“Unlimited” Wireless Data is Back — For Good?

After a half-decade hiatus, unlimited data plans are back on our nation’s four largest cellular carriers – AT&T, Verizon, Sprint, and T-Mobile.

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Did you notice? If you’re anything like my roommate, you might not have noticed the sneaky games these carriers have been playing over the years. “These phone companies capitalize on people’s inability and unwillingness to understand how they work,” said my technically inept roommate as I told him about this topic at the time of writing. As much as I joke about him being technically inept, he likely shares the same sentiment that millions of Americans do when jumping through the never-ending hoops that is Phone Carriers 101.

Back in 2007, AT&T — who had an exclusive deal with Apple at the time — announced unlimited data plans to support the release of the brand new iPhone. At “just $59.99 per month,” subscribers enjoyed “unlimited data, Visual Voicemail, 200 SMS text messages, roll-over minutes and unlimited mobile-to-mobile calling.” Those were the days, right?

Wireless technology in the 2000s was just as simple as the pricing scheme of our cell phone plans, relatively speaking. Flip phones were in, 160-character texts were the norm, and you called the illusive number to listen to your voicemails without thinking twice. Wireless data was a new phenomenon, and the release of the iPhone was arguably the first widespread application of wireless internet access, barring pay-by-the-kilobyte web browsing that your parents screamed at you for when they got the bill at the end of the month.

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And thus, as technology evolved, so did the iPhone — iPhone 3G boasted next-generation internet speeds as well as the introduction of the App Store. Data usage increased exponentially as Apple enjoyed widespread adoption of its second-gen smartphone. MMS — yes, the ability to send pictures through text — joined the Messages app with iPhone 3.0 software update two and a half years later.

Fast forward to the introduction of next-gen phones, LTE, and the brand-new iPad, and you’ve got a potent combination for data-hungry users. You could now binge-watch Netflix from virtually anywhere. It got so insane that people cancelled their home internet service to use the personal hotspot feature on their phone to power their life.

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Sounds like a win-win, right? Well, not so much. There were two major problems with how the carriers proposed this business model and how customers responded to it. First off, 4G was a new technology, and the bandwidth built out by the carriers wasn’t capable of handling the high-intensity web traffic sought by users, such as HD Netflix streaming. Second, and not to much surprise, customers took advantage of their newfound “unlimited” data.

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As the adage goes, all good things must come to an end. When carriers started to notice this massive upscale of mobile data use — as large as a 26-fold increase — they initially responded with imposing limitations, such as data caps and throttling. Soon after, they phased out unlimited plans altogether. Unlimited data’s grave was dug with the rise of “tiered” data and shiny new “family” plans that promoted the sharing of data across devices.

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For years, carriers led us customers to believe that tiered and shared data plans were the wave of the future. Even T-Mobile touted tiered data plans for a period of time. With each new rollout of a data plan came more strings attached and greater customer confusion. Rollover data, overage limits, switching data plans at a fee, and confusing plan terms benefited only the carriers. The days of unlimited data plans returning were looking grim. The light at the end of the tunnel? Faster data speeds, more reliable coverage, and — for light data users — pretty substantial savings.

But what we didn’t see behind the scenes is that although unlimited data plans were curtailed to relieve network congestion and improve overall performance (or so they say), the four major carriers were investing billions to beef up their network’s strength. Once they accomplished this feat, they became hungry for customers. T-Mobile launched its “uncarrier” campaign to woo customers from AT&T and Verizon; Sprint touted its “1% reliability” ad spots to lure customers from Verizon; AT&T merged with DirecTV to bundle home entertainment with wireless plans; and, last but not least, Verizon unveiled its “unlimited” plan early this year, as if déjà vu is a hoax.

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At the time of writing this, “unlimited” is back – but with many of the nooks and crannies of their late-2000s predecessor. Depending on your carrier and your plan, you’ll likely experience a rollercoaster of carrier emotions. If you’re on T-Mobile, you might enjoy Netflix included – but have HD video quality suppressed across the board. AT&T offers free HBO for new subscribers, but can slow you down after eating up data too quickly. On Verizon? Your data isn’t capped after a set amount, but it could be slowed down at any moment if a lot of people around you are using their data too. And Sprint’s too-good-to-be-true free unlimited data does give you (mostly) free reign, but it expires after a year of service.

So, what to do? For now, let’s be thankful (🙏🙌) that unlimited data is back, even if you don’t have an unlimited plan. This is great for competition, and gets the carriers out of their former monopolistic mindset and gives power back to the consumers. If history has taught us anything, Unlimited 2.0 could be short-lived. As with most companies, the major carriers are following the capitalistic rules of digital business that are ever-changing with the rise of new technologies. The old way of doing business is no match to our evolving society, and it’s evident that even the historically most rigid industries are becoming more agile.

