Data-bucket Plans Like Verizon's Will Take Adjustment for Carriers, Users
Carriers and subscribers have their eyes on the dollars and cents of multi-device data plans such as those set to launch at Verizon Wireless later this month, but for both sides, the new types of deals will also take some adjustment.
The "family" plans Verizon announced on Tuesday are different from any previous offerings, including existing family plans in which several users share voice minutes. They are designed for one or a group of subscribers to connect as many as 10 devices to the network using one limited pool of data, with unlimited voice and text. The subscription is associated with a person or family rather than a device, and it can encompass tablets, laptops, USB modems and other devices as well as phones.
That approach should make sense for users or families who shift their Internet use among devices. It brings consumers' relationship with a mobile operator closer to the home broadband model, in which Internet access is available to use however they choose rather than tied to a separate plan and bill for every device. Each of those devices has to be able to get on Verizon's network and there are monthly per-device charges, but it could make consumers more comfortable with putting various devices on the cellular network.
However, all this has implications both for back-end systems at carriers and for consumers' own management of their mobile use. "The concept is not completely foreign to operators, but doing it in data is a bit tricky," said analyst Chetan Sharma of Chetan Sharma Consulting.
A tricky part for both carriers and users is that it's possible for one user or device to burn up a data allotment much more quickly than a pool of voice minutes, "In a family, say, of four, one person can ruin the whole data plan," he said. "It does require users to be more conscious of what they're doing."
That means the right notification systems have to be in place to keep users posted on how much data they have left, he said. That might involve constantly sending updates to every person and device on the plan or just notifying the main subscriber in the family. The system could get more complicated still if a carrier wants to provide data-use tallies for individual users and devices. Some users in the plan, such as parents, may also want to get updates about how much others are using.
It could also be tricky to apply special policies to different family members under the same plan, said Joanne Steinberg, director of strategic marketing at mobile carrier management vendor Tekelec. For example, parents might want to restrict the kinds of apps that a child can use on his or her phone. Those policies are per user, not per account.
As a result, carriers offering these plans have to modify their OSS/BSS (operations support system/business support system) software and other systems. Specifically, they need to change the way their subscriber database talks to their policy server and their charging system, Steinberg said. Underneath a multi-user, multi-device plan, each user may still need an entry in the subscriber database. Whatever that user does is governed by individual policies but charged to the shared bill.
The new plan type also changes the way phone numbers relate to accounts, Sharma said. In traditional mobile plans, one phone number is linked to one subscriber and account. With bucket plans, multiple numbers and device identifiers have to be associated with a single account. That work can also be done in the OSS/BSS software, so the switches out on the network don't have to be updated, he said.
Rolling out multi-device plans shouldn't force carriers to rip out their back-end servers, but rather require changes to the software that runs on them, Sharma and Steinberg said. Carriers may use different vendors for each, which adds complexity, according to Steinberg. But there are standards for communication among such back-end systems, she added.
Reworking its management system may have taken Verizon some time, but that probably isn't why the new plans are coming out later than many people expected, they said. No other vendor offered them, so Verizon could wait, Sharma said. He thinks Verizon was first out with multi-device plans because it wants to catch up with AT&T on so-called "connected devices," most importantly the Apple iPad, which were available with AT&T radios about a year before they came out for Verizon with the iPad 2, he said.
Verizon wasn't available to comment for this story.
AT&T has said it is studying multi-device bucket plans and is expected to announce them soon. Mobile operators in other countries, including Rogers in Canada and SingTel in Singapore, already offer such plans, Steinberg at Tekelec said.