When Walmart swooped in to announce a prepaid iPhone 5 for use with its BYOD (bring your own device) unlimited Straight Talk plan, it seemed like a decent deal. While $649 is a big chunk of change, shoppers who use a Walmart credit card for the purchase can spread out those payments for $25 per month with no interest, and get unlimited voice, text and data for just $45 per month. That’s a bargain, compared to subsidized pricing with contracts.
Walmart’s pre-paid service is no stranger to iPhones, as people regularly bring in their Apple devices for activation on its Straight Talk plan. But now the retailer will be selling the iPhone 5 and iPhone 4 directly to customers for use…
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Starting December 17th, Walmart stores will sell the 16GB iPhone 5 for just $127 with a two-year agreement. Additionally, it appears the price of the iPhone 4S will be lowered to $47, also tied to a two-year contract. Update: You…
But now, a week after it launched, the cracks are starting to show. Some people familiar with Straight Talk believed that the service — via MVNO (mobile virtual network operator) — throttled users after a certain point. What they weren’t clear about, however, was what the tipping point is. According to Mashable, there’s now more clarity: The threshold is 2GB — which pretty measly in this hi-traffic, streaming, cloud-computing era. After users hit that mark, they get throttled back to the Stone Age, i.e. sub-2G speeds. While technically, it might still barely count as unlimited, that would have to be a pretty loose definition. At those speeds, it’s practically impossible to do anything.
Now, I’m not against plans that throttle — there’s a place for discount options like these — but the obfuscation is ridiculous, and that’s partly because it’s so commonplace. Walmart isn’t the only provider that promotes one thing while sneaking in restrictions that practically eradicate it, and that makes it tough for shoppers to make informed choices.
If you’re a budget iPhone 5 shopper with ready access to Wifi or very light data needs, Walmart’s deal might still be worth your while. But anyone else who actually needs unlimited text and data from their unlimited data may want to look elsewhere.
UPDATE: A Straight Talk representative emailed us in response to this post:
“The few customers who experience throttling of their data service are engaged (knowingly or unknowingly) in one or more prohibited uses. Two examples of the most common prohibited uses are tethering the phone to other devices to access the internet or continuous video streaming. The vast majority of Straight Talk customers have no complaints about or issues with its data service.”
The rep, who prefers to remain anonymous, denied that there is a universal threshold that applies to all users. That doesn’t mean there’s no throttling, just that it happens on a case-by-case basis:
“Straight Talk monitors its customers’ data usage patterns to detect users in violation of terms and conditions in order to ensure that all customers enjoy a quality experience. For that reason, they do not have fixed thresholds for throttling. Rather, they are continuously monitoring use and will adjust thresholds as necessary in order to maximize all of its customers’ experience.
“Customers engaged in a prohibited use will receive a warning and they have an opportunity to troubleshoot their usage patterns to identify and correct any problems. If problems are identified, customers will be given recommendations to improve their data experience (for example, for continuous video streaming, they will be advised to use Wi-Fi where available).”
If you’re a power user who needs to tether or stream a lot of content, you’ll want to take particular note of this. And it doesn’t hurt to check out Straight Talk’s Terms and Conditions, to make sure your needs are covered.