The Odd Variations On 3G Per-Megabyte Pricing

GMGruman writes "Carriers are increasingly charging for 3G mobile access by the megabyte, to prevent 'unfair' subsidies of heavy users by everyone else. So why does the price of a 3G megabyte vary based on the device used to send or receive it? Why is an iPad megabyte cheaper than a MiFi one? After all, a megabyte is a megabyte as far as the network is concerned. InfoWorld has a comparison of 3G pricing for the four major US carriers for their various supported devices, so you can see whose 3G pricing is out of whack for which devices."

Fascinating

[Ltap]

The best way to undermine a broken, corrupt system is to draw attention to the inconsistencies in its operation.

Because

[MrQuacker]

Because they can, and we let them. They are in it for the money, and this is a way to maximize it. While one flat rate set based on actual network costs + profit would be the most logical, thats never going to happen. The marketroids do not understand logic.

UK - setup

[ZERO1ZERO]

What gets me, is they are double creaming you. You Pay for a limited amount of megabytes AND only for a time period! So with 3G dongles for example, you pay say £10 or £20 or £50 for maybe 1GB, 5GB and 'unlimited GB' - but they cap you in that this is for '30 days'. So if you dont use up your allowance in the time period, then you are shortchanged, as you have paid for it. Some people operate it the opposite way - you buy an amount it entitles you to 24 hours, 2 days, 7 days or a month etc so If you want to perhaps check your emails or what not when you are on business for a few days, you have to either pay over the odds each day or buy morethan you need.

Can they not just charge you for WHAT YOU USE, WHEN YOU USE IT. It's fucking retarded.

In terms of PAYG mobiles they dont have these problems

Re:Profit!

[Monkeedude1212]

What happens when all the carriers get together and say "I think a Megabyte is worth a dollar more?"

Re:Profit!

[h4rr4r]

No, what we need is to standardize the technology used so customers can easily switch carriers, outlaw carrier locking of phones once the phone is paid for, and require carriers to sell transport to each other at reasonable rates. This would allow meaningful competition.

Premist is flawed

[Mr. Freeman]

"Carriers are increasingly charging for 3G mobile access by the megabyte, to prevent 'unfair' subsidies of heavy users by everyone else."

No, they're not charging more in order to make the network "fair" for everyone. They're charging more because they can get away with it because there are no real alternatives for anyone to switch to (especially with the 2-year contracts they're allowed to lock everyone into).
It's just that saying "We're charging more money because we're a company that's driven by making more money" doesn't go over as well as saying "We're charging more money to keep the network fair".

Re:Profit!

[j-beda]

Pricing is a raise to break-even. It's inescapable, without the influence of government.

And with the customer having perfect knowledge, and with all possible suppliers having equal access to capitol and no artificial barriers to entry into the market.

Of course with any finite system, without some form of regulation to prevent it, the entity with the control of the largest amount of capitol always "wins" in any multi-round commerce game. Once a monopoly grows, they can almost always maintain and expand it into other areas. If nobody else can raise enough money to build the towers, you cannot start a new cell phone company. And how can you convince a lender to lend to you if you plan on competing based on price against an already established player who can easily drop their prices until you go bankrupt? Yes, someone else could come along again to try to compete on price but they will have a tougher time finding a lender (the last lender lost their shirt remember?) and meanwhile the established player has more money than last time in order to temporarily "compete" with the newcomer.

Don't get me wrong - "artificial" intervention is very often harmful, but in my opinion is also very often necessary to provide the type of ecconomic environment we want to live in.

Re:Profit!

[sjames]

However, according to the cult of the market, the "Invisible Hand" is supposed to push the retail cost down to the cost of production.

That tells us that the telecoms market is quite unhealthy in the U.S. OR that the theory of markets is wrong.

The problem has been around for as long as phones could actually use data and shows no signs of correction. If the market can't correct any faster than that, it's worthless.