The new 4G LTE-equipped Apple iPad you picked up late last week may be burning a hole in your wallet more than you think.  Across the country, consumers are reporting shock and surprise when they discover the new, faster mobile broadband-equipped tablet is capable of blowing through AT&T and Verizon Wireless’ monthly usage caps in a matter of hours.

The culprits: online video and giant-sized app downloads.

Online video on a usage-limited mobile broadband plan simply does not last long on Apple’s newest sensation.  A Wall Street Journal article found one new iPad owner discouraged after a two hour basketball game completely obliterated his 3GB usage allowance provided by AT&T.  With $10/GB overlimit fees just around the corner, AT&T is set to earn enormous data fees from customers who use their iPads to stream video.

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The Wall Street Journal reports the newest iPad has been out for less than a week and buyers are already burning through their monthly data allowances on usage capped 4G mobile plans.  (3 minutes)

USA Today tech columnist Edward Baig also blew through his allowance in less than one day:

Less than 24 hours after purchasing the Verizon Wireless version of the iPad + 4G — and choosing a $30, 2GB monthly data plan from Verizon — I was shocked by the notification on my iPad’s screen: “There is no data remaining on your current plan.”

My remaining options for the month included changing to a $50 5GB data plan or an $80 10GB plan. (AT&T offers a 250MB plan for $14.99; 3GB for $30; and 5GB for $50.)

[…] In my case, I wasn’t watching video. What nailed me, I think, is that I was wirelessly downloading a number of the apps that I had already purchased for my older iPad onto the latest model. Those apps were made available through Apple’s iCloud.

To help avoid just this situation, the new iPad has a 50MB per app download limit on 4G. Anything over that, and you’re directed to Wi-Fi. (The over-the-air download limit on 3G-capable iPads was 20MB.) But that’s a per-app limit, and all those smaller-sized apps I was moving to the new iPad collectively added up.

Storing anything on Apple’s iCloud service or other backup storage sites like Dropbox can prove costly when relying on 4G service from AT&T and Verizon.  That’s on top of Apple’s premium price for 4G-equipped iPads, which start at $629 (comparable Wi-Fi only models are priced at $499 and above).  As a result, consumers are shutting off the wireless mobile feature they paid $130 extra to receive.

“All the advantages of the iPad device are completely neutralized by [AT&T’s] two gigabyte data limit,” Steve Wells told the Journal.

Some customers are upgrading their mobile data plans to 5GB for $50 a month, offered by both AT&T and Verizon.  Others are learning to stick to Wi-Fi.  According to a study conducted by the consulting firm Chetan Sharma, nearly 90% of tablets bought in the United States are Wi-Fi only models.  The added cost for mobile-equipped tablets and the expensive data plans that accompany them are largely responsible.

Consumer Advice:

1. You can still leverage 4G mobile broadband speeds on a cheaper Wi-Fi-only equipped iPad if your smartphone supports the “mobile hotspot” feature. When activated, your phone becomes a Wi-Fi hotspot your iPad can connect to for wireless data. If you have an unlimited mobile hotspot plan from Verizon Wireless (now difficult to obtain unless you are grandfathered on an unlimited data plan), you are not subject to Verizon’s usage limits for mobile devices.
2. Rely as much as possible on Wi-Fi, especially for file downloads or streamed content. Since the iPad can seamlessly switch between Wi-Fi and expensive mobile data service, protect yourself by shutting off Cellular Data within the settings menu when you don’t absolutely need to use it.
3. Turn off LTE service when not needed. 4G consumes battery life faster and its speeds encourage the kind of increased usage that can exhaust your allowance.
4. Monitor how much data you’ve used from the settings menu. Web browsing and e-mail will not consume a lot.  Online video and giant app downloads will.

[Thanks to our regular readers Scott and Earl for sending in several stories reporting on this.]

Apple iPad in the News:

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Joe Brown, editor-in-chief at Gizmodo.com, talks about Apple Inc.’s new iPad, the outlook for Amazon.com Inc.’s Kindle Fire and the tablet market. Brown speaks with Jon Erlichman on Bloomberg Television’s “Bloomberg West.” (6 minutes)

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Shelly Palmer talks about the record-breaking sales numbers of the new Apple iPad. He discusses what is great and not so great about the new tablet on New York’s WNYW-TV.  (4 minutes)

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Paul Reynolds, electronics editor for Consumer Reports, talks about the magazine’s temperature test of Apple Inc.’s new iPad. The newest iPad runs “significantly hotter” than the earlier model when conducting processor-intensive tasks such as playing graphics-heavy games, Consumer Reports said on its website.  (9 minutes)

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It’s the hottest item in the tech world – literally. WFXT in Boston also takes a look at how other tablet manufacturers are doing in competition with Apple.  (4 minutes)

The days of free Internet access are back… sort of.

United Online, Inc. announced Monday that it will offer free wireless Internet access through its NetZero service, provided as a “loss leader” that depends on users upgrading to paid access to cover the service’s costs.

NetZero became familiar to most Americans in the 1990s when the company handed limited dial-up Internet access, paid for through online advertising that subscribers endured in return for getting the service for free.  But broadband costs considerably more, so as the transition away from dial-up turned into a stampede, NetZero faded into memories about as much as AOL signup floppy disks and CD’s.

But now the company is back pitching free access to “4G wireless Internet” with no strings attached, contract commitments, or overage fees.  But that does not tell the full story.

