Smart Data Pricing

Chapter 17The Role of Multicast in Congestion Alleviation

ALAN D. YOUNG

17.1 Congestion in Cellular Networks

At the AT&T's analyst conference in New York on November 7th, 2012, Ralph de la Vega, the President and CEO of their Mobility Business said that AT&T's mobile network traffic has grown by 25,000% over the past 5 years. According to Cisco's Visual Networking Index (VNI) [1], mobile network traffic in North America will grow 17-fold between 2011 and 2016. These staggering increases in data consumption are of course mirrored in the wireline world too but increasing capacity in the wireline world can be achieved by upgrading infrastructure with more and faster equipment, to do the same in the wireless world requires more radio frequency spectrum. This is a resource, which is in increasingly short supply, and it is not at all clear that enough spectrum to satisfy the expected growth in demand can be obtained (at any price).

Indeed, the growth in data usage has been so dramatic that the unlimited data plans of a few years ago, used to drive the rapid growth of smartphones, are gone for good, as the operators try to ensure that they can support future growth and get a good return on their huge investments in wireless spectrum and infrastructure. However, merely trying to ration the remaining bandwidth and/or increasing the price might not be enough to deliver that return. Increase the price too much and growth will decline, limit the bandwidth user can use too much and the ...