Two months ago, Karma launched Neverstop, its first take on a subscription data plan. Since then, the company says that 90 percent of new customers have opted for Neverstop instead of Karma's traditional pay as you go options. But along with the high level of interest in the service, Karma says that some of its customers have found ways to use the service as their home internet, including backing up large amounts of data. As a response, this week the company revealed to users that it will be lowering the speeds of Neverstop in an effort to discourage this kind of activity.
In an email sent to its Neverstop customers, Karma said "we began running tests to optimize the service, including lowering speeds." CEO Steven Van Wel confirmed to me that the speeds used during Karma's testing phase range from 1.5Mbps to 2.5Mbps, though the company hasn't yet settled on a speed that it feels will work to resolve the problem. When the service launched, the download and upload speeds were capped at 5Mbps, so these reductions do make for a significant decrease in speed. Customers that are unhappy with the change are able to cancel their service and apply for a refund.
59 percent of Neverstop customers use it for home internet
Van Wel says that a small percentage of its Neverstop customers have racked up usage in the hundreds of gigabytes, and that 59 percent of ones that responded to a survey said they use Karma Go for their home internet. Some have even found ways to bypass Karma's captive portal system, which is designed to prevent the use of home video streaming devices such as Apple TV or Chromecast and gaming systems like the Xbox One or PlayStation 4. Van Wel says that the service was never designed for these use cases, and if it is just used for mobile internet access from a phone, tablet, or laptop, the usage rates would not be excessive. The company is currently looking for ways to prevent this kind of activity without having to cut off service to these users entirely.
This kind of issue is not new in the wireless industry: large wireless carriers such as AT&T have imposed speed restrictions on their unlimited data plans in an effort to discourage large amounts of data usage and protect their networks. As an MVNO of Sprint, Karma is more concerned with controlling costs imposed by these outlying users, and Van Wel says that in order to support this kind of usage, costs need to be lower and wireless networks need to be improved. That said, it may be a few years before we get to a point where you really can use a wireless data plan as your home internet.