Apple faces concerns over iPad 'speed trap'

It has been only five days since users of Apple's newest iPad first took the device out of the box, and some are now finding just how quickly the promise of superfast wireless connections collides with the reality of what those services cost.

Brandon Wells got the new iPad last Friday, started wirelessly streaming March Madness games the next day and by Saturday night, was out of gas.

Two hours of college basketball -- which he viewed mounted to his car dashboard and live at tournament games -- had burned through his monthly wireless data allotment of two gigabytes.

Now, to keep surfing the web or watch more NCAA hoops over Verizon Wireless's 4G network, Wells will have to pay an extra $10 for every gigabyte above his current $30 subscription.

The iPad's new high-resolution screen and fast connection are specifically designed to spur greater use of online video -- a long-stated goal for phone companies, as well as technology purveyors such as Apple and Google.


Telecom companies in particular are banking on mobile video to drum up demand for their new, fourth-generation networks and create new revenue streams as they adjust to the smartphone age.

That means something has to give -- either consumers will have to get used to paying more, or wireless carriers will come under pressure to change their pricing models.

Verizon declined to comment on its pricing strategy but said customers can pick higher-use plans, or they can go easier on their data allotments by shifting to Wi-Fi networks when they are available.

Wireless carriers have been rolling out multibillion-dollar networks that use a high-speed technology called LTE.

Suffering from a decline in voice-calling revenues, they hope that LTE boosts monthly bills for wireless service, as they charge by the amount of data consumed. Thirty dollars a month buys two gigabytes of data at Verizon and three gigabytes at rival AT&T.

"It's kind of a Catch-22," according to Wells, a 31-year-old web developer who decided to pony up for another gigabyte. "With LTE, the quality and the streaming is fantastic. But man, you're really limited in terms of the amount of content you can consume."

Read more about Apple's new iPad at The Wall Street Journal.