Smartphone Data Shake-Up: The End of 'Unlimited' Plans

Heavy users and the future of 'unlimited'

Smartphone Data Shake-Up: The End of 'Unlimited' Plans
But wait: Not everyone is "normal." While the average user may stay safely within the 2GB-to-3GB range, there are people who regularly use enough data to blow past those levels -- and they certainly pay the price.

Whether it's shelling out $50 to $80 for a higher-tier plan or paying $10 for every gig over your limit (or, in the case of T-Mobile, suffering dial-up-like speeds once you pass your monthly limit), the move toward limited data is definitely bad news for the nation's small number of heavy data users.

How small of a number are we talking about? According to an analysis conducted by Nielsen in the first quarter of 2011, only the 97th percentile -- the top 3% of all smartphone users -- exceeded 2GB of smartphone data usage per month. Within that subset of users, however, the level of consumption is huge: For example, the top 1% of users devour a hefty 4.5GB of mobile data every month, according to Nielsen's measurements.

"The carriers designed these plans so that 95% of customers fall into a reasonable tier, and the people that are really using data heavily end up having their behavior modified through their wallets," Entner says.

It isn't only the most extreme cases that result in hefty fees, though. Just ask Thomas Brewer, a medical billing specialist who uses his phone for Web browsing, music streaming and the occasional Netflix video. Brewer says he passes his 2GB limit with Verizon almost every month, usually by a matter of mere megabytes.

"The most I've had to pay so far is about $25 over my usual bill," Brewer says.

Robert Finley, a software engineer who likes listening to podcasts on his phone, recently upgraded to a high-tier plan in order to save himself a headache. Though Finley has never actually gotten a penalty from his carrier, he grew tired of nervously watching over his shoulder to make sure he didn't exceed his cap.

"It made me very guarded in my use of data and was directly counter to the cloud-based direction of the industry," Finley says. "It creates a climate of being a bit afraid of your device. Given the choice, there is no question I would always like an unlimited plan, even if it costs slightly more."

Some analysts think that type of mindset will eventually help usher unlimited options back into our lives. Entner, for one, believes a lot of Americans would opt to pay more for an unlimited plan, even if they didn't need one -- and that carriers will ultimately respond to that demand.

"For the consumer, an unlimited data plan gives them certainty," Entner says. U.S. consumers are "risk-averse, like predictability and don't mind overbuying," he adds. "Give it three to five years and we'll be back to unlimited data."

Data-saving tips
  • For now, unless you go with Sprint and its $40 unlimited offering, all you can do is make the best of the tiered data plans that are available. The good news is that you can take steps such as these to keep your mobile data usage in check:
  • Use Wi-Fi whenever you can. At the office? At home? Toggle your phone's Wi-Fi mode on, and you'll avoid unnecessary 3G/4G network usage. Do the same in the ever-increasing number of public places with free Wi-Fi, such as retail stores and coffee shops. Just remember to be extra cautious about security when connecting to any unencrypted public network.
  • If you use an Android device, there are several apps that can automate the process of accessing Wi-Fi networks; they'll switch your phone's Wi-Fi on when you enter certain locations and turn it off when you head out. I like Tasker, which is available for $6.49 in the Android Market. Setting Profiles, which costs $3.99, is another good (though less robust) option.
  • Watch your background data consumption. A lot of apps, ranging from social media programs to news-reading utilities, check into cloud-based services to look for new updates during the day. Find the background data settings for relevant apps (depending on your phone's OS, the settings may be in the individual apps themselves or in the main system settings menu) and disable or dial back the settings on things you don't need. After all, if your phone polls Facebook for new messages every 15 minutes, that activity can add up over the course of a month.
  • Set limits on your mobile data. Smartphones are getting smarter about helping you track and control how much data you use. Android has an integrated data management tool in its Ice Cream Sandwich (4.0) release that allows you to view and restrict each app's data usage, set warnings based on your overall data usage, and even set a cutoff point after which your phone will stop using mobile data altogether until your billing cycle resets.
  • You can find third-party programs that will perform some of those functions for both Android and iOS. If you're using a pre-Ice Cream Sandwich phone, try My Data Manager Free; if you're using an iPhone, look for DataMan Free. Both apps provide basic monitoring and alerting services for your mobile data usage.

For comprehensive coverage of the Android ecosystem, visit Greenbot.com.

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