. Their goal is not to be fair. Their goal is to extract the most money possible from you for the least possible cost. Making their plans simple and clear would be deeply, horribly illogical of them given their goal.

When I went to get my corporate Blackberry a couple of years ago, I had my choice of three models from Verizon and three from AT&T. Two of the models from each were equipped with GPS receivers and a bunch of nifty neato features. Both carriers claimed the phones were GPS-equipped. I did a little more research and my favorite Verizon model turned out to be delivered with the GPS locked to only their TeleNav service if you paid $10 a month.

I called a Verizon rep about this, and the conversation went sorta like this:

  Me: I understand that you lock the GPS on your Curve 8300 units, is that correct?
  Verizon Rep: Absolutely not! The GPS is fully available.
  Me: So, I could download Google Maps for Blackberry and I'd have my location shown?
  VR: Yes, location services are available in Google Maps. The location should calculate in seconds, and of course you need a data plan.
  Me: What? GPS doesn't use data unless you enable Assisted-GPS. Can I use non-Assisted mode in areas I don't get coverage?
  VR: No. You can't use the GPS with Google Maps, location services for that application are via cell triangulation.
  Me: But, why can't it use the GPS?
  VR: The GPS only works with TeleNav, our paid subscription service, which offers (blah blah blah more than Google Maps) all for only $10 a month.
  Me: So if I paid the $10 a month for TeleNav, I could use the GPS built into my Blackberry with any application I wanted?
  VR: Yes, I already said that location services are available to all applications.
  Me: Great, so I don't need any extra hardware to unlock the GPS, just the TeleNav subscription?
  VR: The GPS is not locked, sir. I told you that.
  Me: Allow me to rephrase that. I don't need any extra hardware to use the GPS receiver built into my Blackberry to use, say, Google Maps or Blackstar, assuming I pay the $10 TeleNav fee?
  VR: (sounding annoyed) Location services are availalable in all applications that support them.
  Me: GPS-accuracy location services? As in approximately three meter accuracy with a good view of the sky under ideal conditions?
  VR: (quite annoyed now) Of course you need extra hardware, you need an external bluetooth GPS puck to get the location from. We can sell you one with your phone for an extra $150.
  Me: So the GPS itself can only be used with TeleNav, and no other applications, and only if I purchase TeleNav, right?
  VR: (very piqued) I keep telling you, location services are available in all applications.
  Me: Just not using the built-in GPS.
  VR: Yes, the GPS works fine in all supported applications.
  Me: Can you name a few of those supported applications, please?
  VR: TeleNav.
  Me: Any others?
  VR: Location Services are available in Google Maps, Blackberry Maps, and a number of other...
  Me: (interrupting) Please stop talking about location services, I want to know about the Global Positioning Satellite Receiver hardware built into my phone. Can I use that hardware with Google Maps, Blackberry Maps, or any application other than TeleNav, even if I purchase the $10 a month TeleNav subscrip...
  VR: (interrupting) Of course not! The GPS is for TeleNav only. If you want a GPS of your own, you have to buy one. We won't just GIVE you one!

To me, this seemed a very illogical discussion. But to Verizon, this is a very logical conversation, because they wanted to get me into a two-year commitment with their phone so I'd be facing the decision of an extra $10 a month, or a $200 ETF, or a $150 external GPS puck. Any way you look at it, they win. They just needed to be careful to redirect the conversation to "location services".

Result: The GPS on my AT&T Curve works great with everything I've loaded on it.

And Verizon, to great fanfare (and in response to great customer ire), "unlocked" the GPS in the next firmware upgrade, "because your freedom is important to us".

Except it only works with Google Maps and Blackberry Maps, not Blackstar or geotagging pictures any of the other great applications I use my GPS for regularly.

Re:Because (1)

thePowerOfGrayskull (905905) | more than 3 years ago | (#34438628)

hey are in it for the money, and this is a way to maximize it. While one flat rate set based on actual network costs + profit would be the most logical, thats never going to happen. The marketroids do not understand logic.

