Home - , , , - Karma Restores 5 Mbps Neverstop Data But Soft Caps it at 15 GB Per Month

Karma Restores 5 Mbps Neverstop Data But Soft Caps it at 15 GB Per Month

Karma Hotspot
When Sprint MVNO Karma Mobility launched their "Neverstop" plan on November 5th it sounded like the holy grail of mobile broadband, totally unlimited data for $50 a month. Sure there were some negatives like a proprietary hotspot that cost $150, not so great Sprint coverage and data that was throttled to 5 Mbps. But in many markets wired broadband is either non-existent, slower than 5 Mbps or more expensive than $50. Neverstop's promise of relatively fast data with no cap for $50/month was the best available broadband deal for many people.

Karma did give off  mixed messages about how unlimited the service really was, saying on one hand that "Neverstop isn’t meant to be a replacement for your home internet (yet)" and on the other "We are upfront about what this $50 a month gets you: no caps on the amount of data you use at 5Mbps". The two statements contradicted themselves pretty badly, if there are no caps and the speed is 5 Mbps, why not use it as a replacement for home internet?

Neverstop was apparently pretty popular and according to Karma, some Neverstop customers used lots of data, as much as a terabyte (1000 gigabytes) in a month. On January 7th, Karma started throttling Neverstop to 1.5 Mbps, saying that heavy use was "putting a strain on the service" (more like putting a strain on Karma's bottom line, me thinks). Karma said the throttle would vary from 1.5 to 3 Mbs, as an experiment to determine how to modify Neverstop so that it would be both useful and sustainable as a business. Karma also conducted a survey of Neverstop users asking them how they used the service and for suggestions for the Neverstop re-design.

The results of the throttling experiment and survey are in. Karma's CEO told The Verge that  59% of survey respondents said that they used Neverstop as a replacement for home internet. In a blog post today, Karma announced the following changes to Neverstop:

  • Speed has been restored to 5 Mbps.
  • A 15 GB soft cap is being imposed. Data is still unlimited but after the first 15 GB in a month speeds will be reduced to a glacial 64 to 128 Kbps.
  • Customers who use less than 15 GB will get a $1 credit for each unused GB.
  • The 15 GB data counter starts today.
  • Any customer who isn't happy with the changes can return their hotspot for a full refund.
I'm disappointed, but not surprised that Karma wasn't able to live up to its promise of unlimited 5 Mbps data for $50/month. Karma is a middleman buying wholesale data from Sprint, which probably charges Karma at least $2 per GB. There's no way that Karma could be making money on any customer who uses more than 25 GB in a month. Karma had to know this when they launched Neverstop. I don't understand why launched Neverstop without a cap. 15 GB of 5 Mbps data for $50 is actually a pretty good deal in today's mobile broadband market. But the returned hotspots, lost customers and negative publicity have got to be costing Karma far more than the publicity, hotspot sales and new customers they gained from the Neverstop launch. Judging by the almost universally negative comments on todays blog post, the company also earned itself a huge dose of bad karma with the Neverstop flip-flop.

Related posts:
Karma Explains Throttled Data Speed on Neverstop Plans
Karma Launches $50/Month Neverstop Unlimited Mobile Broadband Plan
Here's Why We Don't Have Unlimited Mobile Broadband

Source Karma Blog


Comment Page :
  1. Now, is Karma completely OK with it being used as a home broadband replacement?

    And I don't know... even though Karma could have handled it a lot better, I've seen other companies behave a LOT worse than Karma in similar situations. Their regrouping seems surprisingly nimble compared to a lot of MVNOs found on the list on the right of this page who do boneheaded things and then ride their bad decisions to oblivion.

    1. They were "ok" with it before, they just suggested that the speed wouldn't be suitable for it.

      It doesn't excuse them for changing the throttle in the middle of the month without warning. It also doesn't consider anyone who may have made other purchases based the original terms of this service and who may have assumed that the company had done its due diligence about the feasibility of its offering.

  2. I have Uverse internet (no home phone or uverse tv) which seems to be a gathering trend with many customers cutting the tv cord. But as one unusually honest Uverse rep said "they need to make up lost tv revenue, and knowing that internet service is becoming a household staple, they're gonna stick you with higher monthly bills or added fees". I would love to see more companies like Karma offer affordable home internet service so that when Uverse/Comcast decide to stick it to their internet users, we'll have other options to choose from and just walk away from the big 2 monopoly...

    1. Whats the Big 2 monopoly? ATT and Verizon?

      Being more successful does not automatically mean "monopoly".

      Seems to be one of the words thrown around a lot without regard to meaning.

    2. Broadband internet clearly fits the definition of a "natural monopoly" and indeed, most of America have only 1 option for broadband internet, as defined by the FCC. Comcast being "successful" is entirely because of a lack of options.

    3. I've had cable since 1968. I've never had Comcast, however. Comcast is some distant thing I hear about in national news, like "Jack in the Box"... some big regional thing somewhere far off. Words mean things, and one option of many does not meet the definition of "monopoly".

