Category: Mobile Phone Service

5G abstract

T-Mobile Expands Mid-Band 5G

Christian

T-Mobile just launched mid-band 5G in a bunch of cities. Here’s the key bit from the press release:

T-Mobile lit up a supercharged 5G experience in another 121 cities and towns with mid-band 5G, delivering up to gigabit-per-second peak speeds and average download speeds around 300 megabits-per-second for capable 5G devices.

The expansion into mid-band 5G is exciting. While T-Mobile has been destroying its competitors in terms of 5G coverage, T-Mobile has relied mostly on slow, low-band 5G.

Twitter sweepstakes

In the press release, T-Mobile mentions a sweepstakes to encourage Twitter users to discuss T-Mobile’s 5G:

To celebrate, T-Mobile is giving away $100,000 on Twitter over the next several months, with #5Gsfor5G.

Interestingly, T-Mobile’s President of Technology, Neville Ray, criticized this sort of thing in a Tweet he shared the same day the sweepstakes launched:

Most Verizon Subscribers Are On Unlimited Plans

Christian

On September 15, Hans Vestberg, Chairman & CEO of Verizon, had a public discussion with a Goldman Sachs analyst. A transcript of the conversation is available here.

One bit from the transcript stuck out to me:

Well over 50% of our customers are on unlimited. That means that the rest is on metered plan. That is also a way for us [last year] where we took the unlimited down to a basic unlimited in order to get our metered customers coming into unlimited because, ultimately, unlimited is unlimited. And then we start moving them up in the above and beyond unlimited, which will give you also the experience of 5G.

Two interesting points here:

  • Vestberg confirmed that unlimited plans dominate Verizon’s subscriber base. Since unlimited plans tend to be more expensive than metered plans, I expect the large majority of Verizon’s revenue from mobile subscriptions comes from unlimited plans.
  • Vestberg referenced the no-longer-offered Above Unlimited and Beyond Unlimited plans. I think he meant to reference Verizon’s current, premium plans (Play More Unlimited, Do More Unlimited, and Get More Unlimited).
AT&T Store

AT&T Introduces Mix-And-Match Program

Christian

Earlier this week, AT&T launched Unlimited Your Way. Customers on multi-line plans can now mix and match between AT&T’s primary plans. For example, a family with three lines can put one phone on AT&T’s Unlimited Starter plan, another phone on the Unlimited Extra plan, and a final phone on the Unlimited Elite plan. Before the program launched, AT&T required all lines on a multi-line account to use the same plan.

Pricing

It doesn’t look like AT&T has changed prices for accounts with 4 or fewer lines. AT&T has added a 5-line price to its website.1 The table below shows AT&T’s per-line pricing before taxes and fees and after a discount for enrolling in paperless billing and automatic payments.

LinesUnlimited EliteUnlimited ExtraUnlimited Starter
1$85$75$65
2$75$65$60
3$60$50$45
4$50$40$35
5$45$35$30

Reflections

Verizon has allowed customers to mix and match between its primary plans for years now. I’m glad to see AT&T copying Verizon’s policy. Since prices aren’t changing, I think the new program will be good for consumers.

What’s Going On With Smartwatch Plan Prices?

Christian 2 Comments

As far as I can tell, all eight carriers that support cellular service on Apple Watches have the same standard policy: service costs $10 per month. In general, watch service is only available as an add-on (e.g., stand-alone plans are not available), and carriers only offer the add-on to postpaid subscribers. Plans offered for other eSIM-based smartwatches generally follow the same $10 per month standard. Why?

Providing service for watches shouldn’t cost network operators much. Most people barely use data on their watches. Demands watches place on networks are minimal. The marginal cost for a network operator provisioning an eSIM should be close to $0.

In an open and frictionless market, I’d expect competition to drive down the price of smartwatch plans. For some reason, that isn’t happening (at least in the United States). I wonder if carriers that offer the Apple Watch have to agree to artificially keep watch service plans at $10 per month. However, it’s hard to square a policy like that with Verizon’s recent changes to some of its plans. Subscribers on Verizon’s Do More Unlimited and Get More Unlimited plans are now eligible for a discount that brings smartwatch service down to $5 per month.

