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Is Verizon's 4G Network Too Fast for Its Own Good?

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As a web and smartphone user, I worship at the alter of broadband. There are few technologies that emerged during my lifetime that can come close to the usefulness of high-speed Internet. But like any addict, I always want more. The fastest data connection just isn't fast enough. Anything less than instantaneous is too slow for my tastes.

So when a company like Verizon launches a new mobile network that increases data speeds tenfold, there's certainly a reason to rejoice. However, with the absence of unlimited data plans, that celebration can be short-lived.

How short? Well, at full speed, roughly 32 minutes.

While testing Verizon's 4G LTE network, PC Magazine's Sascha Segan hit an impressive 21Mbps. At that speed, subscribers could tackle giant files or streaming videos in little time. Unfortunately, they'll also hit the first 5GB data cap much sooner -- 32 minutes to be exact. After that, it's an extra $10 per gigabyte on top of the existing $50 per month plan.

But Segan estimates that the vacant network will begin to slow as more customers sign on. Even Verizon admits that the current average speeds of 15Mbps will slow to roughly 8.5Mbps on a loaded network. Regardless, that won't leave customers very long to enjoy the speeds.

Segan gave a rundown of different online scenarios, the speeds reached, and the time to reach the 5GB data cap.


In every case, customers will likely start paying extra by the time the month is over.

Segan expects the reason behind this is so that customers don't flood the network in the beginning. Once the company's confident it can handle the data load, the pricing structure could change. He also cites Verizon CTO Tony Melone explanation this week.

"As the network evolves, other aspects around our offerings will evolve as well, and pricing is an aspect of that."

That better be the case because, as it stands, Verizon's 4G network might be too fast for its own good.
POSITION:  No positions in stocks mentioned.

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