FreedomPop Launches Free Home Broadband Plan

FreedomPop today launched a very low cost home broadband plan for extremely low-intensity users, with 1GB monthly for free and 10GB for $10.

While this won't appeal to anyone who does multimedia streaming - such as most PCMag.com readers - it attacks an under-served customer base of "non-streaming" users, many of whom are still stuck on dialup, FreedomPop CEO Stephen Stokols said.

"While average [U.S. home broadband usage] is 24-28 gigs per month, the average is skewed heavily by the whales. The median is actually 5.8 gigs, which is basically your non-streaming user," Stokols said.

The 1GB of free Internet is basically a teaser; Stokols understands that's less than most people would use at home, although he said dialup users typically consume less than 1GB/month. Rather, FreedomPop aims to disrupt the cable and DSL business with its $10 plan.

"It's a mass-market plan that hits half the country that's using under the 5.8-gig median," Stokols said. "10 gigs for 10 bucks is a massively disruptive play."

He's right. Verizon's HomeFusion broadband sells 10GB for $60/month, while Clear's cheapest wireless home plan is 2GB for $20/month.

FreedomPop's base plan will be extendable by paying $5 for each additional GB beyond 10, or by signing up for promotional marketing offers. Stokols said that partner offers could let subscribers net up to 5GB at a time.

To take advantage of the deal, subscribers will need to buy a $89 home WiMAX modem, the Burst, which includes an 802.11n Wi-Fi router and a single Ethernet output port.

When HomeFusion launched, I brutalized it for having a ridiculously low data cap for the price compared to cable and DSL alternatives. My opinion of FreedomPop is kinder, though, because they're actually charging less money for less service. That's an equation which works.

New Plan, Old Network
How can FreedomPop charge so little? They're using a network that's going out of style. FreedomPop uses Clearwire's WiMAX network, which has been losing rather than gaining customers since Sprint (and now Virgin and Boost) switched away to Sprint's own LTE network. So Clearwire has a lot of spare WiMAX capacity that it has to use somehow, and it's better to get some money than no money.

Speeds on the WiMAX network aren't up to LTE snuff, but they're more than competitive with cheap DSL plans. In our Fastest Mobile Networks 2012 tests, we found the network had an average download speed of about 4Mbps. That's broadband.

According to Stokols, the WiMAX network will remain live until 2015, and FreedomPop will swap subscribers' modems out for LTE modems for free by then.

"We would basically have the same deal with LTE instead of WiMAX," Stokols said.

The WiMAX network's coverage is a bigger concern. Clearwire built out about a third of the country and then stopped because it ran out of money to do more. Even in the cities it covers, it can still be spotty. And as Clearwire builds its new LTE network, it's focused on the densest U.S. cities. So it'll be harder for far suburban and rural residents to take advantage of FreedomPop's deal.

"It's economics; the more rural you get, the more expensive the network will cost," Stokols said.

To sign up, go to www.home.freedompop.com.