"4G" Hype and Need for Transparency Rules

Advertisements from mobile providers touting their new 4G network as the "fastest" or "most advanced" in the nation are everywhere at the moment. But beyond marketing slogans of "lighting fast" and "supercharged," most consumers have little understanding of the service beyond these superficial terms, or of just how unrelated the self-identified '4G' label is to the actual performance capabilities of a particular network or device. Despite such limited information and understanding, according to one market survey at least 3 out of 10 consumers plan to upgrade to 4G in the next 12 months.

To fill this consumer protection void, Congresswoman Anna Eshoo has introduced legislation, "Next Generation Wireless Disclosure Act" that would require accurate disclosure to consumers of the terms and conditions of '4G' and other advance wireless mobile broadband service. The bill calls for, among other things, the clear and prominent disclosure of the actual price, minimum speed, network reliability, and network management practices for a service in all marketing materials, at the point of sale, and in all bills for a service. 

'4G' hype and the need for a "guaranteed minimum" speed

The Open Technology Initiative (OTI), along with other public interest and consumer groups, have long called for for strong rules to require all broadband providers to disclose accurate information to consumers regarding the actual speed, cost, and terms of use of their services. OTI also developed a broadband 'nutrition label' that if enacted would allow consumers to more easily compare broadband services across different plans and providers.

OTI's Sample Broadband Label

Among the elements of that label was the required disclosure of a minimum speed or a 'guaranteed minimum' by providers that would serve as kind of a floor and a more honest counterpoint to the often inflated 'up to' speeds that generally act as a ceiling for different tiers of broadband service.  Eshoo's bill also includes the disclosure of a "minimum transmit and receive speed" for a service. 

Consumers rarely get close to "up to" speeds, making them a poor metric to assess the actual speed of a service.  A report by the Federal Communication Commission found that "actual download speeds experienced by U.S. consumers appear to lag advertised speeds by roughly 50%." Back-to-back studies by the UK's broadband regulator OFCOM, similarly found consumers generally received around half of the advertised "up to" speeds.  Those studies were based on wired or wireline broadband services such as DSL and cable, advertised "up to" speeds are even more useless for mobile broadband service, where an increasing number of factors can impact the actual speed a consumer is likely to receive.  The same aforementioned FCC report also noted a study that found actual mobile broadband speeds to "be a quarter of the speeds advertised."

Despite such variability, mobile providers are pushing ads that hype their '4G' service as the fastest network in the nation.  As my colleagues James Losey and Chiehyu Li noted in an article with Ars Technica:

"The problem comes down to what “4G” really means. The buzzwords flying around the US mobile space are Long Term Evolution (LTE), HSPA+ and WiMAX. However, before this past December, the International Telecommunications Union (ITU), the global standards-setting body responsible for ensuring some level of interoperability in mobile communications, had set the 4G standard as LTE Advanced—technology that is not expected to be deployed until 2012 at the earliest."         

However, '4G' is now recognized to not only include next generation LTE and WiMAX technolgies, but also other evolved 3G technologies that vary significantly in terms of their network capacity and speeds. As Losey and Chiehyu offer, "[t]rying to understand 4G can give you a bit of a headache;" and they both work on telecom policy. Of course for providers such as AT&T this makes perfect sense, as they would rather compete on the basis of advertising and gadgets than on actual speeds their network provides.  But what's good for the AT&T goose, is not necessarily great for the gander - the consumer. For example, AT&T was more than happy to sell consumers 4G ready Motorola Atrix devices, even if their 4G network technology (HSUPA) is not actually up and running yet.  Thus, a consumer expecting 5.5 Mbps upload speeds that HSUPA is capable of providing, will only have access to upload speeds of around 300 Kbps.

Such wide discrepancies among '4G' advertised services are common.  A recent study comparing supposedly similar 4G mobile networks in the San Francisco area found speeds varied by as much as 4 Mbps. But beyond these few studies, consumers have little means to accurately compare the actual speeds of mobile broadband services. This is where a guaranteed minimum would be extremely helpful to a consumer.

The minimum guaranteed speed would be established solely by the mobile provider, but require them to make this absolute bare minimum speed available to consumers the vast majority of the time. Consumers could certainly get more than the minimum speed, but they should never get less.  Thus, rather than competing on unrealistic "up to" speeds, providers would compete in terms of a more realistic and reflective measure of a service's network capacity and performance. 

The idea of a "guaranteed minimum" is not entirely new, and mirrors a proposal from Internet papa Vint Cerf as well as standard network guarantees established through Service Level Agreements (SLAs) that are common among business class broadband service. In such, SLA's providers guarantee they will provide a minimum level of service on a number of performance metrics including speed, uptime, and latency. Hungary also recently implemented rules that require the nation's broadband providers to disclose a guaranteed minimum to consumers.

Nowhere would this metric be more useful than the vast wasteland of 4G hype.