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Old 05-17-2006, 01:01 PM   #19 (permalink)
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Originally Posted by calkenneth
And about the tethering, my question was more around what the difference in technology is that would make it a different transport method, thus incurring charges.
Probably no difference on a technical basis (unless you expect free tech support, which would incurr additional costs for the carrier). The difference is the class of device you are using to connect. The carriers seem to agree on roughly three classes of devices and bill you at three price points.

$5-$20/mo for internet on a basic flip-phone or candy bar phone

$20-$40/mo for internet on a PDA phone

additional $7-10 for BlackBerry on top of what a PDA plan would cost (ca.$30-$45 total)

$55-80/mo for laptop/notebook PC access.

I don't think the basis that "one would use less bandwidth on a flip phone" is true anymore, especially not with things streaming video. So that argument is largely out. The carriers just seem to be using a pricing model depending on the class of device you are using, figuring that you would pay more. I believe the economics term is called "price discrimination" and it's about maximizing profit. I can't say I blame them. But the consumer has been conditioned for a while now that "bits is bits" and you're just paying for bandwidth, presumabling on the "all you can eat" menu that we're all used to with home access (dialup or broadband).

It's about making sure you get plenty of crippled flip phones buying internet at cheap rates, while still getting the PDA and notebook power users to pony up more dough.