Data market needs overhaul

The mobile app that allows me to check my monthly mobile usage recently told me I had used less the one-seventh of my monthly data cap more than halfway through the billing period.

I felt relief and distress at that same time. Relieved because it meant I had plenty of room to use data in coming weeks without worrying about going over the cap. Distressed because I had no idea why the app was giving this low of a reading.

As far as I could tell, I had used my smartphone as much this month as any other month, yet a fraction of the data I would normally use was consumed, or so the application said. It might have been a glitch in my favour, or it might have been an accurate reading; who knows?

I’m cognizant of mobile data usage and almost never go over my cap. I try not to access video or large files when I’m on the mobile network. I connect to WiFi whenever I can to divert as much data usage as possible away from my carrier’s network. Perhaps my diversionary tactics were particularly effective this month.

There are other times when I get rather close to my data cap, and those occasions are also puzzling. Perhaps I sometimes fail to take note of there being more emails than usual with pictures or other documents attached to them. There’s a news website that I like that has this quirk of playing videos automatically without the viewer choosing this option. Perhaps this technical annoyance happens more in some months than others, or perhaps I’m just on that website more in certain periods.

But I feel like I’m rather consistent in my mobile-Internet habits, yet my data usage seems to vary widely from month to month.

A few years ago, I found myself incurring overage charges periodically and was oblivious as to why. After spending a lengthy time talking with a service rep, we found there were particular days when my data usage would surge to unusually high levels. I eventually figured out these were days when I was travelling. It seems the GPS system was using a lot of data tracking my movements. Now I keep the location services on my phone off, much to the chagrin of geo-specific advertisers.

Data seems to have become the Holy Grail for mobile carriers. International Data Corp. estimated (subscribers only) that it would account for the most telecom-related spending worldwide next year and for the most growth in spending among any telecom segment. In Canada, Bell reported that wireless data revenue in the third quarter was up 23.9 per cent from the same period a year earlier. Earlier this year, Rogers indicated in its first-quarter financial report that data revenue in its wireless operations had exceeded the amount of money coming from voice services for the first time ever.

It’s pretty clear that carriers are counting on robust data usage as a pillar of future fortunes. The actions of the general public are clearly crucial to such expectations, yet because of the mystery surrounding how data charges add up and draw money from their pockets, consumers are not fully in control of their role in this deal.

Sure, people have a vague idea that more time online translates into more data usage, and the richer the media type, the richer the bill. But this is kind of like walking into a grocery store and the manager telling you, “The more you put into the cart and the better quality the food, the more we’ll charge you. But go ahead and get what you want and let us worry about the details.”

Carriers like Telus offer tips about what things are worth in data, such as an email with no attachments is around 4 KB, a webpage view is about 100 KB and a minute of YouTube viewing is around 2 MB. Still, these estimates can vary. You can never be sure of exactly how much data a website or application is using. Also, LTE networks and higher-quality phones translate into faster online access, which means your data count is accumulating quicker as the technology gets better.

Given how much money is changing hands for mobile data, it might be appropriate for a more specific value proposition to be placed in front of consumers. How this might happen is hard to figure out. It would be cumbersome to click your approval on a specific price or data allotment before any email, file or webpage made its way onto your screen.

Yet something more transparent would be beneficial for consumers and carriers. I already mentioned how I don’t turn on location services anymore because of uncertainty over how it will translate into data charges. That’s a lost marketing opportunity for various players. How many other mobile users are doing the same, not using TV apps on their smartphones, not shopping, not streaming music or not subscribing to data plans at all because the value-for-payment proposition is unclear?

The television model is likely to face adjustments in the near future as a result of the CRTC’s review of that industry. Yet what worked for many years in the TV business was an arrangement where you paid for access to channels. That payment would be higher if you subscribed to more channels and those of a premium quality, but your bill was not dependent on how much you watched those channels. You knew what you were going to owe at the end of the month whether you stayed up extra late a few nights watching more TV than you should, or you were too busy to watch much of anything.

Today, people purchase data from wireless and Internet providers like it’s a finite resource that will have to be restocked in time for next month’s order. The fact is data is free for the carriers, but the network they built to connect to your device was not. But neither was the local phone line to you parents’ house or their cable connection.

For the most part, telecom billing used to be more about access than usage. Long-distance calling was the exception, but in recent years phone-service providers, and especially wireless carriers, have found ways to make monthly charges related to long-distance calls affordable and predictable.

It’s time to make the data market more transparent and predictable. Not only would this make customers happier but it would make them more open to using the latest services available, which in turn would help grow the data market that much more.

Derek Abma is editor of The Wire Report. He can be reached at