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Expert Opinion: ‘Making Sense of Data Caps and Tiered Pricing in Broadband and Mobile Networks’

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By Nick Feamster, Associate Professor of Computer Science, Georgia Tech  (The original version of this article is posted in Dr. Feamster’s Blog ‘Connection Management’)

WASHINGTON, February 27th, 2013 — Last week, I had the pleasure of sitting on a panel of the Broadband Breakfast Club at Clyde’s of Gallery Place in downtown Washington, DC.  The Broadband Breakfast Club is an event series, hosting events once a month, focusing on policy issues related to broadband service in the United States. It is organized by BroadbandBreakfast.com, a broadband policy news and events organization based in Washington.

I was previously asked to sit on a panel on measuring broadband performance, due to our ongoing work on BISmark, but I was unable to make the date last fall, so I found myself on a panel on data caps in wired and wireless networks.

I participated on the panel with the following other panelists: Serena Viswanathan, Staff Attorney at the Federal Trade Commission; Patrick Lucey, Policy Program Associate at the New America Foundation; and Roger Entner, Founder of Recon Analytics.  A keynote speech with presentation was provided by Ruth Milkman, Chief of the Wireless Telecommunications Bureau at the FCC. The panel discussed a variety of topics surrounding data caps in broadband networks, but the high level question that the panel circled around was: Do data caps (and tiered pricing) yield positive outcomes for the consumer?

We had an interesting discussion.  Roger Entner espoused the opinion that data caps really only affect the worst offenders, and that applications on mobile devices now make it much easier for users to manage their data caps. Therefore, data caps shouldn’t be regarded as oppressive, but rather are simply a way for Internet service providers and mobile carriers to recoup costs for the most aggressive users.  Patrick Lucey, who recently posted on a study he co-authored for the New America Foundation on data caps, stated a counterpoint that echoed his recent article, suggesting that data caps were essentially a profit generator for ISPs, and consumers are effectively captured because they have no real choice for providers.

I spent some time explaining the tool that Marshini Chetty and my students have built on top of BISmark called uCap (longer paper here).  Briefly, uCap is a tool that allows home network users to determine the devices in their home that consume the most data.  It also allows users to see what domains they are visiting that consume the most bandwidth.  It does not, however, tell the user which applications or people are using the most bandwidth (more on that below).  Below is a screenshot of uCap that shows device usage over time. My students have also built a similar tool for mobile devices called MySpeedTest, which tells users which applications are consuming the most data on their phones.  A screenshot of the MySpeedTest panel that shows how different applications consume usage is shown below (Click to enlarge):

uCap Screenshot Showing Device Usage Over Time and MySpeedTest Showing Mobile Application Usage

I used these two example applications to argue that usage caps per se are not necessarily a bad thing if the user has ways to manage these usage caps.  In fact, we have repeatedly seen evidence that tiered pricing (or usage caps) can actually improve both ISP profit and make consumers better off, if the consumer understands how different applications consume their usage cap and has ways to manage the usage of those applications.  Indeed, our past research has shown how tiered pricing can improve market efficiency, because the price of connectivity more closely reflects the cost to the provider of carrying specific data.  Further, we’ve seen examples where consumers have actually been worse off when regulators have stepped in to prevent tiered pricing, such as the events in summer 2011 when KPN customers all experienced a price increase for connectivity because KPN was prevented from introducing two tiers of service.

The problem isn’t so much that tiered pricing is bad—it is that users don’t understand it, and they currently don’t have good tools to help them understand it.  In the panel, I informally polled the room—ostensibly filled with broadband experts—about whether they could tell me off the top of their heads how much data a 2-hour high-definition Netflix movie would consume against their usage cap.  Only two or three hands went up in a room of 50 people.

I also confessed that before installing uCap and watching my usage in conjunction with specific applications, I had no idea how much data different applications consumed, or whether I was a so-called “heavy user” (it turns out I am not).  My own experience—and Marshini Chetty’s ongoing work—has shown that people are really bad at estimating how much of their data cap applications consume.  One interesting observation in Marshini’s work is that people conflate the time that they spend on a site with the amount of data it must consume  (“I spend most of my time on Facebook, therefore, it must consume most of my data cap”).

