More expensive mobile apps are coming

One of the interesting things about legacy telephone contracts is that they were created before wireless carriers realized how valuable they were. But times change, and the carriers have been shifting their pricing plans to recognize that data access is far more valuable than minutes. The news that Verizon is moving to tiered data plans should not come as a shock to anyone. It was inevitable. And it is similarly inevitable that the other carriers will follow along. The current, unlimited, model is unsustainable.

But what will that mean to the market?

One effect is that middle-income parents will begin to think twice before buying a smartphone for their adolescent children. Maybe those kids will relearn how to play outside.

For business users, it means that those tantalizing mobile apps will become far more expensive. It won't be incrementally more expensive. It will be a LOT more expensive.

Consider this ... An electrical contractor with 30 field technicians wants them all to have tablets in order to handle work tickets electronically. If we use Verizon's pricing model as an example, that strategy will mean a minimum of nearly $11K in additional operating expenses every year. For many such firms, that will change the payback of mobile technology to something that may no longer be acceptable.

This unilateral decision by Verizon will impact mobile software developers, the Droid and Apple stores, and every firm with a mobile workforce. The technology consultant had better understand this when recommending solutions for their clients.

AT&T boosts wireless speed

AT&T announced that they are rolling out faster network speeds across its network. The company uses a High-Speed Packet Access (HSPA) network to provide 3G services, and it currently tops out at 3.6 Mbps downlink speed. The second-largest U.S. carrier is in the process of using software upgrades to boost that to 7.2 Mbps download speed. While the theoretical limit for HSPA is over 14Mps, few analysts expect any of the big carriers to push it to that level. That's because Sprint and Verizon Wireless are already testing the next generation of wireless broadband -- 4G -- in several markets across the country.

Since this puts the No. 1 and No. 3 carriers at a measurable and easily understandable disadvantage, I would expect that Verizon and Sprint will follow suit over the next few months. This makes sense because, given the current economic climate, most consumers will be hard-pressed to buy new 4G devices that don't give them any benefit in most of the country. And the same will be true for businesses, as well.

This will give AT&T a short-term advantage over the competition that perfectly complements their current iPhone monopoly. But the advantage won't last long, and - ultimately - customers will get the benefit.

Credit where credit is due:
InformationWeek: AT&T Beefs up 3G Network
AT&T Inc.: T (NYSE)
Verizon Communications Inc.: VZ (NYSE)
Sprint Nextel Corporation: S (NYSE)

ITIF Report: Expand Broadband to the rural market

The Information Technology and Innovation Foundation - a non-partisan research and educational institute - has identified how they believe $7.2 billion in government subsidies should be allocated. The recently enacted "recovery bill" allots that amount "in support of broadband" initiatives, and ITIF has stated that those funds should be used to deploy moderate-speed broadband to locations in "unserved" areas in the US. Most of these unserved areas are in rural, sparsely populated parts of the country where it is currently cost-prohibitive to deliver high-speed internet access. For customers located there, the only option is dial-up.

In the same report, ITIF suggests that non-wire-based technologies will probably be the best way to deliver these services.

In particular, 4G wireless can be a good alternative to fixed wireline in rural areas where subscriber density is low and fixed outdoor antennas are used to maximize radio signals.

Companies, like Sprint for instance, that have already begun deploying this type of advanced wireless technology will be in a good position to take advantage of this legislative action. Of course, there's no guarantee that regulators will take the advice of ITIF in this regard. But the law has been passed, for better or for worse. And if the money is going to be spent, to me this seems like a fairly reasonable approach.

Read the ITIF Report: The Need for Speed: The Importance of Next-Generation Broadband Networks

4G - Speed to burn

I have had a unique opportunity to test Sprint's nascent 4G WiMax network. Thus far, the results are astounding. Several speed tests have clocked in at 8Mbs download and nearly 3Mbs upload. Coverage is very limited at present, as Sprint builds out the network, and there are - as one would expect - very few users using the current bandwidth. However, the potential can't be overstated and I would keep an eye out for its general release in your area.