LTE may change the charging model of the telecommunications industry
The next generation of mobile communication technology not only changes how fast you can download your favorite LadyGaga music videos, it also affects your wallet.
The latest technical vocabulary is called LTE. This is a quasi 4G wireless communication standard, which is supported by many major telecommunications companies in the world. This standard will become more and more popular in the following year. The overwhelming publicity about LTE has created high expectations for higher wireless download speeds. Verizon Wireless has begun to guarantee the potential benefits of LTE.
But skeptics say that the speed of this network will increase as the number of users becomes larger. They also remind people not to believe too much in their early promises about speed. More importantly, in the process of upgrading from the current 3G to 4G, operators may be able to implement an idea they already had: adopt a tiered pricing model and charge more fees to users with large amounts of data.
Rory Altman, a partner at consulting firm Altman Vilandrie & Co., said that upgrading to 4G gave them an excuse to implement this pricing model.
With the exponential growth of mobile Internet traffic, there are more and more cases where certain users use a large number and drag down the entire network. AT & T said that 3% of its users occupy 40% of the traffic, and these users are most likely equipped with Apple ’s iPhones. AT & T CEO Randall Stephenson said that he expects the wireless Internet industry to eventually implement a differentiated pricing model, but when asked whether 4G will become a catalyst, he has left and right.
He said he did not know what the precipitating factors were. This view is also one of the very few consensuses between Verizon Wireless and its competitors. Verizon Wireless is a joint venture between Verizon and Vodafone Group. Last week the company's chief technology officer Anthony Melone said that pricing plans that do not limit traffic are "an important issue that must be changed."
Many people expect a hierarchical pricing model, according to which consumers pay according to the monthly traffic. This is similar to the 5 Gigabit monthly bandwidth limit set by telecommunications companies for wireless data cards for notebook computer users. Five gigabytes is equivalent to downloading 14 episodes of half an hour of television programming.
One possible complicating factor is that users do not know how much traffic they use. Mobile phones generally do not display current data usage, and users are not used to tracking how many emails they send, or how often they use the phone to surf the Internet and watch videos.
Why should consumers pay more? Under the guidance of 4G advertising, many people may be willing to pay this premium, because they understand that the change in fees represents an improvement in services.
William Davidson, Qualcomm ’s head of global marketing, said that in his view, LTE is more about how to preserve the end user ’s current experience. He believes that there will not be many people enjoying high network speeds.
LTE proponents claim that this technology can reach more people faster at a lower cost. At the beginning, a small number of users using LTE will enjoy ultra-high network speeds. But like 3G technology, as more people use LTE services, the high-speed benefits of this network will become stagnant.
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