The 5 GB cap is upsetting.
Because there’s money to be made. But, greed (yes, greed) has kept mobile broadband companies from seeing it.
Allow me to explain.
Mobile broadband carriers usually give the following statement (or some variation of it) as the reason for having usage caps:
"1% use the majority of bandwidth making it difficult to provide service for normal users"
In the ‘defense’ of other users, they deem it necessary to create usage caps to make it affordable for them to provide quality service to the majority of users. While there is some truth to this, it’s a double-edged sword.
While a small percentage of the population users more bandwidth than others, the underlying assumption made by carriers is that they only consume and not produce. While there may be some that ‘leech’, there are others that ‘seed’ new content, ideas, and information that benefits their specialized niche (and in turn everyone else).
Does this mean we should simply remove the consumers and leave the producers? No. Power consumers of the web also provide a benefit to the network. Without power users, networks would have no incentive to increase the capacity of their networks. Without a force to challenge the limits of what is currently available, nothing new will be produced. It’s simple economics. Without demand, there will be no supply.
There’s Money To Be Made Here
Here’s another way to look at it.
Let’s say Wal-Mart has 20 bags of chicken for sale. Most people buy 1 bag of chicken. However, there is one person who buys 10 bags of chicken.
Single handedly, he has cut the supply of chicken available in half. Wal-Mart could react to this a number of ways.
It could ration the amount of chicken someone can buy or it sell more chicken. By reducing it to this simplistic level, it’s not hard to see that an opportunity to profit exists here.
Without going too much into pricing strategies here, it is possible for them to survey power users to see what they would be willing to pay for increased consumption.
This would offset the cost to them for increasing capacity. In addition to this, they can implement better systems/technology to reduce universally unwanted bandwidth consumption.
I’m talking about junk mail.
Junk mail, also known as spam, accounts for 80-85% of all email in the world by some conservative estimates. That in itself is an incredible opportunity for Internet Service Providers to reduce unnecessary bandwidth consumption on their networks. It would save them a lot of money.
What The Future Holds
The estimated household is expected to use 200 Gigabytes per month by 2012. It’s pretty obvious the current 5 GB cap on most mobile broadband plans in the United States will be grossly insufficient.
A laughable joke a best.
Adopting a usage cap based broadband marketplace will only stifle creativity on the internet as users contemplate the cost of doing business.
While those with deep pockets will be able to afford it, in effect, it is against net neutrality (free of restrictions on content, sites, or platforms, on the kinds of equipment that may be attached, and on the modes of communication allowed, as well as one where communication is not unreasonably degraded by other communication streams).
As prices rise in such an environment, it is the very average user that companies now claim to ‘protect’ who will bear the brunt of the financial and opportunistic costs.
Long story short:
Companies need business models are good for them and their customers. Not just themselves.
We will now resume or regularly scheduled programming.
For more info on this, read "Is the 5 GB Cap Enough?