May 14, 2012

Careful: 4G Could Fuel Data Overages

4G cellular networks build-outs are snowballing. At last week's CTIA Wireless 2012 conference in New Orleans, for example, Federal Communications Commission (FCC) Chairman Julius Genachowski noted that the U.S. is leading the world in 4G deployments with "64% of the world's 4G LTE subscribers."

And the U.S. is expected to have coverage across most of the country by late 2013. Sounds great. But what will 4G do to your wireless monthly data expenses? Let's face it: the bigger the pipe, the more content users can consume. And the more they consume, the bigger the bill.

Some startling math: A March 2012 blog by online researcher GigaOM about 4G pricing for the iPad noted that at maximum 4G speeds that an iPad could handle (73Mbps), a 5GB data plan would be drained in around nine minutes. Unfortunately, the days of unlimited data plans are dwindling, with Sprint hanging on as the sole U.S. nationwide carrier still offering unlimited plans. So you could conclude, simplistically, that if iPad users are on a 5GB plan and want to use the mobile network for more than nine minutes, overages are in their future.

Employers can just turn on the 4G hose and let their workers drink their fill of mobile bandwidth. Or they can attempt to manage expenses by creating structured policies augmented by real-time usage-tracking tools.

Won't BYOD Ease Costs?

Thumbnail image for WirelessTN-May14-ART.jpgHold the phone, you might be thinking. With the popular bring-your-own-device (BYOD) model, won't most employers just pay a flat payroll stipend to employees, who will then pick up the rest of the cost?

Ojas Rege, vice president of strategy at mobile device management (MDM) company MobileIron, holds this view. He believes that because of BYOD, employers' cost focus has shifted to taming hefty international roaming costs.

"As more companies adopt BYOD, the enterprise interest in managing service costs drops dramatically," Rege asserts.  MobileIron's mobile expense management component tracks user location and, via policy, either sends alerts to users about their usage levels or limits access to contain costs when users cross borders.

International roaming is certainly a big culprit behind mobile bill shock. Still, whatever bandwidth gets consumed for business purposes - global or domestic - is likely to impact corporate coffers.

For example, that flat monthly stipend an enterprise allows for business usage of personal device might have to increase. Also, despite all the talk about BYOD, there are plenty of companies still running corporate-liable shops. And most that do allow BYOD still support a sub-population of corporate-liable users. So businesses might need to buy bigger data plans for individual corporate-liable users or more generous data pools for them to share.

Making a Plan

The first step toward containing costs, advises Daniel Rudich, a senior vice president at telecom expense management company Tangoe, is for those responsible for paying corporate cellular bills to strategically classify employees into user groups - perhaps users with similar usage behavior. Then, analyze each group's usage volume to date and from there, decide how (and how much) each group should be reimbursed.

"If you haven't been pooling, look at it," says Rudich. Pooling, long available for voice, has recently become available for data plans. The business buys an aggregate amount of minutes or gigabytes per month, and users draw from the pool as they use the network. When the pool is drained, overage charges kick in.

"Find out what the optimal pool [plan] is for each group," Rudich advises. "Keep monitoring the pools because usage changes; for example, people change job functions and the applications they use change."

Options Differ for Enterprises, SMBs

As has been traditionally the case, larger enterprises with volume-buying clout have more options from carriers than small and midsized businesses (SMB). SMB data pooling plans tend to be preset, similar to consumer plans and allow for less customization than those available to big enterprises. So SMBs might have to buy a bigger plan than necessary to avoid paying hefty per-minute or per-KB/MB/GB overage charges.

On the other hand, newer expense management cloud services are available for smaller businesses. For its part, Tangoe offers a real-time wireless expense management service that continually calculates where users are in relation to their plan and makes projections based on behavior. Users and administrators can find out, at any time, what percentage of each plan has been used, how many days are left in the billing cycle, and so forth. The expense management service is available for between $3 and $5 per month, Rudich says.

There are other companies that offer real-time wireless expense management, too. One is Lyrix, with its SaaS called Mobiso; another is eMOBUS, with its Enterprise Mobility Management platform.


1 Comment

The maximum speed question for 4G piqued my curiosity as to what kind of speeds I was really seeing with a 4G connection. So I did a little bench-marking. But this is not extensive or scientific.

I found the following by using "speedtest.net" (app and with a browser) with some 4G devices over Verizon. What I found was (very roughly):

  1. Android Tablet (aka my "tabloid") - about 10 Mbps download and 5 Mbps upload; essentially the same with the app and when measured in a browser.
  2. Smart phone - 6 Mbps download and less than 1 Mbps upload.
  3. Smart phone tethered to a PC - 8 to 10 Mbps download and 3 Mbps upload; essentially the same as on the tabloid.

A couple of observations and caveats:
- I attribute the slow speed on the phone by itself to being processor limited on the phone rather than a differential service. After all, it's the same phone!
- The download speed was faster and upload faster on the tabloid when connected via WiFi rather than 4G.

Looking forward to hearing what other folks are measuring.

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