Bandwidth Usage: Fair usage policy

Most ‘unlimited’ broadband plans today in India have incorporated ‘fair usage limit’. Even though I have an unlimited data transfer on my Airtel broadband, the speed reduces to 256K the moment the usage crosses 10 GB. With a teenager at home hitting the 10 GB is not at all difficult, month on month!

I received a promotional email from Airtel, the subject of which said “Pay Rs 100 more, upgrade for unlimited 2GB plan”. Sounds very economical. The body of the email was blank. But I did not give up, I responded to Airtel, the corporate office got involved. Tons of emails were exchanged and I was told by the corporate office “It is actually Rs 150 more and after 20GB the speed reduces to 256K”. I asked them to go ahead with the change of plan.

After few days Airtel called me to say the limit was 10 GB and not 20 GB. I did not bother to upgrade, I did not see how it would help me with data limit being the same as my current plan.

In February I read about fair usage policy on mobile networks in the US. Few points were,

  • US mobile networks started with unlimited data, later capped the plans to 2 GB (the size of a TV episode, even though I would never strain my already strained eyes by watching TV serials on a phone)
  • Wireless data is a finite resource. Data moves from a tower to a cell phone over electromagnetic spectrum. Each carrier has a limited amount of spectrum, yet that limited amount renews itself, moment after moment.
  • Cisco Systems reported that the top 1 percent of wireless data customers account for 20 percent of traffic. In any other industry, this market segment would be called “loyal customers.” Casinos call them “whales” and give them free hotel rooms and special tables with high limits. Wireless carriers punish their whales.
  • Each mobile network to earn more per customer by charging extra above a certain data limit, but none wants to be the first to do so.
  • Mobile networks pay $3 per gig. And in turn charge their customers $15 for 0.2 gig ($75 per gig). That’s a 2,500 percent markup over the cost of goods.
  • As traffic increases on mobile networks—it nearly tripled in 2010, and Cisco expects it to grow twenty-sixfold by 2015—consumers will be forced to make smarter choices about how they use mobile data.

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