Tiered Smartphone Data Plans Coming to U.S.

By now, you’ve probably seen that unlimited data plans on U.S. carriers are about to go the way of the dinosaur. Recently, Verizon’s CFO confirmed the inevitable:

We will probably need to change the design of our pricing where it will not be totally unlimited, flat rate.

This spawned a flurry of blog posts and struck fear in the hearts of smartphone users across the country. However, a piece in FastCompany takes a different view. Should someone who uses data casually be required to “buy” as much data as someone who streams movies all day and all night? That’s what flat rate data plans do. Presumably tiering data plans can result in fairer apportionment of the fees the carriers collect.

Dan Nosowitz, author of the article, points out that AT&T and other carriers are trying to have their cake and eat it too. They want to tier data plans which suggests that you pay for what you use, in a general sense. However, if you decide to use the same amount of data but divide it among multiple devices (i.e., tether your computer to your smartphone), you’re hit with additional fees. It is difficult to justify these tethering fees because tethering itself does not drive up the carrier’s expense.

I really like the FastCompany article but it misses one critical component. Consumers who want to stay in the lower data tiers can rely on Wifi signals to install apps and download massive files. Many home internet providers do not cap bandwidth and public Wifi is becoming widespread.

I tossed a picture of Sprint’s HTC Evo 4G at the top of this post for a reason. Sprint has a $10/mo. data surcharge (on top of the standard data charge) for the Evo. It was assumed that this charge related to the use of the 4G WiMax network. However, Evo owners who live nowhere near a 4G lit area are required to pay the surcharge. Official word eventually came out of Sprint that, basically, the Evo is so cool that Evo owners are more likely to use more data than other Sprint smartphone customers, even on a 3G network. In other words, Sprint is already trying to tier its data without officially saying so.

I wonder if people who have recently signed up for or renewed unlimited data contracts will be offered incentives to dump their existing contracts for tiered data plans. Early equipment upgrades? My pure guess is that we won’t see that but it’s an interesting possibility.

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