How much does it really cost to provide cellular data access? And in providing it as a service in other countries, how much does it take for your home provider to keep you connected?
It’s a closely guarded industrial secret. How much can providers charge?
As much as they can.
My provider (Verizon) provides one fee structure for data roaming – you get 100Mb of data for $25. I used mine recently for a 2 week trip to New Zealand (as well as now for an extended stay in Canada), and with all kinds of notifications that a smart phone is pinging for, that silent kaching is going all the time. I hit 5MB in my first day with barely using it. I racked up $75 in New Zealand, and am about $50/month extra now in Canada.
I change my habits; I am always seeking open wifi. I turn off automatic mail fetching. I tried for a while in New Zealand putting it in airplane mode while out and about.
I expect it must cost something to use data from another provider. How much? No one knows.
@VZWSupport Thanks. How much do other countries charge for use of their tower? You are charging me $250 / Gb That seems excessive.
— Alan Levine ? (@cogdog) October 8, 2014
So let’s try some math. Here are the prices for my available plans
For my plan, $50 a month for 2 Gb, that works out to be $25/GB. This range from $40/GB to $17.5/GB. Or it looks more like You pay $40 for 1 GB and an additional $10/GB for anything above that. So I will use that $10/GB as a rate increaser for data over a 1GB baseline.
When in Roam, Verizon charges me $25/100Mb or $250/GB.
When in Roam, Verizon charges me 25 times as much per gigabyte for my data usage then when on their network.
Ask them why it costs so much? Does the cost of using another services network cost 250 times as much? Are those standard tower prices? Are cell providers gouging each others? Who knows? They cannot say.
@cogdog Thanks for asking. However, if you're looking for precise, incremental costs, that information is not available to the public.^DGM
— Verizon Wireless CS (@VZWSupport) October 8, 2014
Here’s another thing. When I activate international roaming, I am pegged $25 whether I use 100Mb or not. As soon as I hit 100.1 Mb I am pegged another $25. If I do not use any more, well, that 99.9 Mb of unused data just slides back into the coffers.
It’s an ingenious scheme for extracting money from travelers. Oh, and the more folks tweet, selfie, update… oh can you here all the coins clicking in the can? It’s almost like free money.
Verizon only offer a single option for data roaming, a flat rate like a taxi ride. There are no options if you are going to spend an extended period of time in Roam (I vaguely remember AT&T offering two levels of plan gouging).
Now I know what some will say. “Dude, get a pay as you sim” I’ve done that before. And it was an option for this stay in Canada. But I do have some friends and family who only contact me via my old school phone. And I am balancing the offset of the Data
Roaming Gouging charges by suspending my Mifi (that nets $20/month) and my home internet (saving $50/month).
It’s not maybe the smartest strategy for saving money. That’s not what I (think) am writing about. It’s how we are charged for things that have no relationship at all to the cost of providing it. If you think the cost of your airplane ticket is the actual cost of moving your butt from point A to point B…
In a supposedly in a Flattened World, there’s still room for companies to create these fences for which crossing them, as global citizens do, is a big fat cash pipeline. No disruption allowed in the profit zone, please keep moving along.
When in Roam, get gouged like Verizon does…