Cellular providers suck. There are essentially only 4 major companies, all of which charge insanely inflated prices, force people into plans with minutes they'll never use, and destroy you on overage fees if you happen to choose the wrong one.
The one saving grace argument for them is that they need to generate all that revenue to raise capital to upgrade their networks to 4G.
You know what that reminds me of? Broadband service providers.
Let's see: there are essentially only 5 major companies (Time Warner, Comcast, Verizon, Cablevision, AT&T), they charge inflated prices which are constantly getting higher (especially if you're getting TV from them, sheesh), and are beginning to destroy people with caps and metered billing.
The one saving grace argument for them is that average data usage per person is going up (due to things like YouTube, watcing shows online, etc.), and that they need to generate large amounts of revenue to raise capital to upgrade their networks.
But wait, is that true?
ArsTechnica reviews such a claim and finds that it's just not true. Even in the wake of upgrading systems and adding customers, revenues are going up while costs are going down. And it's not just average cost per customer that's decreasing, it's total costs.
So, are the major ISPs charging high prices just to generate increased profits? Most likely. Are the data caps and metered billing neccessary for them to stay competitive and solvent? Probably not.
Are they one day going to be worse than cellular providers? Probably. Afterall, ISPs are essentially natural monopolies since the fixed costs of entering an area are so high. So the incentives to generate competition (which leads to better services and more affordable pricing for consumers) are much less.
I'm interested to see what happens with all of this in 10-15 years.
http://arstechnica.com/tech-policy/news/2009/05/isps-costs-revenues-dont-support-data-cap-argument.ars
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