If we are going to move towards pervasive data caps or tiered pricing models, then users need better tools to understand how applications consume data caps and to manage how different applications consume those caps.  I see two possibilities for better applications going forward:

Better visibility.  We need applications like uCap and MySpeedTest to help users understand how different applications consume their data cap.  Helping users get a better handle on how different applications consume data is the first step towards making tiered pricing something that users can cope with.  In addition to the applications that show usage directly, we might also consider other forms of visibility, such as information that helps users estimate a total cost of ownership for running a mobile application (e.g., the free application might actually cost the user more in the long run, if downloading the advertisements to support the free application eats into the user’s data cap).  We also need better ways of fingerprinting devices; applications like uCap still force users to identify devices (note the obscure MAC addresses in the dashboard above for devices on my network that I didn’t bother to manually identify).  Solving these problems requires both deep domain knowledge about networking and intuition and expertise in human factors and interface design.

Better control.  This area deserves much more attention.  uCap offers some nice first steps towards giving users control because it helps users control how much data a particular device can send.  But, shouldn’t we be solving this problem in other ways, as well?  For example, we might imagine exposing an SDK to application developers that helps them write applications that are more cognizant of data constraints—for example, by deferring updates when a user is near his or her cap, or deferring downloads until “off peak” times or when a user is on a WiFi network.  There are interesting potential developments in both applications and operating systems that could make tiered pricing and demand-side management more palatable, much like appliances in our homes are now being engineered to adapt to variable electricity pricing.

Finally, Patrick made a point that even if users could understand and control usage caps, they often don’t have any reasonable alternatives if they decide they don’t like their current ISP’s policies.  So, while some of the technological developments we discussed may make a user’s life easier, these improvements are, in some sense, a red herring if a user cannot have some amount of choice over their Internet service provider.  This issue of consumer choice (or lack thereof) does appear to be the elephant in the room for many of the policy discussions surrounding data caps, tiered pricing, and network neutrality.  Yet, until the issues of choice are solved, improving both visibility and control in the technologies that we develop can allow both users and ISPs to be better off in a realm where tiered pricing and data caps exist—a realm which, I would argue, is not only inevitable but also potentially beneficial for both ISPs and consumers.

Sylvia manages the Broadband Breakfast Club, on-the-record monthly discussion groups that meet on the THIRD Tuesday of each month. She has had a long career in non-profit development and administration, and has raised funds for technology and science education, and managed a project on health information exchange adopted by the State of New York. She understands community education and infrastructure needs for effective broadband access.

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Broadband Breakfast on November 30, 2022 – The 12 Days of Broadband

Introducing the Broadband Breakfast Club during the 12 days of broadband.

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Our Broadband Breakfast Live Online events take place on Wednesday at 12 Noon ET. Watch the event on Broadband Breakfast, or REGISTER HERE to join the conversation.

Wednesday, November 30, 2022, 12 Noon ET – Introducing the Broadband Breakfast Club During the 12 Days of Broadband

In this session of the Broadband Breakfast Live Online on Zoom, Editor and Publisher Drew Clark will introduce the Broadband Breakfast Club. He will recap the Digital Infrastructure Investment–Washington conference, and highlight the videos from the event, which are now available to Broadband Breakfast Club members. (Conference attendees and registrants for our recent Broadband Mapping Masterclass will receive two months’ complimentary access to the Broadband Breakfast Club.) Clark will outline the benefits for Broadband Breakfast Club members, including:

  • Exclusive Access to our Signature Course on Digital Infrastructure
  • 2 Hours of Monthly Group Coaching on issues of Digital Infrastructure
  • Exclusive Monthly Report on the latest developments impacting Digital Infrastructure - The report for December 2022 report will feature the "Top 12 Stories in Broadband from 2022"
  • Exclusive Access to Video Content from Digital Infrastructure Investment and subsequent events

All of these benefits are available for $99/month. However, during our 12 Days of Broadband Sale, from Thursday, December 1- Friday, December 16, you can purchase monthly membership for $60/month. If you register now, for this one-time price, you'll lock in your discount for as long as you remain a Broadband Breakfast Club member!

To become a member of the Broadband Breakfast Club, register here or reach out to membership@breakfast.media.

Panelists:

  • Drew Clark (presenter), Editor and Publisher, Broadband Breakfast

Drew Clark is CEO of Breakfast Media LLC, the Editor and Publisher of BroadbandBreakfast.com and a nationally-respected telecommunications attorney. Under the American Recovery and Reinvestment Act of 2009, he served as head of the State Broadband Initiative in Illinois. Now, in light of the 2021 Infrastructure Investment and Jobs Act, attorney Clark helps fiber-based and wireless clients secure funding, identify markets, broker infrastructure and operate in the public right of way.

Access Premium content for Broadband Breakfast Club members. Login to your account below. Or visit Broadband Breakfast Club to signup.

