I'm not trying to flame here at all, but I feel like a few of the respondents are practically shills for the wireless carriers! If someone says that don't need mobile data access, why would you presume to know better?! The carriers don't "need" to restrict consumer choice in this way to enable profitability. They CHOOSE to restrict choice because the anti-competitive environment allows them to do so, and given the choice they are happy to influence the market for a known benefit today, over an unproven benefit tomorrow!
The wireless carriers of America have consolidated for "efficiency" enough that they have been allowed to create an oligopoly.
a pseudo-monopoly made up of a small number of very large providers who control the supply of a market and typically either directly or tacitly agree not to compete on one or more market factors.
Areas in which wireless carriers have agreed not to compete:
-Prices of phones - > nearly all new phones are purchased without knowing the true sales price as it is obscured with unspecified contract subsidy.
-Off plan text messaging - $.20/msg! Obviously this rate cannot be justified based on actual costs and along with no ability to refuse incoming text messages, it is designed to bully customers into choosing txt message plans which allow many more messages than actually used on average. These plans also then encourage switching from relatively data intensive phone calls to relatively tiny text messaging, while keeping revenue the same!
-Everybody pays the subsidy rate! They bully customers into two-year contracts by making you pay elevated monthly fees which pay for the phone subsidy even if you bought the phone outright for cash! If I buy my own cable modem, Charter doesn't still get to charge me $4 a month for it, why should wireless carriers?!
-Two Year Contract for all! Off contract phones are sold at an abusively inflated "Cash Price", but a new account still requires a two-year contract AND the carrier still exclusively controls the ability to actually use YOUR $600-700 device with a carrier lock!
-Data Plan Required for all smartphones, regardless of cash or contract purchase!
Yes I realize that their are plenty of prepaid and other marginal options, but even those are primarily controlled by the same players, don't offer the latest and most sought after handsets and are specifically marketed to a separate subset of consumers. The main wireless consumer class requires their utilities to be ongoing monthly plan/rate based services, so these alternatives don't compete for the same customers.
U.S. carriers have at best accidentally or at worst secretly agreed not to meaningfully compete with each other on the hugely important aspects of wireless services listed above and customers are suffering.
In a properly competitive environment, providers would: Sell a phone for a fair and profitable retail price, plus charge a fair and profitable rate for basic monthly service which would allow data plans to be optionally added for a fair price.
Instead carriers attempt to compete on 3 mostly constructed criteria; Perceived network reliability/quality, perceived price/plan differences, handset availability.
Handset selection should be controlled completely by the end user, not the carrier! Other than professional travelers, the rest of us spend 99.9% of our time in one or maybe two regions and so all that really matters is the network quality of carriers in your region. Finally, just through implied market actions, the small number of carriers guarantee that price/plan differences will typically be in parity with only short-term differences possible.
To Fix It:
It was federal regulators who led us to the slaughter by allowing a never-ending stream of mergers in this industry. It should fall to them to save us by forcing all four wireless carriers to split into two logical business units; network infrastructure and service provider. AT&T's service provider unit would then lease network capacity from AT&T's infrastructure unit at a fair market price and 3rd-parties could lease at the same or a similar price.
This would not be heavy-handed government action, but instead end the anti-American barriers to competition that the wireless industry has been allowed to create. If they are running efficient and competitive businesses that serve the free market best, than they have nothing to worry about as they would continue to dominate.
But I'm guessing it would look a lot more like the last time that congress busted up excessive supplier control in telecommunications... In 1984, AT&T's residential long distance rate averaged $.33/minute, that year regulators forced AT&T to give the same local toll access to all potential competitors and forced those competitors to pay the same costs as AT&T for long distance services. Within 5 years, AT&T's average residential long distance rate dropped to $.18/minute which was in line with competitors.
During this time, access, call quality, usage, and industry revenue all increased dramatically(despite falling prices,) simply because breaking up the market-hindering forces released a wave of pent up demand. That's because big market players are too afraid of losing what they have to take innovative risks for big gains.
Breaking up the damaging control that suppliers have over the current wireless market is the best and fastest way to encourage the evolution of telecommunications. Just think of how many devices in our lives we might actually connect to wireless networks if the end of monopolies meant we could connect as many as we wanted for between $5-10 per device. My monthly wireless bill might go up 10-20%, but the perceived value I get from receiving data when, where, and on which device I want could easily double my perceived value.
This will eventually happen either way, but if we wait for the oligopolists to deliver this future, it will take 10-20 years instead of the 5 that it could take!
