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Mobile Providers Could Charge Per Service

David Gilbert


Mobile Providers Could Charge Per Service

Imagine a world where your mobile phone provider could track everything you were doing and depending on what data you access, would charge you correspondingly.

Science fiction? We’re afraid not. It appears as if two companies have been outlining to major players in the US mobile market exactly where they think the future lies. A leaked PowerPoint presentation, which was presented at a webinar jointly hosted by Allot Communications and Openet, shows that in the future mobile phone providers could track what data their customers are accessing and charge them differing amounts for each service.

Allot Communications and Openet count Vodafone, Verizon and AT&T among their customers. Not exactly small fish then. One of the slides (see above) from the presentation shows what a Vodafone customer could be charged in the future for accessing certain services. For example accessing Facebook would cost 2cents per MB while YouTube would cost 50cents a month. However Vodafone services would be free for the customer. This could allow Vodafone to undercut its competitors in areas such as music or movie streaming products.

In what is a nightmare scenario for advocates of net neutrality, this slide seems to give us a clear indication of how things could go in the near future and this quote from the webinar is enough to put the willies up anyone net neutrality advocate:

"{We use} a number of different methods to accurately identify the application -- methods like heuristic analysis, behavioral and historical analysis, deep packet inspection, and a number of other techniques. What's key is that we have the best application identification available on the market, which means that even applications that are encrypted or use other methods to evade detection will be correctly identified and classified... We essentially feed this real-time information about traffic and application usage into the policy and charging system. Each subscriber has a particular service plan that they sign up for, and they're as generic or as personalized as the operator wants."

In the States the Federal Commission for Communications (FCC) is due to rule on whether to apply fairness rules to some of the ISPs and it has been rumoured that they will exempt wireless internet providers which would open the door for these type of billing options. And we all know, if it works in the States, it won’t be long before we could be seeing something similar over here in the UK.

Source: Wired


December 20, 2010, 8:31 pm

"And we all know, if it works in the States, it won&#8217t be long before we could be seeing something similar over here in the UK."

Well.... Not really, think of how paying for texting works in the USA (i.e. where the sender and receiver both pay for a text), thats been happening for ages in the USA and there is no way it would ever make it here because the market is so different. Any attempt to introduce it would cause a huge backlash.

TBH I think the mobile phone market is a lot tougher over here than in the US, partly because the networks have reached market stauration now and a huge pricing war has been going on between the networks (to the benefit of the customer), but also becuase one or two networks (previously T-mobile but now seemlying 3 mobile) have shown a real understanding of their postion as "data pipes" for mobile users


December 20, 2010, 9:32 pm

I&#8217m not sure whether we should view this as a surprise. Although I&#8217m an advocate of the concept of net neutrality, proposals such as these simply demonstrate how the market is maturing through a differentiation of its services, consumer types and charging models.

Net neutrality was, at best, a naive ambition that could never find expression: in true markets, the concept of neutrality (both economic, and, as the Wikileaks issue has shown recently, ideological) holds little meaning. One will hope that there might still be ISPs who would be prepared to offer (and charge for) an unbridled service, at market rates of course.

The legal issue is more intriguing. I&#8217m no lawyer, so can only guess at the ramifications for data protection of the concept of &#8220deep packet inspection&#8221. Given the subtlety of this, perhaps it&#8217s time to call for a &#8220Meta-Data Protection Act&#8221, in addition to the plain old DPA...


December 20, 2010, 9:50 pm

So, back to the bad old days? This seems a lot like how things used to work around 2000-2003, with mobile data access rendered completely useless by the fact the only accessible/affordable stuff was the crap pushed by the networks (think Vodafone Live): needless to say, not many people bothered with it back then (i-mode in particular flopped spectacularly). Why can't the EU just make this kind of crap illegal?


December 20, 2010, 10:51 pm

"What's key is that we have the best application identification available on the market, which means that even applications that are encrypted or use other methods to evade detection will be correctly identified and classified"

'Best available' != unbeatable


December 20, 2010, 10:52 pm

I simply can't see this happening. It would require all the networks to do the same, so that no one had an advantage but all companies gained (isn't that called price fixing?) because if one company (I'm looking at you, three), didn't adhere to this then a LOT of people would move to them.

A Scotland

December 20, 2010, 11:00 pm

I think that legislation over here (data Protection, competition, human rights) would also make it more difficult to implement. Although admittedly the enforcers do seem to be very slow to respond to corporate abuses.


December 21, 2010, 12:00 am

This doesn't surprise me at all. In fact I made such a suggestion to a mobile operator recently and they liked the idea.

In some ways we are already restricted or charged more based on the type of data we use. Some data bundles do not include access to Skype or other such VOIP services and you have to pay extra for these. They can already identify certain types of traffic so it won't be long before we can make use of this.

Why not help low data users who only use e-mails and browse a few websites have a reduced cost for their smaller data bundle compared to those who need high speed or masses of data streaming YouTube videos and downloading large media files?

Hans Gruber

December 21, 2010, 7:18 am

Surely data is just *data* no matter what you do with it? If you consume a lot by watching YouTube all day long then why can't you just be capped or pay more proportionately depending on your price plan/per monthly data allowance?

What possible reason do Mobile telcos have to charge traffic to social networking sites like Facebook at a different (presumably higher) rate than other sites? Does it cost more to post there? And, will they share the (again presumably increased) revenue with Mr Zuckerburg and co?

The (democratically) free net as we see it looks set to unravel pretty fast. Ironic that it's typically the so called biggest champion of democracy and freedom, the US, that will gain most from such changes.

BTW, the graphic used appears to show the Euro sign and not dollar so maybe those are eurocents? This would mean perhaps they're planning on launching this crap somewhere closer to home for those in the EU?


December 21, 2010, 2:31 pm

@Orinj - Oh I agree, there should be data packages for low data users, but equally there should also be packages for high data users. Whats so funny is that the networks now seem to be always complaining about how people are using their data packages, but they brought the whole situation on themselves in the first place by offering "unlimited" packages, and seem surprised when people get annoyed when they start desperatly backpeddling like they are now!

The ideal system is one where there are options to have low data, tarriffs with middle amount of data and then unlimited (the literal meaning of unlimited as well), each priced accordingly and with clear warnings if you reach your limits (no stealth tax for using more than your limit) and NO DATA THROTTLING!


December 21, 2010, 2:48 pm

@Hans Gruber - Quite. We pay so much a month to have their dumb pipes transport so many megabytes. There is no technical justification for a per-service pricing structure, as evidenced by the fact the telcos can't even tell what service is in use without the 'deep packet inspection', etc. that are being hawked in this presentation. And I am hopeful that this would not be legal under European law.

But - at a slight tangent to the original proposal - it does raise the potential prospect of Skype, YouTube, etc. monetizing their services by entering into revenue-sharing agreements with the telcos and charging the service against your broadband bill.

Mike Brown

December 21, 2010, 2:51 pm

It is not just a question of Data Protection legislation, or even human rights.

Deep packet inspection is message content interception in terms of the Regulation of Investigatory Procedures Act (RIPA). Performing dep packet inspection with the intent of determining the nature of the message content is a criminal act if performed within the UK, or on behalf of a UK business or other entity, unless authorised by specific warrant, or with the explicit informed consent of both ends of the communications link.

There is a close parallel with the case of the PHORM trials here.

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