Mobile data plans are in the midst of a change that may come as a shock to customers across the U.S. Unlimited mobile data plans are quietly fading into the night and phone carriers (or uncarriers) like T-Mobile hope no one is watching. In a price slashing war, T-Mobile and AT&T have both recently performed major price cuts to their tiered services. While this may have some customers rejoicing, they should realize that the market is about to give them less for their money.
T-Mobile, the underdog of the American market, looked like the hero recently announcing an increase in their mobile data plans allotment while making price cuts. But if customers read and listen carefully, they will see that the mobile data plans are not receiving more for less. In reality, T-Mobile is trying to deal with the massive influx of customers through their uncarrier advertising which has put more stress on their 4G LTE network. More stress on their network means slower speeds, higher costs, and the danger of alienating customers. AT&T and Verizon, the phone carriers with the most popular mobile data plans, gave up on unlimited data years ago because of these reasons.
Market analysts and competitors, like SoftBank CEO Masayoshi Son, believe what has developed in the U.S. is a shame and is creating an American market place that lags behind when it comes to mobile data plans. Son, whose SoftBank own Sprint, is interested in purchasing T-Mobile to increase the speed of their mobile data plans and implement larger price cuts across the board. The reality is, the data plans in the U.S. are slower and more expensive than any other major country in the world.
“The mobile Internet, the Internet highway, is the most important infrastructure for the 21st century,” Son said during an interview. “We would like to make the deal happen.”
Because the U.S. competition is only between the big four for mobile data plans, there is very little pressure to improve speeds. Interestingly, many customers pay for the LTE network, but tend to use a wireless internet connection whenever possible. The iPhone from Apple is the greatest culprit for draining 4G LTE networks, still outpacing every other smartphone for data usage. In fact, the iPhone 5s uses more data than any current tablet on the market.
So while T-Mobile gets a pat on the back for savvy marketing and creating a tiered pricing structure that allows customers to choose what they want, customers should remember that the death of unlimited data is coming. Mobile data plans in the future will increasingly become an a la carte style, throttling speeds after a certain amount of usage.
[Image via Phandroid]