 

Further reading: I embedded dozens of links to articles throughout this post to encourage further reading. If you’re looking for more, this article suggests yet another end to the second wave of “unlimited” data: https://www.wired.com/2017/02/unlimited-data-party-will-last-big-four-become-big-three/

9 comments

  1. ojeagle121 · ·

    Interesting. I’ve heard a lot recently about carriers partnering, or acquiring like ATT and DirecTV, with different media outlets to provide unlimited streaming for that platform. I guess this blends in with some upcoming Net Neutrality rules. It really is a ‘veiled’ unlimited data plan. And you’re right, capitalistic interests will prevent it from being truly unlimited.

  2. Yvette Zhou · ·

    Very interesting topic! I always want to change my plan to unlimited. But after seeing your post, I might wait for a while to see what will happen Lol. I guess these 4 carriers have worked on their business models since they firstly had partnerships with smart phone manufacturers so that they probably have many deep thoughts of how to deliver better service and generate more profits. Unlimited plan did bring us negative effects and we don’t know how it will go later. Nonetheless, it seems to be a trend that all the plans will be with unlimited data in the future just like the home internet service evolution. The root cause I think is that people don’t understand how much data have been or going to be used. The only thing we know is “we almost use 4GB every month”, but do we know how much exaclty we use for watching a show on Netflix? No one can count that like a machine does. Therefore, data usage can be controlled but not in a precise way. Unlimited data solves the problem and exactly meets the customers’ need about “don’t want to estimate data usage”, which will make the plan popular. So I guess 4 carriers will continue working on how to improve the data traffic in order to ensure the quality of unlimited data plan and may gobble home internet service business finally.

  3. I’m interested to see how this kind of thing develops – I did switch back to an unlimited data plan, but I’m also paying for internet service in my apartment. You raise a good point that it could be argued to be unnecessary to be doing both, especially as millennials shift toward ‘cutting the cord.’

    1. I do agree with cutting the cord, but I do not believe that a cel phone wireless internet will be able to support what we, millennials care about when using our phone. Streaming, Binge watch Netflix as the blog mentions, Live Sports, Videos, etc. I think it is not coming soon. We need to at least wait for 5G or other forms of speeds to be able to use our cell phone as basic internet service at home.

  4. clairemmarvin · ·

    I hadn’t given much thought to the evolution of data plans but after reading this, I can recall to memory the “unlimited” campaigns of at least three of the major networks off of the top of my head. It is so true though about the complexity of phone contracts, I honestly could not tell you how much data I have used this month or how much I should be using to stay within my plan! Literally 5 minutes ago I was talking to my Dad on the phone but the reception in my dorm is so bad I was forced to enable wifi calling. I have no idea how that will affect my data plan or if it will charge me more and I guess I won’t find out until I get this month’s bill. I am optimistic that unlimited data plans will continue to be provided, however. With every new phone or software upgrade, our need for data only will increase exponentially and since people are now accustomed to unlimited data models I would be surprised if they would accept anything less in the future.

  5. It will be more interesting to know what will happen with the T-mobile and Sprint merger. Yesterday news was that both parties are starting their due diligence and it’s going to happen soon. Also, interesting how Sprint tanked 8% on the news. Is this good, bad or worse for Sprint? Or T-Mobile?
    In another note, unlimited data, in my experience and back to Mexico, we never had and probably never will. There are only two main companies of telecom, one being Carlos Slim’s Telmex and the other Iusacell (which AT&T bought). Both “rob” from consumers, they sell “minutes” or “100 pesos” worth 5-8 minutes of talking and 15-20 SMS (yes they still charge them)
    So in my experience, the data plans here in the US are way better, but also more expensive. It will be interesting to see how they transform their networks with 5G and how costs are going to probably increase for us consumers after the merger.

  6. The unlimited data plans are coming back at just the right time. we just got my Middle School daughter her first phone, and there was no way I was going to give a middle-schooler a phone without unlimited data. In fact, I was just about to switch when ATT re-introduced the plan.

  7. Hilary_Gould · ·

    I know my mom’s least favorite place in the world is the AT&T store. She always feels like they’re selling her something or tricking her into a plan she doesn’t actually want. Unfortunately, for the time being my mom is in charge of my family’s cell plan even though she is the least tech-y person. This means that the three kids end up fighting over data while my mom somehow gave herself more… The complexities of these plans is crazy and they all have tons of hidden fees and clauses. I’m curious to see how long these “unlimited” plans last and how people react to the fine print!

    1. mgiovanniello · ·

      When my family had AT&T, my mom (through a business account) resented trips to the store as well. For us, it got so bad that some would take other people’s upgrades so they could get the latest and greatest phone, only to screw over the person deserving of that upgrade. This caused chaos and mixed up each person’s data plans and phone numbers. Not to mention the upsells and shuffling around of phone plans at each store visit. All part of the experience!

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