I’m baffled. If you know what’s going on, please leave a comment.

Data Outage Affecting Some Mint Mobile Subscribers

Christian 3 Comments

A data outage has been affecting some Mint Mobile subscribers throughout the day. One of Mint’s co-founders, Rizwan Kassim, posted about the issue on Reddit:

An upstream error seems to have caused data provisioning errors for a number of subscribers.

It’s being worked, they don’t have a root cause yet, but I know this has been escalated. Down Detector showing issues on our carrier as well; not sure if it’s related or not.

I strongly think, but do not know, that this has nothing to do with the iOS 14 upgrade many of you installed today.

Based on reports I’ve read from Mint subscribers, the issue appears widespread geographically. I don’t know what proportion of Mint’s subscriber base is affected.

Kassim’s Reddit post suggests the issue may also be affecting T-Mobile. While Downdetector shows a slightly unusual level of issues associated with T-Mobile, I don’t think Downdetector’s data is consistent with a large-scale problem for T-Mobile subscribers.

I did a bit of my own digging for T-Mobile subscribers’ complaints about the networks’ performance today. I didn’t run into anything out of the ordinary.

Verizon Expands Connected Device Plans

Christian

Today, Verizon announced changes to its connected device plans. Verizon is now offering two add-on plans for mobile hotspots and tablets. Most subscribers on Verizon’s unlimited plans are eligible for the add-ons.

  • Unlimited – $20 per month
  • Unlimited Plus – $30 per month

Subscribers on the Do More Unlimited and Get More Unlimited plan can get a 50% discount on either plan.

Here’s a graphic from Verizon’s website:

While the graphic suggests there are two plans, I think its easier to make sense of the new offerings as four different plans:

  1. A $20 hotspot plan
  2. A $20 tablet plan
  3. A $30 hotspot plan
  4. A $30 tablet plan

Hotspot plans

The hotspot plans really shouldn’t be called “unlimited.” On the $20 plan, subscribers only have 15GB of regular-speed data. On the $30 plan, subscribers have 30GB of regular-speed data.

Verizon throttles customers that use all of their regular-speed data. I expect Verizon is sticking with its old policy of throttling to 600Kbps. At that speed, mobile hotspots lose most of their usefulness. I would find working on a laptop with a 600Kbps connection extremely frustrating.

Tablet plans

The tablet plans have limited allotments of “premium data” (15GB on the $20 plan and 30GB on the $30 plan). While subscribers have premium data available, they’ll have high-priority connections during periods of network congestion. After premium data allotments run out, subscribers may experience especially slow speeds if Verizon’s network becomes congested. Fortunately, congestion is rare in most areas.

5G

The Unlimited Plus plan includes unlimited 5G Ultra Wideband data on both tablets and hotspots.1 While that sounds great, it’s rarely meaningful in practice since Verizon’s 5G coverage is extremely limited. I’m guessing the unlimited 5G data will be dropped from the plan when Verizon’s 5G coverage expands and the 5G network becomes more congested.

Artificial Hotspot Limits

Christian

It’s common for cell phone plans to include limits on mobile hotspot data that are separate from limits on overall data use limit. E.g.,

  • Verizon’s Get More Unlimited offers unlimited regular data but caps mobile hotspot use at 30GB.
  • One of Mint Mobile’s plans comes with 35GB of regular data but caps mobile hotspot use at 5GB.

Recently, a Reddit user was confused about Mint’s policy and asked:

What’s the reason for the 5gb cap on the hotspot? I have a friend who this plan would be perfect for, however he tethers his iPad frequently to watch YouTube. Not sure what the big deal is since you could just switch the sim anyway.

Here’s how I responded:

My speculation:

Even though Mint allows 35GB of use, it knows the vast majority of subscribers won’t use that much data. If all subscribers used their full allotments, the plan would be much less profitable for Mint.

By restricting hotspot use, Mint reduces data use and (more importantly) dissuades some very heavy data users from ordering the plan in the first place.

I may not have that that exactly right. Mint’s arrangements with its host operator, T-Mobile, are not public knowledge. But the underlying logic is right. A gigabyte of mobile hotspot data isn’t more cost-intensive for a carrier than a gigabyte of on-device data.

