The UK's 5-Minute 4G Data Cap

Barence writes "The tariffs have been announced for Britain's first 4G network and they include a data cap that customers will break within five minutes. EE's high-speed data service will start from £36 a month — or £21 a month SIM-only — although the lowest package's 500MB download limit might put data-focused early adopters off. With EE claiming average network speeds of up to 12Mbits/sec, that means users could theoretically exceed their cap in just over five minutes of full-speed downloads — or a little over ten seconds a day. There are no unlimited data deals."

Comments

Mobile bandwidth

[girlintraining]

So, guys... how's that whole "Let the market decide" argument working out for you? Capitalism works great for non-critical, non-infrastructure goods and services... but when it gets its hands on something everybody needs, it's gonna take you to the cleaners. Every single time.

Re:Mobile bandwidth

[Quakeulf]

Introduce competition.

Re:Mobile bandwidth

[Racemaniac]

because we've seen in the past that the "competitors" wouldn't ever dare to make deals to keep the prices artificially high

Re:Mobile bandwidth

[Phrogman]

Here in my part of Canada, there is no competition. Oh there are companies that are theoretically competing with each other, but they seem to have agreed that charging outrageous prices is working for all of them so why fuck with it. No one is offering cheap, efficient service to the masses. Competition does not work when the service or item in question is more or less essential, and the barriers to entry are significant.
The CRTC here in Canada just seems to rubberstamp what the industry tells them to do.

Re:Mobile bandwidth

[h4rr4r]

Do we have any evidence that competition in such fields works as it normally does?

Judging from the US mobile market I have to say it does not look likely.

Real competition would have to be regulated into existence. Force compatibility of technology and radios, force cross network compatibility and legislate costs for using other networks. We would probably also have to set a maximum subscriber count or region limits. Might even be easier to just make the actual gear owned by a non-profit and let the profit seeking enterprises act only as MVNOs.

Re:Mobile bandwidth

[h4rr4r]

In this case, UK English, tariff is not referring to a tax. The "tariff" is what americans would likely call a cell phone "plan".

Re:Mobile bandwidth

[MBGMorden]

While that works, part of the problem in modern society is the cost involved in starting up a competitive business. Most of the tenants of capitalism were thought up when the largest companies around would qualify as a small business by modern standards. The industrial revolution saw the rise of megacorps and the problem has continued to rise into the digital age. It costs a fortune to start a telecom company to compete with an existing one - not quite the same as wholesaling your apples for less than the competing cart next door.

What the solution is I'm not sure, but I think it will eventually have to involve government ownership of some of the very core services or at a minimum some rather strict regulation. We already have that with some things - where I live the power generation is handled by a government entity (Santee Cooper - a SC state agency), as is water and sewer services. Ambulance/911, law enforcement, and military are already handled by the government. Its just a matter of deeming telecommunications a critical public service.

Re:Mobile bandwidth

[Brannoncyll]

"The tariffs have been announced for Britain's first 4G network and they include a data cap"

I tend to agree that human life and welfare and critical infrastructure shouldn't be left to the ravages of greed but tariffs are normally levied by government not free market.

In the UK a 'tariff' in this context means what you guys would call a 'plan'. From Wikipedia: The word comes from the Italian word tariffa "list of prices, book of rates," which is derived from the Arabic ta'rif "to notify or announce."

Re:Mobile bandwidth

[girlintraining]

Introduce competition.

When a capitalist says this, it's a hand wave. They're dismissing cost of entry into the market. And let me explain to you why cost of entry matters in telecommunications (or for that matter, any infrastructure industry)... First, limited resources. You need access to land to run cables. If you're wireless, you need to negotiate for spectrum. Both are controlled by someone else. And the law says they don't have to sell to you at a competitive price -- or any price, for that matter. They choose whether you get in the door or not... and they may just choose to charge you an arm and a leg. Municipalities sign exclusive contracts saying only your competitor can run cables in that area for a period of 5, 10, 20, even 50 years. Why, you ask? Because those companies tell the municipality if they don't agree, they won't do business with them. "Too risky. Need to protect our investment," they say.

And then there's spectrum. It's not all equal -- and how well your network does wirelessly still depends on finding land to put your towers up. Again, exclusive contracts -- they'll fuck you every time. You can't just ask J. Random home owner to host your tower.. he'd probably love the income, but the government has zoning regulations... oh, and exclusive contracts.

In fact, in every case where capitalism has failed in an infrastructure capacity, it's for that reason: Exclusive contracts. Exclusive rights. Exclusive. Not inclusive. Inclusive means competition, and we don't want that. Exclusive means "protected investment"... and "protected investment" means... you, the consumer, are gonna pay a premium. Not them, not the guys who forced you down this road. You. Because their money is more special than other people's money. Their money has a government stamp of approval.

So the next time you hear a capitalist say "induce competition," remind them that they're the ones that asked for the exclusive contracts. Afterall, it's good business, right? And for them... it is.

Re:Mobile bandwidth

[Coisiche]

You're jumping to conclusions about a language you don't speak. In British English a tariff is a list or schedule of prices for such things as rail service, bus routes, and electrical usage (electrical tariff, etc.). I was unfamiliar with other uses of the word until seeing your comment and doing a 2 second google search to find that it also means a fee, not a tax, on imports or exports (trade tariff) in and out of a country, which I assume must be the main American English use of the word.

