• Home
  • Latest
  • Fortune 500
  • Finance
  • Tech
  • Leadership
  • Lifestyle
  • Rankings
  • Multimedia

Trendingnow

1

Gen Z fled San Francisco for Texas and Florida. Now they’re turning ‘welcomer cities’ into the next big tech towns

2

Melinda French Gates' advice to new IPO millionaires: 'Give half your money away'

3

Trump expects to sign a deal with Iran on Sunday, but Tehran may want to avoid giving him a gift on his birthday

1

Gen Z fled San Francisco for Texas and Florida. Now they’re turning ‘welcomer cities’ into the next big tech towns

2

Melinda French Gates' advice to new IPO millionaires: 'Give half your money away'

3

Trump expects to sign a deal with Iran on Sunday, but Tehran may want to avoid giving him a gift on his birthday
TechGlobal 500

How Booming Mobile Video is Pushing Carriers to Lower Quality

By
Aaron Pressman
Aaron Pressman
Down Arrow Button Icon
By
Aaron Pressman
Aaron Pressman
Down Arrow Button Icon
November 14, 2016, 2:20 PM ET
The Periscope video streaming site logo is displayed on the screen of an Apple Inc. iPhone in this arranged photograph taken in London, U.K., on Friday, May, 15, 2015. Facebook Inc. reached a deal with New York Times Co. and eight other media outlets to post stories directly to the social networkÕs mobile news feeds, as publishers strive for new ways to expand their reach. Photographer: Chris Ratcliffe/Bloomberg
The Periscope video streaming site logo is displayed on the screen of an Apple Inc. iPhone in this arranged photograph taken in London, U.K., on Friday, May, 15, 2015. Photograph by Chris Ratcliffe — Bloomberg via Getty Images

AT&T announced last week that it planned to degrade the quality of all streaming video for its mobile customers by default next year, though it would provide them with a free option to switch back to full quality video at any time.

In some ways, it’s another copycat move by a large carrier to duplicate a strategy of the smaller carriers Sprint and T-Mobile. AT&T and its even larger peer Verizon have copied one or both of the smaller carriers in eliminating two-year contracts, eliminating data overage fees in favor of slower data rates, and many other features.

T-Mobile first created a lower quality data option—which saves the carriers from having to handle massive amounts of wireless bandwidth—a year ago with its Binge On program. Video watched at the lower quality didn’t count against customers’ monthly data allowance. Then over the summer, both T-Mobile and Sprint created new, cheaper unlimited data plans that, in return for the price cut, automatically reduced video streaming quality.

Sprint CEO Marcelo Claure, defending the downgrade from high-definition video to DVD quality, said 90% of customers didn’t notice any difference in tests. T-Mobile (TMUS) said when it offered customers a choice of watching higher quality video, 99% stuck with the lower setting.

That can’t help but have made an impression with execs at AT&T (T) and Verizon (VZ). After all, the booming increase in customers watching streaming video had been threatening to stress the capacity of all four carriers’ networks eventually. A study last year from Ericsson predicted mobile video would increase to 70% of all data traffic by 2021 from 50% in 2015 over the same period that overall data traffic is predicted to increase seven-fold.

The coming squeeze is likely to be more acute for the larger carriers. That’s because, with many more customers than the smaller carriers, AT&T and Verizon have less spectrum capacity per user. Verizon has just 1.02 MHz of spectrum per connection and AT&T has 1.18 MHz compared to 1.37 MHz per connection for T-Mobile and 3.64 MHz at Sprint, according to a review by Recon Analytics last year.

The next generation of mobile transmission technology, known as 5G, will offer relief from the squeeze with massively greater wireless capacity. But 5G is still three to five years—at least—from widespread adoption.

So reducing the quality of video that customers watch on their phone screens, where it’s much less obvious than on, say, a 60-inch television screen, is a savvy short-term solution.

The only potential glitch is that while T-Mobile and Sprint (S) offered customers concessions, such as lower prices or data usage exemptions, in return for downgraded video, AT&T isn’t offering its customers anything.

AT&T emphasizes that it is allowing customers to switch back to high definition video for free, while Sprint and T-Mobile charge more to move up from DVD quality on their new unlimited plans. But that ignores that the two smaller carriers cut prices when they introduced the plans in the first place. Sprint’s older unlimited plan, which did not reduce video quality, cost $100 a month versus $60 for the new plan, for example.

AT&T’s popular six gigabytes per month plan costs $80 monthly now and will cost the same when the carrier switches to downgraded video quality by default early next year.

Both smaller carriers have had success luring away regular, monthly phone customers from AT&T and Verizon by bashing their larger competitors for being less customer friendly. After AT&T announced the stream saver feature last week, T-Mobile CEO John Legere was bashing them again.

“How do we know what @ATT will do (wrong) a year from now? Just look at whatever we do now & make it suck,” Legere tweeted.

Time will tell whether the feature copying can continue without having an impact on price.