Verizon Plans To Acquire Tracfone

Christian

This morning, Verizon announced plans to acquire Tracfone. The planned deal will involve an acquisition of the Tracfone brand and a bunch of subsidiary brands like Total Wireless, Straight Talk, and SafeLink.

At the moment, these brands have about 21 million subscribers. The deal is slated to be worth six or seven billion dollars (or about $300 per subscriber):1

The consideration for the transaction will include $3.125 billion in cash and $3.125 billion in Verizon common stock, subject to customary adjustments, at closing. The agreement also includes up to an additional $650 million in future cash consideration related to the achievement of certain performance measures and other commercial arrangements.

Along with the subscribers and brand names, Verizon is acquiring Tracfone’s roughly 850 employees and Tracfone’s retail presence in over 90,000 locations.2 Verizon expects the deal to close in the second half of 2021.

Reflections & open questions

Tracfone and Verizon will need to pass through some regulatory hoops before the deal is official. If the acquisition goes through, it will cause a massive shift in the industry. Tracfone’s user base makes up about 5% of the U.S. wireless market and a major share of the prepaid market.3

At this time, I’m guessing Verizon will continue to operate several Tracfone brands rather than consolidate Tracfone subscribers under the Verizon brand name.4 Years ago, a Verizon executive discussing Verizon’s lackluster number of prepaid subscribers stated the following:5

“Our retail prepaid is above market. We’re really not competitive in that environment for a whole host of reasons and it’s because we have to make sure that we don’t migrate our high-quality postpaid base over to a prepaid product…Quite honestly, we use the Tracfone brand as our prepaid product.

About 13 million of Tracfone’s subscribers already have service running over Verizon’s network.6 I don’t know what will happen to the 8 million subscribers on other networks. I’m guessing Verizon will try to transition most of them to the Verizon network, but Verizon may sell the subscribers to other carriers.

When the merger between Sprint and T-Mobile closed, I wrote:

I continue to think the merger is going to be bad for consumers over the long term.
I’m guessing the merger between Sprint and T-Mobile contributed to the viability of Verizon’s Tracfone acquisition. As with the merger, I’m not optimistic about the effects this new acquisition will have on consumers in the long term.

Unlimited Plans: A Race To The Bottom?

Christian

In the last few years, many cell phone carriers have released “unlimited” plans that actually have limits. Most of these plans are sufficient for the average person. Problems show up for a minority of cell phone users that are especially heavy data users.

Many people read my posts explaining the limits carriers place on their “unlimited” plans and react with a version of:

Ok, fine Chris. Sure these plans aren’t technically unlimited. But you’re being pedantic as hell. These plans are as-good-as-unlimited for 98% of people.

My pushback on “unlimited” plans isn’t about protecting heavy data users. In the long run, I’m worried that “unlimited” plans are part of a trend that will be harmful to a much larger group of people: light and moderate data users.

Huh?

This has happened before

For more than a decade, I’ve been following the portion of the web hosting industry that caters to personal websites and small-business websites. When I first started watching the industry, almost every web host offered a fixed number of gigabytes of bandwidth each month. Customers that wanted more bandwidth had to pay more. At some point, a few web hosts began offering “unlimited” bandwidth plans.

Of course, no web hosts actually offered unlimited bandwidth. Hosts put restrictions in their terms of service agreements that made it possible to shut down websites that hogged server resources. If Google had tried to host its infrastructure on a $10 per month “unlimited” plan, it would have been shut down instantly.1

Even though most websites are tiny and have modest resource demands, people running tiny websites tend to like the idea of having an unlimited plan. Since the internet has way more tiny websites than medium-sized websites, web hosts could allow some unprofitable, medium-sized clients to stick around. The hosting bills for tiny websites essentially subsidized some more popular websites.

Over a few years, it became clear that offering “unlimited” plans was a winning business strategy. Gradually, unlimited plans became the industry standard. Fixed-bandwidth plans faded away.2

Back to cellular

Fixed-data cell phone plans are fading in the U.S. market. Take a look at the websites of any of the Big 3 networks. Which plans do you see? Unlimited plans get the attention. Fixed-data plans still exist, but they’re buried.

