For months now, there has been a lot of buzz in the telecommunications industry regarding variable pricing plans for mobile data services. This continued to be a hot topic at CTIA Wireless 2009 in Las Vegas. Service providers such as Time Warner Cable, AT&T and Verizon are doing more than talking about it, and all seem to have their own opinions on tiered-pricing business models.

 

Recent media buzz:

 

Variable Pricing Coming to Mobile Broadband? – GigaOm

 

Capacity Crunch Likely to see Data Charged Based on Time of Day – Moconews

 

Year of Flat Rate Data – Wireless Week

 

What we know:

 

Data traffic over tier-one wireless networks is growing at 10-15% per month, with 1-2% of users generating up to 50% of the traffic. Demand for richer mobile content such as video – plus the popularity of high-end smartphones such as the iPhone, promises to further accelerate traffic growth – and operators need to protect their network infrastructure. Since carriers have finite resources, rapidly escalating data consumption poses a very serious threat to their operations, service quality and, ultimately, their revenue growth and profitability. To cope with the stress, operators are imposing data caps on users, with premium fees for excessive usage.

What we think:

 

Operators need to consider alternative solutions, including smart optimization and adaptive service control, in order to manage latency and maintain the stability, availability and scalability of their networks. By increasing network efficiency and capacity, they can manage the effects of continued traffic growth within the footprint of their existing installations and scale their networks ahead of rising data demand. This will also help to ensure a compelling user experience. By customizing data plans and controlling service levels, operators can enforce fair-use policies adaptively without damaging customer relationships.

 

-Stacey Infantino

Tags: mobile data, optimization, tiered-pricing

This entry was posted on Thursday, April 2nd, 2009 at 7:10 pm and is filed under mobile internet, variable broadband pricing. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.