They will charge what people are willing to pay, and that's the end of it. In that context, what they're doing is perfectly logical. Illogical would be charging a flat rate, when people would willingly pay premium rates for tiered pricing.

Re:Because (1)

mabhatter654 (561290) | more than 3 years ago | (#34438664)

the problem is not "one set fee". it's the ridiculous overage charges.

ATT's iPhone plan used to allow 5GB as "unlimited". Then they knocked $5 off the price and put a cap 60% of the original "product". THEN called it flexibility when they offered a 1/2 price plan with 5% of the data.

If ATT needed more money, they could have OFFERED more data for a higher price. You'll notice NONE of the bandwidth based operations do that. If service and data is (for example) $25 for 2GB, then why is the NEXT 2GB not "only" $20 more? That's how stuff in "real world" works. The ridiculous amounts like $1 per Megabyte (or $2000 for the same overage) is what the government needs to address. THAT is the real problem. The government also needs to address the fact that these companies charge amounts 100x the cost of a monthly bill with a straight face. If the company does a credit check, how can they justify those prices... throwing shit at a wall to see what sticks? Their whole model is built on low "monthly payments" then tricking people into using high profit items like information, overages, text-per-month charges, etc.

Re:Because (1)

Sancho (17056) | more than 3 years ago | (#34438924)

Actually, on AT&T, the next 2GB is only $20 more. Actually, they meter by the 1GB for overages, and 1GB is $10. So the first 2GB you have to buy at $25, and every 1GB after that is $10 extra.

With the smaller package, you simply pay $15 per 200MB. That's ... pretty astounding, frankly. I hover right around 200MB per month, and so it turns out that I probably would save money by being on the smaller plan--it would average out. However there's something to be said for feeling secure in the knowledge that an app doesn't start using tons of data, unbeknownst to me, and cause my bill to skyrocket.

the interesting page is that one : (5, Informative)

godrik (1287354) | more than 3 years ago | (#34437490)

that's the one that actually contain the table your are looking for.

http://www.infoworld.com/d/mobilize/the-strange-unpredictable-pricing-3g-data-plans-485?page=0,2 [infoworld.com]

Re:the interesting page is that one : (1)

SheeEttin (899897) | more than 3 years ago | (#34438370)

http://www.infoworld.com/d/mobilize/the-strange-unpredictable-pricing-3g-data-plans-485?page=0,2

Page (0,2)? We're paginating in two dimensions now?!

Not all megabytes cost the same (2, Informative)

Anonymous Coward | more than 3 years ago | (#34437492)

Transferring 1 1MiB chunk stresses the network a lot less than transferring 1024 1KiB chunks.

It makes sense to charge differently for devices with different usage patterns.

Re:Not all megabytes cost the same (2)

MrQuacker (1938262) | more than 3 years ago | (#34437852)

Ok, I am not a CS major, so please explain why that is? A packet is a packet, and all packets are the same size, no? If anything, transferring one 1MiB would take less packets because of the need for less routing overhead. The network "knows" that these X packets are all going to the same place. As opposed to sending 1024 1KiB packets, each of which needs routing appropriately.

Re:Not all megabytes cost the same (1)

SuricouRaven (1897204) | more than 3 years ago | (#34438072)

That's what he said. Well, most of the packets will be capped at 1500bytes for historical reasons. Sending 700 1500-byte packets is less demanding than 1024 1024-byte packets. Less demand on the routers, and timeslots are better utilised.

Voice goes seperatly in cells of 48 bytes for other historical reasons. The difference between a packet and a cell is the former is variably sized, while the latter is always exactly 48 bytes, no more, no less.

Re:Not all megabytes cost the same (1)

Nadaka (224565) | more than 3 years ago | (#34438124)

You must be a first year CS major.

No. Not all packets are the same size.

a single large packet has has a header that tells the network where it is supposed to go.
1024 small packets each have a header of about the same size as the header of the large packet, for over a thousand times the overhead cost just in terms of bandwidth.

