Netflix has changed its rate plans, and Sprint is hinting at testing bandwidth-capping through its Virgin Mobile brand. While these moves may not seem that severe, one has to ask, what is the world coming to? What is behind these decisions? Poorly structured pricing plans? Maybe. More likely is that a product was pushed out through a supporting network that just couldn’t handle it. Big corporations push products to market to make money––this is capitalist America, after all––and this has given rise to some amazing products throughout the history of our economy. If the supporting system isn’t powerful enough, however, the well-laid product plans can fail miserably right out of the gate––or later, as the profit model supporting that product gets more complicated.
On July 12, Netflix announced price and plan changes via a blog post, and the Internet blew up in response. Netflix has always had great customer loyalty and has listened to customers in the past, but a 60% price hike is hard to stomach. As mentioned in a CNET post, Hollywood is beginning to wake up and smell the cash as it learns how to price streaming correctly, but we end users just see fewer big titles available for streaming and a higher price to pay. Netflix abandoned its loyal customers with this change and, more important, shows signs of following a trend online where companies offer an innovative product, wait for it to go mainstream, and then bamboozle their customers once all parties involved realize how much they can make from the product. To complicate that even further, Netflix––like many other data-intensive online services––has felt the pain of network limitations in the US. Slow adoption of broadband and pathetic high-speed mobile connections make its product sluggish for the end user when, in reality, the pipes that carry the data are the issue.
Which brings the conversation to throttling and the newest entrant in the “let’s throttle your data” game show: Sprint via Virgin Wireless and its testing of data-speed throttling. Sprint joins the ranks of AT&T and Verizon in that once a threshold of data usage is breached, the clammy hand of data death clamps down on your download speed. Sprint claims that only three percent of its users are affected, but as more and more cloud services are offered, that number will increase. Data-throttling begs the question, “Why throttle anyway?” The easy answer is the almighty dollar, but the real answer lies in poor network development. The pipes just can’t handle the current load, which leads to network performance issues, which ultimately affects every service or application that requires a connection to the net.
As more and more cloud services are offered, the data caps will just become a bigger issue. The amateur smartphone owner who surfs the net and does basic emailing and social media posting may never really have an issue with data caps, but once these users start streaming video, music, and files through cloud services, they are in for a rude awakening. Mobile customers need better options, and so far, the market has only narrowed the offerings on the floor and raised the price for each.
Author: John Carew