The very hungry smartphone data user
Smartphone data usage has skyrocketed over the past six months, even with the onset of usage caps--and consumption may not reach its peak until sometime next year.
Smartphone subscribers are hungry for data, and their appetites are growing, according to a study.
Validas, a company that analyzes cell phone bills for consumers, looked at data over the past year, from July to June, and saw a dramatic increase in mobile data usage for smartphone subscribers at every major carrier except T-Mobile USA.
Verizon Wireless smartphone users led the pack in terms of the biggest percent increase in data consumption, gobbling 150 percent more data on average in the first half of 2011 compared with the preceding six months. On average Verizon customers consumed about 206.6MB of data in the second half of 2010. This usage shot up to 512.4MB in the first half of 2011.
Sprint smartphone customers led in terms of the amount of data used, increasing data consumption by about 381MB more data per month. AT&T smartphone subscribers consumed 116 percent more data in the first half of 2011, also a significant rise.
Meanwhile, average data usage for T-Mobile smartphone customers didn't change much between the second half of 2010 and the first half of 2011.
So what does this mean? Dylan Breslin-Barnhart at Validas believes that for the top three major wireless carriers data consumption has not yet hit its peak, and he expects to see even greater usage throughout the rest of 2011 and into 2012.
"While T-Mobile Smartphone users' data plateauing suggests that there are ceilings in data consumption, the massive data usage increase for AT&T and Verizon Wireless Smartphone users suggest that they haven't come close to hitting one yet," he wrote in a blog post about the findings.
Sprint's unlimited data plan, coupled with the company's fast 4G network, has likely.
Meanwhile, Verizon Wireless and AT&T are likely seeing big jumps in data usage due to Apple's iPhone. Verizon first. And AT&T has sold .
The shift toward data caps
This rapid growth in data usage comes as more wireless operators move away from all-you-can-eat data plans to service offerings that are capped at certain limits. AT&T was the first major wireless carrier in the U.S. to introduce data caps on its smartphone customers. It now requires new subscribers to sign up for either a $15 plan for 200MB per month or a $25 plan for 2GB. When AT&T launched its new pricing plans in June 2010, the company said that 98 percent of its subscribers used less than 2GB per month of data. This still may true, but as growth continues a smaller percentage of customers are likely to find the 200MB tier of service worthwhile.
Verizon Wireless. It's lowest tier of service across its entire customer base is $30 for 2GB of data. It's most expensive plan is $80 for 10GB of data per month.
But Verizon is also looking at ways to accommodate low-data consumption users. Earlier this week, it confirmed that it will test a new service plan that will cost $20 for 300MB of data per month. The plan is available to new and existing Verizon Wireless customer now through September 30 in Washington D.C., Virginia, Baltimore, and parts of North Carolina.
Customers who exceed the 300MB data cap will automatically be charged $20 for another 300MB. The plan is designed to give people thinking about moving to a smartphone but scared off by the cost of the data plan an alternative, the company said in a statement.
A swing and a miss?
Some companies that distribute rich media to mobile devices worry that the data caps will scare customers away from using their services because they're afraid of using too much data.
"It just doesn't make sense to me," said Bob Bowman, CEO of MLB Advanced Media, the Web property of Major League Baseball. "They're trying to get their best customers to never use data."
Bowman said that the MLB service, which allows subscribers to stream video of live baseball games, probably isn't eating up much of a consumer's monthly data allotment, because most people don't watch an entire game on their mobile phones, but may instead watch snippets of the game while they are out and about. But he said the fact that it's video and the fact that the data service is capped, may spook some viewers and cause them to watch less.
"I just can't see how this would be good for anyone in the business distributing rich media," he said.
That said, it appears that AT&T customers are actually doing just the opposite of what Bowman fears. On average, according to the Validas data, AT&T subscribers saw a more than 100 percent increase in data usage from the last half of 2010, when the data caps were introduced, to the first half of 2011, when the company sold record numbers of iPhones. This suggests that the usage caps may not be having an effect at all on the growth of data consumption.
It is still early days in terms of the carrier data caps. So it will be interesting to see how customers' behavior changes over time, especially as wireless operators get more restrictive with their data usage plans. Earlier this summer, AT&Tfor subscribers that were grandfathered into its previously offered unlimited data plans, attempting to restrict them to the 2GB data cap without charging an overage fee.
T-Mobile has also recently announced that it willon its lowest tier of data service. And there is speculation that Sprint Nextel may be forced to for a tiered offering.