Mobile Data: Smartphone Plans Creating Wireless Waste

How supersized smartphone plans and mobile data cause consumers to waste their dollars.


| November 2014



Mobile Data

American smartphone users spend an average of $200 a year for excess mobile data, adding up to $52.8 billion of national wireless waste a year.

Photo by Fotolia/bexxandbrain

Smartphones are becoming one of the most widely used devices in the world, with vendors shipping more than one billion smartphones in 2013 alone. In The Smartphone (The New Press, 2014), author Elizabeth Woyke offers readers an in-depth look into the smartphone industry, including some of its more troubling aspects. This excerpt, which is from Chapter 5, “Waste: Money and Trash,” discusses how smartphone plans cause consumers to overpay for the mobile data they use from day to day.

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Excess Mobile Data Ends Up In The Wireless Waste Bin

Every day, when Todd Dunphy checks his e-mail, he finds messages from people begging for assistance with their smartphone plans. One December 2013 e-mail came from a person who was paying $1,200 a year for unlimited service but only using 150 voice minutes, 25 text messages, and a scant amount of mobile data each month. The issue wasn’t the person’s smartphone—a Galaxy S model that the phone’s owner liked—but the expense of the accompanying plan. “I just feel like I am paying so much money for services I don’t use, but [I can’t] find a very good [alternative] option,” the owner explained. “Please help!!!”

Dunphy has been receiving these kinds of “Please help!!!” e-mails for years. He is a former Verizon Wireless salesman, and in 2007 he co-founded a mobile analytics firm called Validas to save people and consumers money on their wireless service. The Houston, Texas–based company analyzes the cellphone bills of companies, government agencies, and consumers for extraneous charges using its own software. As a result, Validas claims to now have amassed the largest collection of wireless bill information in the United States outside of the carriers.

Sifting through the data, the company says the biggest trend in spending habits is wireless waste—the gap between the service capacity people sign up for and the amount of that service they actually use. Says Dunphy, “the only way I win, as a smartphone consumer, is when I perfectly buy and use [an exact number of gigabytes], which never happens.”

We all like to think we’re savvy shoppers. Yet Validas’s data shows that most of us spend more than we need to on wireless service month after month, year after year. Validas estimates 80 percent of American wireless subscribers are paying carriers $200 a year for excess minutes, messages, and data. On a national level that adds up to $52.8 billion of wireless waste a year. On a global level the figure could be as high as $926 billion, Dunphy says. Smartphones are the biggest source of wireless waste, because their plans are particularly expensive and complicated. According to Validas they are responsible for $45 billion, or 85 percent, of the United States’ total overspending on wireless service.