Re:Not all megabytes cost the same (1)

Sancho (17056) | more than 3 years ago | (#34438326)

You two are in agreement. He said that 1 large chunk is easier to transfer than lots of small chunks.

A TCP packet has a minimum size of 64 bytes. That's with no payload (no real data beint sent.) If I have 1400 bytes that I want to send to someone, my device can choose to send 1400 65 byte packets (91000 bytes total including overhead, and not including acknowledgement packets.) It could also choose to send 1 1400 byte packet (1464 bytes, with the same caveats.) These are obviously the extreme cases--it could also choose a number somewhere in between.

Of course, it's a little worse than that. Some carriers meddle with the content you receive (most noticeable when they resize an image to make it smaller just before it hits the cell tower.) Sending lots of small packets means more work for that box, too, as it has to reassemble and keep track of more chunks.

Re:Not all megabytes cost the same (1)

c++0xFF (1758032) | more than 3 years ago | (#34438612)

But the usage patterns don't jive with their pricing.

I should preface this by saying that this is only a guess -- any rebuttals are welcome.

Let's start with web browsing. I'd say the usage pattern for each device is about the same, with the big difference being volume. The biggest difference would be for smartphones, which will have fewer large image files by visiting web sites optimized for a mobile device.

Next: email. I don't see a big difference here. Maybe fewer large files for smartphones and tablets by not downloading attachments.

How about streaming media? Movies and music will both come over in large packets, so the overhead should be minimal. I don't seen any significant difference between devices. But you're more likely to watch a movie on a tablet than the other devices.

What about apps? This is much harder to guess, but I would suppose that most mobile apps generally send lots of small packets, with an occasional large packet or two. That's what I'd expect from a game or weather app, at least.

So, I think it's clear that smartphones will tend to have smaller packets, on average, than the other devices. Doesn't this mean that smartphones stress the network more than the other devices? Shouldn't the price be higher for smartphones?

No, packet size is not the main factor here, even if I'm backwards in my thinking above. They charge different amounts because different devices are different markets. Even though the supply remains constant regardless of the device, the demand curves are very different. Why should we even expect the prices to be the same, then?

Tethering changes that. Allowing cell phone MBs to be used instead of USB modem MBs connects the two markets together and gives them the same demand curve. Everyone knows that the reason some carriers prevent tethering is because it prevents them from charging the premium for USB modem MBs.

21st century technology, 20th century mindset (1)

Pojut (1027544) | more than 3 years ago | (#34437498)

It's eerily similar to our patent laws, communication laws, and copyright laws.

UK - setup (4, Insightful)

ZERO1ZERO (948669) | more than 3 years ago | (#34437528)

What gets me, is they are double creaming you. You Pay for a limited amount of megabytes AND only for a time period! So with 3G dongles for example, you pay say £10 or £20 or £50 for maybe 1GB, 5GB and 'unlimited GB' - but they cap you in that this is for '30 days'. So if you dont use up your allowance in the time period, then you are shortchanged, as you have paid for it. Some people operate it the opposite way - you buy an amount it entitles you to 24 hours, 2 days, 7 days or a month etc so If you want to perhaps check your emails or what not when you are on business for a few days, you have to either pay over the odds each day or buy morethan you need.

Can they not just charge you for WHAT YOU USE, WHEN YOU USE IT. It's fucking retarded.

In terms of PAYG mobiles they dont have these problems

Re:UK - setup (3, Informative)

RotateLeftByte (797477) | more than 3 years ago | (#34437750)

Some UK PAYG Tariffs do have time limits on the period that the 'Top-Up' is vaild for, AFAIK, these are not from the main carriers but secondary networks that buy space on the main networks.

Back to Data Tariff's.
'3' has a contract £15.00/month for 15Gb. i use the same Sim in a 3G Dongle and in a 'mifi' unit. No problems with 1Mb 1Mb here.

Re:UK - setup (2)

Splab (574204) | more than 3 years ago | (#34437840)

Local areas may vary, but the company I work for charge you however you want it.

You can buy an allowance for the month, like most places - from $10 (1GB) to $30 (5 GB) - or you can pay $1 per MB.