It didn’t used to be this way. The move towards unlimited plans has been rapid and will probably continue until unlimited plans dominate the market. Unless regulatory bodies step in, I see only two ways this can play out in the long run. Both scenarios seem bad:

  • Unlimited plans without many restrictions become standard. Light data users essentially subsidize heavy data users.
  • “Unlimited” plans with significant restrictions become standard. We get a race to the bottom.

Racing to the bottom

When fixed-data plans dominated the market, customers were aware of the limitations they were likely to run into. Hell, plans were their limitations. A 5GB plan might have been named “The 5GB Plan”.

As unlimited plans have risen, limitations have been hidden from customers and tucked away in the fine print of legal documents. Plan names turned meaningless: “T-Mobile Magenta” and “Verizon Above Unlimited.”

Carriers place limits on their “unlimited” plans so they can compete on costs. Have you noticed the policies below on the rise?

  • Video throttling
  • Hotspot data throttled to slower speeds than regular data
  • Monthly hotspot allotments that have no relation to overall data allotments
  • Data transfer that’s restricted to sluggish speeds after subscribers use a certain amount of data

For network operators, it’s not important whether a gigabyte of data is used streaming video, loading web pages, or running a hotspot.3 All these policies have the same purpose: reducing subscribers’ data use.

Low-priority data is another common limitation thrown on plans. Subscribers with low-priority data will experience normal speeds when a network isn’t congested, but their speeds will turn sluggish when things get busy.

Limits aren’t the problem

I’m not broadly against limits. I’m against limits that confuse consumers. I’m against limits that aren’t explained clearly and prominently.

Unfortunately, unlimited plans attract the kinds of limits I oppose. At some level, it makes sense, at least from a business perspective. If a carrier downplays how serious the limits are on one of its plans, the plan will be more appealing to consumers.

Carriers throttling heavy data users to 128Kbps don’t make candid disclosures. Imagine what that would look like:

After 35GB per month of data use, download speeds will decrease to frustratingly slow speeds (around 128Kbps). You probably won’t want to use the internet at these speeds unless you really need to. But if you have to load a boarding pass or an email after you’re out of regular data, you should be able to with a bit of patience!

No. We get vague disclosures like:

Data speeds reduce after 35GB but data is unlimited.4

Plans with low-priority data will have fine print mentioning reduced speeds during congestion, but details will be sparse. Customers trying to figure out how common congestion is, where congestion tends to occur, or how much speeds are slowed aren’t going to find the information they’re looking for.

Hell, it’s not just regular consumers that get confused and misled. My favorite tech review site can’t sort out prioritization policies. Here’s a bit from Wirecutter:

A T-Mobile spokesperson confirmed that policy, saying that although postpaid and prepaid T-Mobile service have the same priority, Metro by T-Mobile and other resellers ‘may notice slower speeds in times of network congestion’…However, AT&T and Verizon told us that they don’t impose any such prioritization.

Perhaps the scariest part of the excerpt is not that Wirecutter is wrong, but that people speaking for AT&T and Verizon were wrong about their own companies’ policies.

Where will we end up?

If nothing changes, we’ll continue to see the low-cost side of the market (a) throw more limitations on plans and (b) bury limitations deeper. In my view, the problem isn’t evil carriers. It’s bad incentives. Maybe the FCC or the NAD (National Advertising Division) will jump in and change carriers’ incentives. I’m not too optimistic, though.

RootMetrics’ Early 2020 Report

Christian

Earlier this week, RootMetrics released its report on cellular networks’ performance in the U.S. in the first half of 2020. The most recent round of RootMetrics’ testing got screwed up by the pandemic, but the company did its best to publish something that followed the structure of its usual reports.

While I continue to think RootMetrics has the best methodology of any network evaluator, I’m not going to discuss the latest results in detail. For the most part, the results were as expected and similar to what RootMetrics found in its previous round of testing.

Highlights

As usual, Verizon was the big winner:

Verizon continued its run of excellence in our national testing, winning or sharing six out of seven awards.

AT&T showed solid performance and easily took the second spot for overall performance. AT&T managed to beat Verizon on RootMetrics’ speed score.

While Sprint is gradually disappearing, RootMetrics included the in its testing. Oddly enough, Sprint’s overall score beat T-Mobile’s score.