Mythbuster: Why unlimited data throttling may be pointless

New research finds top unlimited and tiered wireless usersconsume virtually the same amount of bandwidth.

Well this is interesting: New research by Validas, a companythat analyzes wireless phone bills, found that there is barely any differencein the data usage habits of the top 5 percent of tiered and unlimited wirelessusers. This comes after three of the four major US wireless carriers have begunto throttle speeds for those so-called “data hogs” on unlimited plans. What thefindings potentially uncover is that the new policies are ostensibly less aboutthe initial justifications for the limits — esoteric concerns over networkbandwidth and wireless spectrum shortage, of which AT&T specificallyreferred to as an impetus for their policy shift — and more about moving legacyunlimited data plan holders to more modern, tiered contracts.

Validas, which according to their website, “cuts through theconfusion that wireless bills and rate plans create to get consumers,businesses, and government agencies more from every dollar they spend onwireless services,” analyzed data extracted from a sample of over 55,000 2011mobile phone bills. What they found was perhaps contrary to common sense: OnVerizon Wireless, for example, the top 5 percent of unlimited data plan holdersused an average 3.57 GB of network bandwidth, and a median of 2.60 GB per 30day period. Tiered plan holders used on average 3.59 GB with a median of 2.58GB, representing no appreciable difference. AT&T’s results skewed a bitmore towards conventional wisdom, with the average top unlimited data subscriberusing 3.97 GB vs. the tiered user’s 3.19 GB, a spread of about 25 percent. Thedifference, however, could involve AT&T’s faster 4G data network, inrelation to Verizon’s slightly slower, but more widespread LTE service.

Of the four major wireless carriers, unlimited datathrottling policies differ in a few distinct and important ways. T-Mobile,according to a blog post on Validas’ website, “is very transparently throttlingover 5GB of data used, which corresponds to a very small portion of users. VerizonWireless and AT&T, on the other hand, are utilizing active throttlingtechniques aimed at the top 5 percent (in terms of the amount of data used) ofunlimited customers.” The post goes on to indicate that Verizon will reducespeeds for its throttled users for as little time as possible and based onparticular regional network loads, a metric that is constantly changing.AT&T is a bit more punitive in its data control, heavily throttling topunlimited users for the rest of their billing cycle. Conspicuously absent fromthe major carriers throttling unlimited data is Sprint. They offer a “trulyunlimited” data plan that, barring some recent controversy, seems to beauthentically unlimited.

What is clear from these statistics is that data throttlingof unlimited customers is a preemptive tactic being employed by the largestwireless carriers at the very least to protect against future wireless spectrumneeds. To that end, it is disingenuous for AT&T and Verizon to bill thechanges disguised as an immediate threat to consumer data traffic. We need lookno further than T-Mobile, the nation’s fourth largest carrier and one in direneed of wireless spectrum — its own policy could hardly even be consideredthrottling compared to Verizon, which currently has more spectrum than itsurely knows what to do with. What’s more likely is that as carriers move tofaster, and thus higher bandwidth 4G networks and beyond, unlimited data planholders will begin to realize a significant advantage over tiered users, presentinga potential liability for carriers. Although 40 percent of Verizon Wirelesssmartphone users consumed less than 50 MB a month in 2011, those numbers areexpected to change drastically as 4G networks become more prevalent; drivingunlimited customers to tiered plans right now presents much less challenge towireless carriers than when mobile users start to get used to truly unlimitedbandwidth. If you keep track of how much data you normally use, let us know inthe comments.