The thing is - if we where to charge you the actual cost per MB traffic, it would be hugely expensive for you to get anything close to 1 GB (putting up towers and having xDSL in the boondocks is expensive, think avg. price pr. MB in the 20 cent range) - most people wont use more than 50-100MB, therefore we can lower the price for 1GB traffic and have all customers pay part of the tarif, while still giving people the ability to "spike" their usage without fear of huge bills. Yes this might seem unfair, but hey, that is how life works - we split the bill for highways, hospitals etc. even though we don't use it equally.

Re:UK - setup (0)

Anonymous Coward | more than 3 years ago | (#34438172)

Can they not just charge you for WHAT YOU USE, WHEN YOU USE IT.

They can and they do, if you want. Those are always by far the most expensive plans though, unless you transmit and receive only minuscule amounts of data.

It's fucking retarded.

If you say so. Personally I don't want to be nickel-and-dimed to death, least of all for an artificial and pointless metric like "transfer volume".

That's an easy one (4, Informative)

Minwee (522556) | more than 3 years ago | (#34437538)

So why does the price of a 3G megabyte vary based on the device used to send or receive it?

Because you keep paying it. Next question?

Not exactly (2)

grasshoppa (657393) | more than 3 years ago | (#34437594)

A megabyte is not equal to a megabyte, necessarily.

For instance, let's say I have a credit card processing server going across the same WAN link as web traffic ( for other workstations ). Obviously the web traffic is lower priority than the payment traffic.

As it applies to cell phones; maybe iphone users use their devices differently from other devices? Who knows, it's more likely cell phone companies bilking their customers ( as always ), but my point is that not all MBs are the same.

Re:Not exactly (1)

h4rr4r (612664) | more than 3 years ago | (#34437746)

So sell X GiB at Y QOS level. No per month, since that is just a scam. Either they get you with overages or you don't use it all and it expires.

Also Re:Not exactly (1)

medv4380 (1604309) | more than 3 years ago | (#34438228)

Also A lot of the different pricing comes from recoup costs for subsidizing the smart phone and tablet costs. The just do the math as we need to make up X for each customer who uses a smart phone because we give out Y number of smartphones at Z loss. Z/Number of estimated users = the amount we need to jack up the price. Some items cause them to loose more money then others like the little USB modem may cause them to loose more money and thus creates a different price system. 1 megabyte is the same no matter what but what device you use puts you in a different group of people that cost them money. Comes down to there is no such thing as a free phone. You'll pay in the cost of service if you actually get a free one and cost others who didn't because they don't charge them less for not participating in the annual commitment scam they charge them more to "encourage" them to join the cult of "free"

This isn't hard. (0)

Anonymous Coward | more than 3 years ago | (#34437710)

Why is a roll of toilet paper cheaper when I buy it in a pack of 12 than in a 4-pack? Why does Verizon charge me the same monthly rate whether I'm under contract or not? Because the price of items incorporates more information than relative production costs.

Correction, iPad 3G has commitment free pricing (1)

SuperKendall (25149) | more than 3 years ago | (#34437768)

In the article it states:

"Note that Sprint is the only carrier to offer tablet 3G service without requiring an ongoing commitment; you can start and stop whenever you want -- perfect for the occasional traveler."

But that is true of the iPad plan as well - you can start or stop whenever you like. The Samsung tablet does have that issue with Verizon, which has a fee for stopping service.

The networks want to maximise their profits (0)

Anonymous Coward | more than 3 years ago | (#34437770)

"Why is an iPad megabyte cheaper than a MiFi one? After all, a megabyte is a megabyte as far as the network is concerned"

http://en.wikipedia.org/wiki/Price_discrimination#Explanation

Re:The networks want to maximise their profits (1)

SuricouRaven (1897204) | more than 3 years ago | (#34438126)

I'm surprised the iPad plan isn't more expensive - anyone who can afford an iPad obviously has money to spare, while those on tighter budgets waited for cheaper tablets to become available.

