Don't Throttle Me: Other Ways To Manage Wireless Traffic
Guest post on Forbes by Skyfire CEO, Jeffrey Glueck
Over the last month much has been said about AT&T’s decision to throttle those customers on unlimited data plans who use over 1.5 gigabytes in a month. As many have pointed out, carriers are confronting real capacity issues as data growth explodes, but blanket throttling is a crude and unfriendly hammer.
Choking users’ download speeds to a trickle, around the clock, for two weeks or more a month, regardless of whether the local network is congested at that moment, is an example of a “solution” developed with rudimentary network management tools and gives the appearance of not having customer experience in mind. In essence, this kind of policy punishes users merely using a service they pay for. A small claims court recently found for an aggrieved user, and agreed the carrier broke its promise of “unlimited data” by choking bandwidth for weeks at a time. More suits are coming.
As big brands should know, heavy users are typically the biggest advocates or worst critics. The voices of the throttled have been loud thus far. And with some reason: carriers advertise that users on smartphones can enjoy video on their devices. But a user who streams just two hours of HD video on their phone could easily be throttled for having eaten up their 1.5 gigabyte allowance. The irony is that carriers can solve the network crunch problem in a more constructive way.
A myriad of options put user experience at the forefront, while achieving the same cost savings: video and image data optimization, WiFi offload, femtocells, 4G build-out and others. I sympathize with the network planners at wireless operators. For example, AT&T says its data traffic grew 5,000% after the launch of the iPhone, which overloaded its network in many large cities. Globally, according to a recent Cisco report, mobile data traffic will grow 18,000% from 2011 to 2016, as smartphones and tablets proliferate. Video sits at the heart of the problem, and is already eating half the bandwidth. Cisco projects video will account for 71% of mobile bandwidth by 2016. This massive increase, what I call Mobile Warming, will flood cell towers, stall video, slow downloads and drop connections.
The problem is only getting worse: Better screens and faster connections allow users to access high quality content, while device makers and publishers keep adding more HD capabilities and content. Meanwhile, users have no way to self-police the size of videos in advance. A one-minute video might burn two megabytes, or 20. With 30 percent of users already averaging one gigabyte of data use per month, the handful of ‘heavy’ users targeted will soon include a large number of mainstream users.
In most digital businesses, brands value their most devoted and frequent users. Can you imagine Facebook informing users they are clicking the ‘Like’ button too often and will be capped? Or Twitter telling their fans to tweet less often? Of course not. Super-users are their biggest advocates. To be fair, AT&T is in a different boat: it spends $20 billion a year on capital expenditures and faces even higher costs as demand continues to grow exponentially relative to subscription revenues. But the larger idea is the same: it’s wise to find a way to make your heaviest users happy that doesn’t break the bank at the same time. There are better ways to lighten the bandwidth crunch, keep video streaming smoothly, and enable consumers to connect at peak hours.
Throttling a customer 24×7 might free up bandwidth for other users, but only by rendering a heavy user’s phone unworkable. Consider an alternative, where heavy users can watch videos while the effective capacity of the tower is instantly expanded based on demand loads.
Cell towers, spectrum and backhaul pipes are a finite resource. If a few users trying to stream videos to 4-inch screens are ruining connectivity for dozens of other current users on the tower, a dynamic “fair use” division of the spectrum does make sense. However, solutions exist today that can let those users enjoy rich media, without ruining it for everyone else, nor bankrupting the carrier. By leveraging solutions like surgical optimization, WiFi offload, femtocells and other technologies, carriers can shape traffic on their networks on-the-fly and save a large percentage of bandwidth without punishing the user.
If you attend mobile industry events as I do, you will hear wireless carriers frequently bemoan that “over the top” services like Google, Facebook, Netflix, Amazon and Apple are making large profits riding atop the networks that carriers pay huge sums to build. And that’s true. But sometimes the carriers forget that they too are well paid for this data – by their subscribers. Carriers will earn $80 billion in data-related revenue in the U.S. in 2012, and data customers typically pay $600-$1000 a year. Contrast that with players like Google or Facebook, whose websites typically earn less than $25 a year per user in advertising and search revenue. Moreover, one could argue that over the top services are building the killer apps that allow carriers to sell more smart phones and data plans. Operators do have important paying customers to care for, and retaining those customers makes for good business. It’s time to find a smarter way.
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