Overstating Smartphone

Some people do use a lot of data. This month, Cisco Systems (CSCO) reported that the top 1 percent of wireless data customers account for 20 percent of traffic. In any other industry, this market segment would be called "loyal customers." Casinos call them "whales" and give them free hotel rooms and special tables with high limits. Wireless carriers punish their whales. Verizon has hinted that, like AT&T, it plans to move to tiered pricing later this year. Meanwhile, according to analyst Craig Moffett of AllianceBernstein (AB), AT&T is quietly letting some customers who used to have unlimited plans return to them. Carriers are playing two games of chicken simultaneously. First, among themselves: Each wants to earn more per customer by charging extra above a certain data limit, but none wants to be the first to do so. Second, with the rest of us: How low can they cap data without offending too many  chanel sunglasses 2011 customers? In other words, the bandwidth hogs are ruining it for everyone. It's a curious phrase, "bandwidth hogs." Executives at Comcast (CMCSA) used it earlier this decade to justify limiting traffic on file-sharing sites. This week several newspapers, writing about Verizon's decision, used the phrase "data hogs" in headlines. The phrase suggests a moral failing: the sin of gluttony. Wireless data is a finite resource. Data moves from a tower to a cell phone over electromagnetic spectrum, which carriers buy at auction from the federal government. Each carrier has a limited amount of spectrum, yet that limited amount renews itself, moment after moment. Think of electricity: The power plant runs all the time, but on hot days everyone turns on an air conditioner, straining the plant's capacity. Utilities are experimenting with smart meters that encourage customers to move their power use off-peak. Wireless power balance carriers, responding to a similar challenge, have chosen not to treat data like a commodity. Rather, they've carved off 5 percent of their heaviest users and stigmatized them. This is a business choice, not a natural economic consequence. Imagine that a power company, to prevent blackouts, has informed its customers that its heaviest users will be penalized with unpredictable brownouts two months running. Why do wireless customers tolerate this from carriers? It's hard to tell how much carriers pay wholesale to provide bandwidth to customers. According to John Hodulik, an analyst for UBS (UBS), "It's just not something the telcos discuss." A paper last year by Merrill Lynch (BAC) calculated $3 per gig and falling. (Verizon and AT&T declined to provide figures.) Thirty dollars for unlimited data: This is how Verizon Wireless beckoned AT&T (T) customers as it took orders for iPhone contracts on its network. Poor AT&T capped its data plans last year at $25 for two gigabytes; one gig is about the size of an episode of Glee in standard definition.

Verizon then said in a two-paragraph notice buried on its website that its network was a "shared resource" among its sunglasses online customers. It further sighed that it would have to slow data speeds for the top 5 percent of its users to save its customers from the "inordinate data consumption of just a few users."

Par eileen le jeudi 10 février 2011

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