Re:The networks want to maximise their profits (2)

Sancho (17056) | more than 3 years ago | (#34438810)

The iPad (with 3G) is pretty expensive. $630 minimum (but no contract on the data.) The Tab is only slightly less without a contract, but is sold subsidized for, what, about $400? Of course, forcing the data plan on you (and they are expensive) means that it's probably quite a bit more expensive in the long run.

Frankly, I think that Apple saw a new market that they could outright create, and they jumped at it. They own the tablet market right now because they did it first, they did it well, and they started with something familiar. Other companies had tried tablets before, but they didn't get all three of those right.

As for price, lots of people complained about the iPad pricing at first. There were claims that Apple had priced themselves way too high and that no significant number of iPads would be sold. Of course, those were vastly incorrect predictions, and what we're seeing now is that no one else can compete at the same price. They all have to take shortcuts somewhere.

That said, I'd argue that anyone who can buy a tablet has money to spare. They're still all toys right now. The only two that offer any reasonable performance are the Tab and the iPad, and they're still both pretty much consume-only devices. Yeah, John Gruber likes to point out that people are creating with the tablets--and that's certainly true--but the way most people create on most computing devices is by typing, and that's still far and away a better experience on a computer.

Because it subsidizes the phone cost (1)

MobyDisk (75490) | more than 3 years ago | (#34437964)

Part of the data plan's purpose is to subsidize the cost of the phone. That's why they won't let you buy a data-capable phone without the data service. There's no technical reason they can't, they just don't want you to get the discounted phone without paying them back for the discount.

The whole system is stupid. If cell phone providers sold cars, you would get the car for $50, but sign a multi-year agreement to buy gas from them at an inflated price.

Pricing doesn't work like that. (1)

Jasonv (156958) | more than 3 years ago | (#34438036)

They're priced different because pricing isn't based solely on the cost to the supplier. Demand, competition, perceived value, price discrimination, etc... all influence the price as well.

Premist is flawed (4, Insightful)

Mr. Freeman (933986) | more than 3 years ago | (#34438132)

"Carriers are increasingly charging for 3G mobile access by the megabyte, to prevent 'unfair' subsidies of heavy users by everyone else."

No, they're not charging more in order to make the network "fair" for everyone. They're charging more because they can get away with it because there are no real alternatives for anyone to switch to (especially with the 2-year contracts they're allowed to lock everyone into).
It's just that saying "We're charging more money because we're a company that's driven by making more money" doesn't go over as well as saying "We're charging more money to keep the network fair".

Peak hour pricing (1)

Ichijo (607641) | more than 3 years ago | (#34438306)

A megabyte at the hour of peak usage is worth much more than a megabyte in the wee hours. So one reason to charge more for megabytes from USB modems is because they are more likely to be used during business hours than iPhones.

It would be better to make the network completely device agnostic and instead have time-of-day per-megabyte pricing tiers, but that would add complexity.

Not Verizon Droid (1)

FredFredrickson (1177871) | more than 3 years ago | (#34438406)

I don't know how this fits in, but Verizon's driods require the unlimited droid dataplans. You can't buy it without the droid data plan. It's unlimited for aproximately $40/month. no cap. phone only (tethering costs extra unless you use barnacle)

How fast does it go? (1)

lionchild (581331) | more than 3 years ago | (#34438588)

And now with "4G" speeds, you can effectively use up a 5Gb alotment in a month in just over 30 minutes. At least in theory.

Managed network were not so bad (1)

scamper_22 (1073470) | more than 3 years ago | (#34438642)

I remember a while ago, when companies still offered unlimited internet plans... but they were throttling traffic. People made a big fuss about it.
Today, we see unlimited plans for internet and wireless are disappearing, overcharges are common...

The first thing to note of course is that a network (cell-phone or internet...) is not something to be characterized in such a simple manner as cost per MB. There is no cost per MB.
Costs for a network are basically the following

1. Infrastructure costs (routers, equipment, towers, license fees)... this is a fixed cost no matter how much traffic goes through.
2. peering costs. Most people are ignorant of this one... but the target location of your data actually matters. If your ISP is a small one, chances are they don't have a peering agreement with say ATT. So if the target location of your data is on the ATT network, your ISP might have to pay ATT transit charges.

