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Karma restores unlimited speeds, but throttles after 15GB

"We made a mistake," Karma's CEO says.

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There's good news and bad news for Karma hotspot users. The good: Karma is restoring 5 Mbps download and upload speeds on its $50 unlimited data plan, after slowing things down a few weeks ago to deal with data hogs. The bad: You'll only get those speeds for 15 GB worth of data -- afterwards you'll be throttled down to between 64 Kbps and 128 Kbps.

In a blog post today, the company notes those slower speeds should be good enough for basic email and data access (if you're very patient). And to sweeten the deal a bit, Karma will also give you $1 worth of credit for every gigabyte you don't use. That's on top of the $1 you earn every time another user connects to your hotspot.

Karma, basically, is experiencing the same growth pains as every company who's offered unlimited mobile data. There will always be hardcore users who push the concept of endless data to the extreme (Karma says some consumed over 1 terabyte of data a month) to the detriment of others. Inevitably, that either leads to throttling or the death of unlimited offerings altogether. T-Mobile now "deprioritizes" data for heavy unlimited users after 21GB, and Sprint (whose network Karma uses) now throttles people after 23 GB.

Interview with Karma CEO Steven Van Wel

"Some of you asked why we don't simply kick off the bad guys," Karma CEO Steven van Wel wrote. "Frankly, we don't think there are any bad guys. We offered an all-you-can-surf option, and people took us up on it. That's on us."

Sure, unlimited data plans with throttling aren't technically unlimited, but it's a sad fact of reality with America's mobile landscape. Perhaps as cellular networks get more robust (and carriers seriously rethink how they charge users), things will change. But for now, unlimited plans mainly exist so you don't have to worry about getting overcharged once you hit a bandwidth cap.

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