About the Author
By Aaron Pressman
See full bioRight Arrow Button Icon

Latest in Tech

Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025

Most Popular

Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Fortune Secondary Logo
Rankings
  • 100 Best Companies
  • Fortune 500
  • Global 500
  • Fortune 500 Europe
  • Most Powerful Women
  • World's Most Admired Companies
  • See All Rankings
  • Lists Calendar
Sections
  • Finance
  • Fortune Crypto
  • Features
  • Leadership
  • Health
  • Commentary
  • Success
  • Retail
  • Mpw
  • Tech
  • Lifestyle
  • CEO Initiative
  • Asia
  • Politics
  • Conferences
  • Europe
  • Newsletters
  • Personal Finance
  • Environment
  • Magazine
  • Education
Customer Support
  • Frequently Asked Questions
  • Customer Service Portal
  • Privacy Policy
  • Terms Of Use
  • Single Issues For Purchase
  • International Print
Commercial Services
  • Advertising
  • Fortune Brand Studio
  • Fortune Analytics
  • Fortune Conferences
  • Business Development
  • Group Subscriptions
About Us
  • About Us
  • Press Center
  • Work At Fortune
  • Terms And Conditions
  • Site Map
  • About Us
  • Press Center
  • Work At Fortune
  • Terms And Conditions
  • Site Map
  • Facebook icon
  • Twitter icon
  • LinkedIn icon
  • Instagram icon
  • Pinterest icon

Latest in Tech

SpaceX surge further boosts Saudi billionaire prince’s fortune
InvestingSaudi Arabia
SpaceX surge further boosts Saudi billionaire prince’s fortune
By Adveith Nair and BloombergJune 14, 2026
2 hours ago
Wall Street is gaining access to new catastrophe models to help predict wars
BankingWar
Wall Street is gaining access to new catastrophe models to help predict wars
By Gautam Naik and BloombergJune 14, 2026
2 hours ago
People wait outside a building
AIJobs
AI job disruption is here. The problem may be compounded because nearly 75% of people don’t apply for unemployment benefits
By Jacqueline MunisJune 14, 2026
2 hours ago
Just months after Trump warned states not to regulate AI, Republican and Democratic lawmakers are doing it anyway
Politicsregulation
Just months after Trump warned states not to regulate AI, Republican and Democratic lawmakers are doing it anyway
By Marc Levy and The Associated PressJune 14, 2026
2 hours ago
Bryan Catanzaro sits in a gray chair in front of a blue and green background.
AINvidia
‘The cost of compute is far beyond the costs of the employee’: Nvidia executive says right now AI is more expensive than paying human workers
By Sasha RogelbergJune 14, 2026
2 hours ago
SpaceX went from three consecutive rocket explosions and near-bankruptcy in 2008 to the biggest IPO in history
Startups & VentureSpaceX
SpaceX went from three consecutive rocket explosions and near-bankruptcy in 2008 to the biggest IPO in history
By Marco Quiroz-GutierrezJune 14, 2026
5 hours ago

Most Popular

Gen Z fled San Francisco for Texas and Florida. Now they’re turning ‘welcomer cities’ into the next big tech towns
Real Estate
Gen Z fled San Francisco for Texas and Florida. Now they’re turning ‘welcomer cities’ into the next big tech towns
By Sydney LakeJune 13, 2026
1 day ago
Melinda French Gates' advice to new IPO millionaires: 'Give half your money away'
Startups & Venture
Melinda French Gates' advice to new IPO millionaires: 'Give half your money away'
By Emma HinchliffeJune 13, 2026
1 day ago
Trump expects to sign a deal with Iran on Sunday, but Tehran may want to avoid giving him a gift on his birthday
Middle East
Trump expects to sign a deal with Iran on Sunday, but Tehran may want to avoid giving him a gift on his birthday
By Jason MaJune 13, 2026
20 hours ago
'It's not a jailbreak' — Research leading to U.S. export restrictions on top Anthropic models was for defense, cybersecurity CEO says
AI
'It's not a jailbreak' — Research leading to U.S. export restrictions on top Anthropic models was for defense, cybersecurity CEO says
By Jason MaJune 13, 2026
23 hours ago
SpaceX CFO Bret Johnsen quietly engineered its historic IPO and became an overnight billionaire
C-Suite
SpaceX CFO Bret Johnsen quietly engineered its historic IPO and became an overnight billionaire
By Sasha RogelbergJune 13, 2026
1 day ago
Anthropic disables Fable and Mythos AI models after U.S. government bars it from giving foreigners access
AI
Anthropic disables Fable and Mythos AI models after U.S. government bars it from giving foreigners access
By Jeremy KahnJune 13, 2026
2 days ago

© 2026 Fortune Media IP Limited. All Rights Reserved. Use of this site constitutes acceptance of our Terms of Use and Privacy Policy | CA Notice at Collection and Privacy Notice | Do Not Sell/Share My Personal Information
FORTUNE is a trademark of Fortune Media IP Limited, registered in the U.S. and other countries. FORTUNE may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.