5G Today Is Just a Glorified Add-On

Mike Dano
7/3/2019
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Free Netflix. Free Hulu. Private WiFi. Oh, and 5G too.

And that's all available only on your carrier's most expensive unlimited plan.

Verizon has heralded 5G as powering the "fourth industrial revolution." Sprint promises it will "allow our customers to live a better life." But in practice, 5G mostly sits next to promotions like a free Apple Music account inside of operators' existing pricing plans.

Meaning, none of the nation's four big 5G providers has introduced new 5G pricing options like the operators in South Korea did when they launched 5G. Nor are they offering different 5G speed tiers, as Vodafone announced this week (Vodafone's 5G plans offer 2 Mbit/s for $29/month, 10 Mbit/s for $34/month or the fastest 5G speeds for $38/month).

Instead, US carriers are just cramming 5G into their existing, most expensive unlimited data plans.

"Wave7 Research believes that 5G offers far more sizzle than steak, but at least there is clarity on the initial 5G mobility revenue model. It is to sell more high-end unlimited plans," the research firm wrote in its latest report to subscribers. Wave7 carefully tracks US wireless operators' pricing and promotions.

Here's how things break down among the nation's four big nationwide wireless network operators, which are all now offering some flavor of mobile 5G:

Verizon

  • Verizon launched mobile 5G in parts of two cities for an extra $10 per month in April, but quickly withdrew that fee after complaints of spotty coverage and inconsistent results.
  • Verizon says 5G will still cost $10/month but that's now "free for a limited time," and there's no word on when that time will end. Further, 5G is only available on Verizon's "above unlimited" ($95/month for one line) and "beyond unlimited" ($85/month for one line) plans, and is not available on its "go unlimited" plan for $75/month.
  • Verizon's 5G hotspot is unlimited, which is noteworthy considering most operators put limits on tethering.

AT&T

  • Despite having "launched" mobile 5G last year, AT&T still isn't selling it to regular people. Instead, the carrier is only selling mobile 5G to its business customers who select its "unlimited preferred" plan for $90/month.
  • AT&T's 5G hotspot service includes 20GB of tethering, a relatively paltry amount that's roughly even with the amount of LTE hotspot data AT&T provides to its regular consumer customers.
  • There's no telling when AT&T will officially unveil its mobile 5G pricing for regular consumers, but it might do so later this year when it unveils its latest streaming video offerings.

T-Mobile

  • As promised, T-Mobile isn't charging extra for its 5G service. The operator has overtly positioned this tactic as a way to encourage regulators to approve its proposed merger with Sprint, but it also means that T-Mobile's 5G service suffers from the same limitations that constrain its LTE pricing plans. For example, on its $70/month "magenta" plan, T-Mobile only offers 3GB of hotspot data at LTE speeds.
  • T-Mobile confirmed to Light Reading that 5G is also available on its Metro by T-Mobile prepaid plans for no extra charge.

Sprint

  • Sprint's 5G service is reserved only for its $80/month "unlimited premium" plan, and can't be accessed on its $70/month or $60/month unlimited plans.
  • Sprint's hotspot data is capped at 100GB per month, for either LTE or 5G, after which connections are slowed to 3G speeds.

What does all this mean?
It means that 5G is being positioned as a way for operators to make more money by encouraging customers to upgrade to their "premium" plans.

Today's unlimited wireless pricing models in the US generally follow the standard "good, better, best" approach that has been applied to markets ranging from insurance to cable TV. The "best" category in wireless previously included items like additional hotspot data or subscriptions to music services like Tidal, but now they also generally include 5G.

It's true that this situation may eventually change -- Verizon's temporary $10/month suspension could be rescinded, and AT&T could apply a speed-based, tiered pricing paradigm to 5G when it eventually opens sales of the offering to consumers. But, here in the initial days of 5G, putting the industry's next big generation of wireless technology next to a free Amazon Prime subscription up on the "premium" shelf feels a little anticlimactic, to say the least.

Mike Dano, Editorial Director, 5G & Mobile Strategies, Light Reading | @mikeddano

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Duh!
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Duh!,
User Rank: Blogger
7/3/2019 | 1:52:51 PM
Translation
For now, 5G is a capacity play for their best customers.
mklevin
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mklevin,
User Rank: Light Beer
7/3/2019 | 12:36:19 PM
mobile-optimized page?
Clicked on the link in your tweet and got the desktop version of the article.  Is there no mobile-optimized version of the articles on this site?
brooks7
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brooks7,
User Rank: Light Sabre
7/3/2019 | 12:30:04 PM
Headline
I think that you drop the word "today" from your headline.

IF (and I am highly suspicious) there is a new killer application (gee I wonder if there is a wired version that might exist?), then it will NOT come from the infrastructure providers.  Sorta like expecting a pavement company to come up with a Tesla.  And Tesla's work on crappy roads with potholes.  

I stand by my statement that there is no killer app.  If there were it would be out there.  Internet Access, Email, Online Gaming all existed in dial-up.  Are they better now?  Why yes!  But they existed then.  The only app that we have that takes lots of bandwidth is video.  Again, a market that already exists.  And by the way, has Stadia taken over the world yet?

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