Why Smart wants you off Unlimited Internet addiction

Yugatech recently published that Smart Bro Rocket cuts the UnliSurf plans off its pricing option list, and according to the site the company intends to start offering Internet in bucket plan by September 30 — at Php180 per 200MB. Smart Bro Rocket is Smart’s new Internet dongle that uses its much advertised “4G”. It is a push for faster mobile Internet. There are in fact several things happening.

The Smart Bro Rocket is a move to convince the market to go back to first, dial-up days where people pay for Internet by the minute. Second, Smart wants to be able to aggressively gauge how much bandwidth it will buy. Third, the move is an effort to keep the early adopters from getting too addicted to the speed. People who will buy the Rocket, without doubt will be some of the heaviest users in the Philippines. Fourth, it signals the level of preparedness the company has– infrastructure-wise. It is a way to manage expectations, public relations-wise.

Let’s begin with Always on. You will notice Smart has been aggressively pushing for the Always On series of plans. This is one of the many options the company is making in an effort o get people off the idea of unlimited Internet.

Does that mean, Always On is bad for the consumer?

It would depend on what type of consumer you are.

The Always On series is actually pretty good deal for your smartphone. That’s a smartphone that you use only to send email, read tweets, update your Facebook status. Things, mobile devices like phones are good for. Payload for this type of job isn’t huge.

Put it another way, if you typically read 10MB of powerpoint via email on your phone, while on the go, you probably will be on the top end of that Always On plan, whereas if you just tweet and Instagram, well, the middle tier is probably where you are at.

So buying gigabytes in bulk isn’t so bad in that regard.

Now, when you apply the same thing to say a Smart Bro Rocket that you would typically use on a notebook for work, and play, that’s a different thing. For people like me who typically upload and download megabytes of data to my client websites, and to my own servers, that’s something to shy away from.

Could you imagine advertising agencies passing gigabytes of data on thumb drives (usb drives)? Yeah, it is called “Sneakernet“, because you walk to send data. I still find it incredulous that top advertising and PR companies in the Philippines— like all of of them— would prefer to meet just to pass along thumb drives of data for uploading. These agencies are without a doubt some of the heavy users of data. Videos and pictures are heavy on the bandwidth.

I also find it incredulous that some of these shops pay upwards of 25 thousand pesos for 1Mbps of Internet. YES, they do. In my opinion, that’s highway robbery.

It is that bad.

iPhone Developers too are constantly downloading gigabytes of software update. Xcode is one of those pieces of software that requires you between 1GB to 4GB just to update. This is why I am always hammering that Broadband Internet is like roads and electricity— there is an economic benefit to having, fast, reliable Internet. Knowledge workers are at the heart of digital, and goes beyond the typical BPO industry.

Smart for instance charges 10 pesos per 30 minutes. So that’s 20 pesos per hour. On a minimum of 12 hours per work day that’s 240 pesos per day. Let us assume that as a knowledge worker you spend 10 days out of 30 days, mobile. That’s 2,400 pesos for a Smart Bro Rocket.

Smart also offers what they call the “Power Plug-it”. According to their website, it goes up to 5Mbps. This is the sweet spot, of Smart’s offer for knowledge workers on the go. It has the unlimited Internet option.

The weird part in the pricing is that Smart seemingly doesn’t want to up-sell. The rocket goes up to 12mbps, sure when you’re in range of a HSDPA+ tower, but it crawls down to the power plug-it speed level when you don’t. The plus part of having Rocket in their arsenal does much more for Public Relations than anything else. It would help mitigate the “you are not upgrading your infrastructure” argument. They go, “hey look it, we have this. Buy it if you want that speed”. I suppose such a pricing move is a good way to manage expectations as well, and avoid the Rocket-is-slow-bad-pr from users who don’t know. It also shows that the telco isn’t ready yet for that kind of speed level, infrastructure-wise.

Using a Smart Bro power plug-it in Makati, by the way is awesome. You can even play an MMORPG on it. Downloading stuff via iTunes isn’t so bad either. Try going South and past Alabang, and you get a paper weight device. I should know. Done it early in the morning, going to and from Makati to Batangas and vice versa.

People want to up-sell, as much as possible right?

So what of the competition? Globe Telecom on the other hand has a competing Tattoo product, which co-incidently was hammered by bad news when it was embroiled in a trademark dispute, but the product remains on Globe’s Tattoo website. The company has mostly died down their aggressive push. Visit their website today, and it doesn’t even mention their mobile broadband Tattoo product. They mention pricing plans for their phones, but even mobile internet, but not the Tattoo product, which is on a separate subdomain. And there is no link to that subdomain on the main site. That of course says a lot more about the state of Globe than the lousy state of Internet competition in the Philippines.

The introduction of Always On product is for the most part a good thing for people on mobile phones, it isn’t a good thing for people using a lot of data. Always On is, another way of saying “Data Cap”, after all, and like I said, there is perfect fit for it on phones, and enhances the telco product line. It is a good way to stay online because all phones do is keep you on Twitter, Facebook, and Email, and news feeds. It is similar to Blackberry plans.

What’s happening is the commodification of the Internet.

As a consumer, it is up to you to consider which is best for you. As a consumer, your use case will probably be getting an Always On for your phone, and going unlimited for the rest of your Internet needs. For people like me, it would be getting multiple Internet lines for the home office, unlimited on mobile, and backups for backups. So there’s just no one option. You get a variety, per device, per mission requirement, so to speak, hence the term, “commodification”. It is how Telcommunication companies are trying to avoid being just “public utilities”. From the corporate perspective, it is a genius way to make more money.

The dangerous thing is when Always On bucket plan eases its way up the other mobile broadband offering, and becomes default for telcos offer Internet, and rids the market of the unlimited series. At the rate government has been setting rules on that regard, the consumer simply has no protection whatsoever, maybe expect market forces will decide which will succeed.

Hat tip to @brinknotes for the Yugatech link.

Cocoy Dayao

Cocoy is the Chief Technology Officer of Lab Rats Technica, a Digital Consulting company that specialises in DevOps, iOS, and Web Apps, E-Commerce sites, Cybersecurity and Social Media consulting. He is a technology enthusiast, political junkie and social observer who enjoys a good cup of coffee, comic books, and tweets as @cocoy on twitter.

Cocoy is also the Managing Director and Editor-in-Chief of the ProPinoy Project.

Cocoy considers himself to be Liberal.

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  • Anonymous

    SMART seems to price their products on this weird notion that  two customers should not be charged the same amount if one of them uses 40 or more  times the bandwidth of the other.  

    Another pricing scheme, of course, is USA-telco-style which puts a 30%-overbill-penalty on the lower-utilization-per-month customer in order to subsidize the heavy-bandwidth user.