FreedomPop's free data pitch is aimed at the thrifty consumer: put down a refundable deposit on a USB dongle or MiFi-style router (iPod touch cases are also an option) and receive a monthly 500 MB bandwidth stipend for life. For free.
If it sounds too good to be true, well, it might be. But before I get to that, let me give you a general idea of where FreedomPop is coming from.
FreedomPop is currently a Clearwire 4G WiMAX rebundler (they will be moving to Sprint in 2013). You can use FreedomPop's equipment in any area that Clear currently services. You choose from three plans:
- Free 500 MB - US$0/month for the first 500 MB and then $0.02/MB after. That's $20.00/GB. This is the bottom feeder plan that many consumers will choose.
- Casual 2 GB - $18/month ("for a limited time") for the first 2 GB, and then $0.01/MB after, or $10/GB.
- Premiere 4 GB - $29/month ("for a limited time") for the first 4 GB, and then $0.01/MB after, the same $10/GB as Casual.
Leaving family plan sharing aside, the Casual and Premiere data compare well to major carriers. AT&T's 250 MB/month plan costs $15 and $30 for 3 GB. Sprint offers 300 MB/month for $15 and 3 GB for $35. Verizon's offerings include 1 GB for $20 and 2 GB for $30. As you can see, FreedomPop's paid plans are competitive.
What's more you can share this data among multiple devices if you select the Freedom Spot hotspot. It supports up to 8 devices at once, and offers up to 6 hours of use according to FreedomPop's marketing text.
Penny Pinching Data Usage
My concerns surround the Free 500MB plan. I suspect most users will choose this plan. I don't see how this loss-leader approach readily extends towards a revenue stream to ensure the company's health and longevity.
That's because frugal users will likely disable FreedomPop's automatic top-off feature. In its default configuration, user accounts for the free plan auto-renew to paid $20 top-offs after 400 MB of bandwidth is used. Users can easily switch this feature off. (Set Billing > Billing Settings > Automatic Top Up > Enabled to No.)
So where else can FreedomPop earn from its free users? It provides a low-rent data-for-completed-offers program. Sign up for clubs, mailing lists, surveys, etc. and FreedomPop extends your free data with one-time boosts.
I honestly think users would probably prefer to pay $5 or $10 a month for the same 500 MB data plan and ensure the company's long-term health than see it try to make a go of it with this kind of low-end "sell your consumer information" approach.
That's because unbundled data is a precious commodity, and one that's hard to find frugal solutions for. Ever since AT&T killed their data feature plans back in April, it's been something that many users have done without.
As a point of comparison, Clear's unlimited data plans cost $35 and $50 for basic home and mobile use. These provide excellent alternatives for the high-end data consumer. It's the low-use, on-the-go consumer, who lives in areas with plentiful Wi-Fi who struggles to find an affordable solution for filling coverage gaps.
Tony Miller, FreedomPop's marketing VP, has given hints that the company will try to build additional revenue streams by adding services like VoIP. I'm not convinced that this will work.
It's not hard to beat AT&T's 3G (aka "4G") data service if you live in Denver. As you can see from the SpeedTest.net screencap that follows, AT&T's service is just awful. And yes, I live in a supported area.
Interestingly enough, I live outside the supported Clear zone. I'm in one of their "partially covered" rather than fully covered locations. (This translates to light green vs dark green on their service map.)
FreedomPop's Clear-powered WiMAX data absolutely smokes AT&T, both at home and around town. Here's a typical test from my iPad, when connected through the Freedom Spot. Be aware that each test consumes a fair portion of your monthly allowance, so you don't want to be running many of these tests unless you're doing a write-up for a blog.
Steve Sande, who lives about 10 miles south of me, uses Verizon on his 3G iPad. He regularly sees data numbers equal to or better than these while around Denver. Steve is in the middle of changing his iPhone AT&T service to Verizon for exactly these reasons. I may follow next year, when my current AT&T contract is up.
FreedomPop will be switching from Clear's WiMAX network to Sprint's LTE next year.
As much as I love the budget data FreedomPop is offering, I do have concerns about the company's long-term health. Their low-end Free plan doesn't seem fully thought out to me. If you sign up, keep that in mind.
At the same time, I've developed respect for Clear -- a service I never had an opportunity to test before. A quick Google search revealed mixed experiences with Clear customer support, but after this test, it's a service I'd consider using. I think it might work particularly as an alternative to my current iPhone-as-primary-data-consumer lifestyle, especially now that Apple offers the iPad mini.
I'm holding onto the FreedomPop for a while, to continue testing. Here's hoping the company can make it work. I'm just not convinced it can.
*Verizon has acquired AOL, Engadget's parent company. However, Engadget maintains full editorial control, and Verizon will have to pry it from our cold, dead hands.