Those are the only real 'costs' as it relates to the data itself.

Now how much traffic you can pipe through the system is a challenge... especially when it becomes congested. Just like almost any other network, it is not built for 100% of its users to be using 100% of their capacity 100% of the time. So you do face challenges 'managing' people's usage.

There are basically 2 ways to handle this. Note, these are totally arbitrary and need to be though of as separate from the real costs costs above.

1. Impose some artificial price to make users contain their usage. That is your per GB/MB charge. As this charge is not based on some true cost... it really is not a surprise that they impose different costs on different devices and plans... it is really just a deterrent to make you use less traffic.

2. Have the ISP 'manage' your usage. This is best known as throttling where companies would throttle the traffic of users. Maybe they slow down peer to peer traffic, or video traffic...

I am much more in favor of having ISPs manage their network rather than charging users directly. managing their network can actually produces a result people like. The ISP with the best management of its network for its users will win over more users. Users on poorly managed networks will complain that their video is slow or the p2p keeps dropping... They will switch to better managed networks.

There are of course problems with throttling... an ISP offerings its own phone service might start throttling VOIP service from competitors... Those are valid concerns of course. But that is nothing new. ISPs and wireless companies are monopolies to an extent and SHOULD always be investigated. Google is just being investigated by the EU for possible downgrading the links of its competitors.

My ideal throttling scheme goes like this.
You get unlimited usage. When congestion occurs, the ISP starts slowing down users based on their usage/plan. Want to be slowed down less... you purchase a more expensive 'GOLD' plan.

Now wireless is a bit different in that you actually need some kind of feedback between the cell phone provider and the cell phone. You can't just drop packets are the cell-phone provider level... the user will have already used the precious Over-the-air traffic before it is dropped. So for cell-phones they should have something where by the cell phone company can tell your phone to slow down its traffic. I don't know if this already exists BTW... I'm from the networking world, not the cell-phone world.

since both wireless and internet are somewhat monopolies... I really think the government should have a say in managing them. And quite frankly, forcing them to manage their own networks and stop these charges would be a welcome change.
It is not like a having a phone where you have to actively initiate a call... or actively make a long distance call. You know you are being charged and its a focussed activity. People really don't have the kind of immediate feedback as it relates to managing their internet / cell phone data use.This is even more true if you someone get infected with a bot or something.

that's just my little opinion. I know pricing can be a big influence... but I'm much more in favor of having the ISPs manage their network instead of imposing arbitrary overage fees that can easily be used to just milk users.

It's about expected use and willingness to pay (1)

proxima (165692) | more than 3 years ago | (#34438734)

The assumption, as best I can tell, is the same that drives carriers to charge $20/mo tethering fees for using smartphone data plans with a laptop. Basically, they don't expect you to use very much of your monthly plan.

The ipad+mifi deal from Verizon is another good example. If you want just a mifi (for, say, a laptop or an existing ipad), you pay $260 + $40/mo (contract) for 250MB or $60/mo for 5GB. If you buy it with an ipad, you pay only $130 for the mifi device and get the option to buy month-to-month $20 for 1GB, $30 for 3 GB or $50 for 5 GB. With the right usage pattern it wouldn't take long for the ipad to pay for itself.

Frankly, dedicated computer links (via USB or wireless) tend to have pretty lousy rates. Why? Because the carriers know these tend to be business customers (who have their companies pay for it) and they also tend to use more of their service than many smartphone users.

That said, provided they have the coverage you want, there are good alternatives to the standard ATT/Verizon choices. Virgin Mobile sells a mifi for $200 from Walmart with a $20/mo prepaid 1GB plan (if you buy direct from VM, it's cheaper but you only have the choice between $10/100MB or $40/unlimited). It uses Sprint's network (actually, Sprint bought Virgin Mobile USA last year).

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