    4. Broadband internet is not and never will be a monopoly, natural or not.
      Oligopoly, maybe.
      You are also wrong about options.
      Most Americans have a choice of 3 or more mobile networks, let alone MVNOs.
      People have options, not trees, bushes, rivers and cows. They don't buy anything.

  3. If Karma had just started with this plan, everyone would think it's great. Is there anything else to beat $3.33 per GB? Freedompop's best rate is $7.50/GB.

  4. I was one of the fools that jumped onto Karma Neverstop (and accidentally figured out how to hook it into my home network for primary internet access). Good thing they're offering full refunds. Begrudgingly, back to Comcast and price gouging.

  5. Glad to hear about buyback. I'll keep a lookout for good deals on "refurb" Karma GO hotspots.
    I need one for Refuel plan and the buyback should help lower the hotspot price.

  6. Glad they're offering refunds. Karma turned out to be a dud. $50 for up to 15 GB of 5 Mbps internet is a lukewarm deal at best.

  7. 15GB isn't enough Wifi for one person, let alone a family.

    They've basically locked themselves into playing the same light-data game as every other MVNO.

    Instead of offering a good service that people want to subscribe to in the long term, they're targeting the same light users as everyone else while hoping the bad PR and throttled speeds don't cost them more than they've gained by capping.

    Why even bother?

    1. Your math is not too good. Dennis gave you the key. $2/GB.
      How much would you charge if you wanted to stay in business providing "unlimited" high-speed mobile data?

    2. Honestly, I wouldn't be in the business of providing unlimited data plans in the first place.

      Unlimited data is primarily a byproduct of bandwidth rationing, which means it's only feasible at the cartel level because only the telecom cartels don't have to deal with their own artificial scarcity scams.

      There's literally no way for an MVNO to make it work so long as the FCC continues allowing carriers to scam everyone by charging for an infinite commodity.

      Really, Karma should've just stuck to undercutting competitors as a data reseller.

      They also should've known better than to advertise unlimited data if they weren't paying Sprint per chunk of 5mbps bandwidth.

      Then again, if an MVNO could actually negotiate a bandwidth rationing agreement with an MNO, the only issue would be whether or not the cost allowed for wide enough margins to profit while still keeping rates competitive with wired alternatives.

      However, that too would be entirely dependent on the whims of the telecom cartels.

    3. "15GB isn't enough Wifi for one person, let alone a family".

      I might be called a data-hog by some. I stream music a lot, do a lot of web and photos on my phone, and download a lot of files. I usually use 10GB a month.

      So, unless you are streaming video (and yes that is a HUGE if, and might be a showstopper!), I'd say from experience that a person could get by on 15gb a month.

      That would be my experience, plus 5GB of video on top for good measure.

      "First World Problems", though !!

  8. If Clear was able to offer unlimited data, granted at ~2.5Mbps, on Sprint's WiMax network, it doesn't make sense that Karma can't do at least the same on Sprint's LTE network.

    1. Clear was able to offer unlimited data because they owned the network. They didn't have to pay an upstream provider for the data their customers used.

  9. " The two statements contradicted themselves pretty badly, if there are no caps and the speed is 5 Mbps, why not use it as a replacement for home internet? "

    It was a guideline not a restriction. In their opionion, 5mbps wasn't ideal for a home solution but there was no prohibition of it.

  10. This could have worked. They could set the throttled speed to 256kbps. Customers that have their Netflix Playback Resolution is set to LOW, should not have a problem (further testing required). Karma could create a Streaming plan at 256kbps with unlimited data and a faster General plan with data cap. Avoid HD.

  11. Enough of the "bad" Karma and old dogma.
    Let's have an article on FreedomPop's new GSM Global Hotspot and free service:

    1. SIM cards all sold out the first day this story hit the web. Silly FreedomPop.

  12. I had Karma for exactly a month. After that, I decided to get cable internet. It was ok provided I didn't have a lot of devices to hook up to it. I didn't do any streaming of video our music. It was however my only internet access during that period of time. The only issue I had with them was it didn't have a support phone number so you would have to wait for emails from support. Sometimes answers never came.
    I am not surprised they could not sustain the service. If you advertise all you can surf data, people are going to fully utilize it that way.
    I do agree with done of you that some research should have been done before putting this plan out there specially since Clear had just gone out of business and many people were looking for other alternatives.
    I don't think we will see another option like Clear in the near future, unfortunately.

  13. Karma has revamped their plans again and appears to have dropped Neverstop.

    Refuel (pay-go) - $14/GB no expiry
    Pulse 5 - $40 5GB/mo
    Pulse 10 - $75 10GB/mo
    Pulse 20 - $140 20GB/mo

    Extra data on Pulse is $15/GB with unused balance refunded.

    They are no longer competitive with the likes of Boost and T-Mobile hotspot plans unless one earns a lot of guest credits.

  14. They are stopping the service. Too bad; I wish they could have figured out a way to make it work:


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