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Broadband Breakfast on December 28, 2022 – New Year Recap: Biggest Stories in Broadband

Join the Broadband Breakfast team and our guests to discuss the biggest stories in broadband in 2022.

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Our Broadband Breakfast Live Online events take place on Wednesday at 12 Noon ET. Watch the event on Broadband Breakfast, or REGISTER HERE to join the conversation.

Wednesday, December 28, 2022, 12 Noon ET – New Year Recap: Biggest Stories in Broadband

Join the Broadband Breakfast team and our guests to discuss the biggest stories in broadband in 2022. Plus, we’ll make predictions for what to expect in 2023. We’ll discuss:

  • The first year of implementing the Infrastructure Investment and Jobs Act.
  • How broadband and the hybrid workforce are adapting to the post-pandemic reality.
  • The role of the national broadband map and challenges to it.
  • Key moments in the ongoing fight about online content moderation.
  • The future of broadband infrastructure development in the face of a number of workforce and supply chain challenges.
  • And more!

Make sure to tune in for this special year-in-review Live Online.

Panelists:

  • Panelists have been invited
  • Drew Clark (moderator), Editor and Publisher, Broadband Breakfast

WATCH HERE, or on YouTubeTwitter and Facebook.

As with all Broadband Breakfast Live Online events, the FREE webcasts will take place at 12 Noon ET on Wednesday.

SUBSCRIBE to the Broadband Breakfast YouTube channel. That way, you will be notified when events go live. Watch on YouTubeTwitter and Facebook

See a complete list of upcoming and past Broadband Breakfast Live Online events.

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Broadband Breakfast on December 21, 2022, – Robotics, Telehealth and Future Health

Smart technologies hold incredible promise for the future of healthcare. How can we lay the groundwork now?

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Our Broadband Breakfast Live Online events take place on Wednesday at 12 Noon ET. Watch the event on Broadband Breakfast, or REGISTER HERE to join the conversation.

Wednesday, December 21, 2022, 12 Noon ET – Robotics, Telehealth and Future Health

Smart technologies hold incredible promise for the future of healthcare, particularly for those living in remote rural areas or who are unable to afford traditional care. Broadband has to be up for the challenges. Telehealth developments have already revolutionized the industry, optimizing patient outcomes through remote monitoring and wearable smart devices. Further developments may bridge the gap of the workforce shortage. How can we lay the groundwork now for broadband expanding data traffic? Join us for a special Live Online event featuring a panel of experts — and a telehealth robot.

Panelists:

  • Arshia Khan, Professor & Director of Graduate Studies, University of Minnesota Duluth
  • Craig Settles, Broadband and Telehealth Expert
  • Other panelists have been invited
  • Drew Clark (moderator), Editor and Publisher, Broadband Breakfast

Dr. Arshia Khan holds a bachelor of engineering in computer-engineering, an M.S. in computer science and a Ph.D in information technology. Her research efforts are directed at growing the emerging new field of biomedical and health informatics, specifically in the areas of neuroscience and therapeutic robotic assistive technology in combination with sensors and IoT (Internet of Things). This research, which combines her computer science and engineering skills with medicine, offers promising solutions to chronic neurodegenerative problems such as dementia and elderly care. Her research requires strong and varied interdisciplinary collaborations with experts in fields of cardiothoracic surgery, neuropsychology, psychology, physical therapy, dietetics, nursing and occupational therapy.

Saved from a stroke by telehealth, Craig Settles pays it forward by uniting community broadband teams and healthcare stakeholders through telehealth projects that transform healthcare delivery. He conducts needs analyses with community stakeholders who want broadband networks to improve economic development, healthcare, education and local government.

Drew Clark (moderator) is CEO of Breakfast Media LLC, the Editor and Publisher of BroadbandBreakfast.com and a nationally-respected telecommunications attorney. Under the American Recovery and Reinvestment Act of 2009, he served as head of the State Broadband Initiative in Illinois. Now, in light of the 2021 Infrastructure Investment and Jobs Act, attorney Clark helps fiber-based and wireless clients secure funding, identify markets, broker infrastructure and operate in the public right of way.

 

WATCH HERE, or on YouTubeTwitter and Facebook.

As with all Broadband Breakfast Live Online events, the FREE webcasts will take place at 12 Noon ET on Wednesday.

SUBSCRIBE to the Broadband Breakfast YouTube channel. That way, you will be notified when events go live. Watch on YouTubeTwitter and Facebook

See a complete list of upcoming and past Broadband Breakfast Live Online events.

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