Re:Mobile bandwidth

[firex726]

Also considering the initial startup costs, just to break in would be very difficult.
Cell towers are not cheap, nor the network wot support them.

Re:Mobile bandwidth

[Dunbal]

Government/oligopoly partnerships working as designed. I see no problem here. If you keep complaining we'll just have to give you a little more indoctrination about how great "free markets" are. Of course you have never seen a real free market in your life, but that's besides the point.

Re:Mobile bandwidth

[alexgieg]

So the next time you hear a capitalist say "induce competition," remind them that they're the ones that asked for the exclusive contracts. Afterall, it's good business, right? And for them... it is.

Which is why capitalists neither vote nor support libertarian candidates, preferring to go with some of the big government parties, not caring much whether it's right or left-leaning. Libertarianism, with all that talk of deregulating markets, undoing legislation, removing trade barriers, eliminating subsidies etc. is quite scary for them. It's way, WAY easier to "make a deal" with a handful of high level bureaucrats and a few very friendly mega-corp CEOs, all working together to lock down the market into a de facto monopoly, than to deal directly with hundreds of millions of customers and thousands upon thousands of competitors.

Re:Mobile bandwidth

[vux984]

Rogers' best Internet plan is $130/mo. 250G of data.

I doubt you need 250GB of data on your phone per month, or even per year. I'm not saying you couldn't use it. I'm saying you don't need it.

You will exceed that in less than 5h at full speed.

7.5 hrs by my calcs, but even that is unlikely. I doubt the average user would be able to exceed that cap in under 24hrs even if they tried as getting maximum theoretical peak speed for a sustained 250GB burst is just not going to happen.

But that's beside the point. Mobile data caps on the top end plans is like those "free gas for a year" prizes. Its far more than enough gas for the average commuter in the average car.

But some slashdotter will cry foul because in a Veyron at 250mph driving 24hrs a day he'll be out of his "free gas for a year" in under a week.

Think of it as the networks are selling you 250GB/mo for $130, at the maximum speed they can deliver it, because that's the real deal on the table.

If you don't find that to be good value then don't buy it, but I'm curious how you rationalize that you should somehow be entitled to "all you can possibly consume", especially seeing as they haven't promised you 'unlimited' anything.

Re:Mobile bandwidth

[Phreakiture]

Reminds me of an amusing story.

In one area in rural upstate New York, just a few dozen miles outside of Albany, there was a small town where they wanted cell coverage, but nobody wanted to allow the tower to go up on their property.

Eventually, one local celebrity stepped forward and said enough was enough. He didn't need the income, and didn't (at the time) have a cell phone. He just was sick and tired of hearing about it. He had done well enough for himself and had plent of land in a good, high location and let them build a tower on it.

His name was Andy Rooney. Yes, that Andy Rooney

Re:Mobile bandwidth

[neokushan]

There is nothing artificial about a price that enough people will pay to make it worthwhile to the company providing the services/goods for sale.

Well that's utter crap for a start. I guess you're either not from the UK or simply haven't followed this whole debacle. The prices are high when compared to comparative 3G services - I pay £15 per month for an unlimited 3G service, but for £6 more (nearly a 50% markup) I can get a 4G service with a paltry 500mb of data. The only difference is 3G and 4G and guess what - there's several 3G providers and currently only one 4G provider. What a shock, their prices are over-inflated. It's not a case of "people paying what they're willing to", it's a case of people not having much choice - if you want faster data, you WILL have to pay just one provider and you will not have a choice about it. That might sound like a stupid thing to say, but there are plenty of people who don't have access to a decent fixed-line broadband service that would make good use of LTE.

The reason this all happened was because OFCOM allowed two huge mobile networks to combine and then allowed them to use "spare" spectrum for 4G - meanwhile, the rest of the mobile operators don't have spare capacity (and aren't allowed to use it for 4G anyway as it has already been allocated for 3G services) and have to wait and fight it out for a spectrum auction that has been delayed for years now (admittedly, this was somewhat self-inflicted but all the same - they shouldn't have greenlit EE to launch 4G this soon). EE will be the only 4G provider for about a year now and low and behold - inflated prices.

Why on earth would they charge less, anyway? No competition so no need. If you want 4G, you're stuck with them.

Re:ridiculous data caps

[Synerg1y]

netflix

Capitalism, or an un-critical consumer base?

[concealment]

Capitalism works great for non-critical, non-infrastructure goods and services... but when it gets its hands on something everybody needs, it's gonna take you to the cleaners.

While I'd love to blame an economic system for this, I feel the truth is more mundane: consumers are oblivious to what they are purchasing and are content to pay high prices for bad service.

Imagine if even 25% of the new phone buyers took a look at these plans and said, "Wow, that's a terrible option. I'm going to roll back to my old Nokia flip-phone and wait for industry to get its act together."

Yeah, well... they don't do that. They keep buying overpriced cable, ridiculous cell phone plans, Nickelback, lies by politicians, McRibs, etc.

The problem is that the consumers will deny themselves nothing, and if it's a bad deal, they just pass the buck along to someone else.

Re:Did anyone look at the cost of the plans?

[Cederic]

Considering I'm already a customer of EE paying less than that for unlimited data (constrained only by the 3G bandwidth), yes, I think the price is unreasonable.

£40 for unlimited and they'd have got me upgrading.
£30 for unlimited would be reasonable.
£36 for 500MB is laughable.