Vodafone/Verizon lead 3G and MiFi deals

No escape from work - or freedom to go anywhere?

Verizon in the US (and Vodafone in the UK) are still offering the best deals on mobile broadband internet. As well as having the most reliable networks across the US, Verizon is the only major not currently planning to penalise customers for heavy data use.

Rival Sprint owned by Nextel Corp. in the US, says laptop customers using an excessive amount of mobile data while roaming could have their accounts temporarily suspended, though the carrier still doesn’t plan to limit the wireless connection for its high-volume smartphone customers.

US phone companies are competing with MiFi offers on the 3G spectrum, offering services which create a multi-computer wifi hot spot for up to five users.
Sprint is changing its policies for data service for laptops users with mobile broadband cards or USB modems, a spokesman said. The changes won’t apply to smartphones, he added. Sprint declined to break out how many customers are on one of the $59.99 monthly mobile broadband plan.

Sprint already has a cap of 5 gigabytes of data usage within the network, and 300 megabytes of roaming data. Starting July 11, excessive data roaming by mobile laptop users could lead to Sprint suspending the off-network service until the customer’s next billing cycle, unless the customer opts into a plan with extra charges for off-network usage.

Sprint will be able to notify broadband customers through a text message or e-mail when they hit 75% and 90% of the roaming data limit. The plans include 5 cents per megabyte on the Sprint network and 25 cents when roaming. The threat of suspension doesn’t apply to usage on Sprint’s 3G network or the 4G network run by partner Clearwire Corp.

The change follows AT&T Inc.’s move earlier this month to a tiered pricing structure for data, and T-Mobile USA’s decision to limit excessive use on its network. Analysts are expecting an industry-wide shift to control the amount of data traffic, which has grown fast enough to weigh on the quality of cellphone service.

Sprint’s peers have taken more direct action to address the issue of growing data traffic. T-Mobile USA, which is owned by Deutsche Telekom AG, said in April it would materially slow down users who had gone over 5 gigabytes of data within a month. AT&T opted to place caps of 200 megabytes and 2 gigabytes in exchange for lower monthly prices with extra fees if those limits are exceeded.

In the UK, the situation is complicated by the huge sums the networks paid for their bandwidth, plus the intense competition in a much smaller market. Vodafone has a better quality signal than Verizon but a less sophisticated technical offering – mobile broadband for a single computer. A dongle slots into the users laptop and offers 3G in cities and 2G in less built up areas.

O2 UK recent announcement that it will not sell new unlimited data plans as part of its smartphone bundles puts it back on a equal footing with Vodafone. Its partly a response of the arrival of the iPhone 4, to hold back an expected data surge among the data-heaviest smartphone users.

The potential breakthrough of video calls is especially likely to push nearly every operator to put lower limits on mobile data usage, reflecting how the drastically grown traffic has not generated new revenue in the same manner.

From 24 June, O2 will provide new and upgrading customers with three data bundles, which in terms of volume range from 500 MB to 1 GB. After the caps, an extra bundle of 500 MB will cost £5 (US$7.2).

Vodafone already scrapped its own fair use policy, capping the data traffic according to the handset type, with the 500 MB being the most common one. Although the unlimited offers have obviously had their limits also before, the industry appears to be moving to caps that are lower, stricter and more explicit, being added without the previous “soft caps” which usually did not include outright extra tariffs upon breaching the allowance. In short, all this reflects the way the mobile operators are struggling in accommodating the drastically growing data traffic, which is not generating enough revenue to allow the companies to meet the demand with adequate network investments.

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