While there is no contract commitment, NetZero requires an upfront investment in wireless hardware — $50 for a USB antenna stick suitable for a laptop or $100 for a “mobile hotspot” that can deliver a Wi-Fi connection to other nearby devices.  The devices are for sale on NetZero’s website.

The “free wireless” offer is probably better described as dim sum — it comes with a 200MB monthly usage limit, which makes it suitable for basic web browsing and e-mail only.  Once your limit is reached, the service is cut off for the remainder of the month, unless you agree to one of several paid usage plans that range from $9.95 for 500MB to $49.95 for 4GB, billed monthly.

After 12 months, NetZero’s free ride is over unless you agree to continue with a paid usage plan.  It ends even sooner if you choose to upgrade to a paid plan anytime during the first year.  Once you do, you lose the option of switching back to the free plan.

Whether paid or not, NetZero users ride on Clear’s troubled 4G WiMAX network, which Sprint — Clear’s largest customer — is planning to eventually abandon for more advanced LTE.  The long term future of Clear, also known as Clearwire, is also up in the air.  The company has ceased investing in its WiMAX network and is making preparations of its own to switch to LTE 4G technology — incompatible with the NetZero hardware you will spend $50-100 to acquire.

Clear’s network has also received considerable criticism for its speed and performance.  Because it operates on much higher frequencies, Clear’s wireless signal has problems penetrating indoors, and has even more trouble where energy efficient window coatings are used, especially in the south.

While NetZero does, in fact, deliver the service for free, the upfront investment and potential service headaches limit its usefulness.  Light users may find free Wi-Fi, increasingly common in a number of businesses, more convenient, affordable, and faster than the NetZero alternative.

A British advertising firm is paying homeless people to act as mobile hotspots for the 4G-challenged in a controversial pilot project that has left some wondering whether it is appropriate to use the disadvantaged as walking wireless access points.

The project took off at this week’s SxSW Interactive conference in Austin, Tex.  Anyone within 20 feet of a roving homeless person outfitted with a transmitting device can make a wireless connection with a 4G network.

BBH New York says it just wants to fill the need for better Internet connectivity at the convention center site.

“Our hope is to create a modern version of this successful model, offering homeless individuals an opportunity to sell a digital service instead of a material commodity,” BBH New York says. “SxSW Interactive attendees can pay what they like to access 4G networks carried by our homeless collaborators.”

BBH has 13 homeless volunteers walking around the convention center announcing they are available to facilitate immediate 4G access for data-hungry attendees.

“Hotspots, Hotspots! If you need to get online, I am your guy,” yelled one homeless volunteer to hundreds of people passing by.

Those who take them up on their offer can make donations for the access, which volunteers get to keep.

The company admits it has received some criticism from those who think the program exploits the homeless, but the company had no shortage of volunteers willing to participate.

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KXAN in Austin explores the “Homeless Mobile Hotspot” project that has a lot of people talking at this year’s South by Southwest Interactive conference.  (2 minutes)

Bright House Networks Thursday switched on a huge network of free Wi-Fi hotspots for its broadband customers across central Florida.  Concentrated on coastal beach communities in eastern Florida and in the cities of Orlando, Tampa, and St. Petersburg, the new Wi-Fi service can be found on beaches and parks, inside malls and shopping destinations, downtown business districts, and medical facilities across their Florida service area.

Bright House Networks Wi-Fi Coverage Map

Existing Bright House broadband customers can log in and use the service for free:

• Most wireless devices will display available networks. If the device doesn’t show networks, open the network options and select My BrightHouse or Bright House Networks.
• Open the Internet browser of your choice.
• When the WiFi HotZones page opens, click ‘log in’ under Bright House Road Runner Customer.
• Log in using Road Runner email and password or My Services credentials.
• Agree to the terms of use and connect to the WiFi network.

Non-customers can purchase access with a credit card in increments of as little as three hours.  Stop the Cap! readers in central Florida report speed test results of around 5/1Mbps from many of the Wi-Fi locations, which is much better than many other publicly available Wi-Fi networks.

Bright House says it has launched the Wi-Fi service to help customers hang on to their usage-limited mobile broadband allowances.

“We’re trying to save our customers money, time and energy,” Bright House spokesman Donald Forbes said.  “Plus, Wi-Fi is so much faster and such a better connection.”

Cable provider-delivered Wi-Fi is often used by the industry as a customer retention tool and goodwill gesture.  It typically uses the company’s pre-existing broadband infrastructure, which keeps costs low.

Bright House is soliciting customer feedback about possible new locations for future Wi-Fi hotspots.  The company plans to add at least 2,000 additional hotspots by the end of this year.

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Bright House produced this informational video introducing its Wi-Fi service.  (2 minutes)

No need to be herded into a Verizon Wireless usage-limited mobile data plan.

New to Verizon Wireless and unhappy being constrained with a usage-capped wireless data plan?  Thanks to a loophole, customers can buy their way into an unlimited access plan Verizon was supposed to discontinue last July.

Some background: Verizon Wireless spent 2011 enticing customers to upgrade to their new 4G LTE phones which use the company’s much faster mobile broadband network.  One of the benefits early adopters received was a free, ongoing trial of Verizon’s mobile hotspot feature, which turns your phone into a Wi-Fi device your other devices (and friends’ phones) can share.  When Verizon elected to discontinue its unlimited data plans in July, the free trial of the mobile hotspot feature went with it.  In its place, Verizon pitched 4G phone owners an unlimited mobile hotspot feature add-on for $30 a month (in addition to the price of your data plan.)

Those who travel often or who want a backup Internet service in case their home or business Internet connection goes down found this a reasonable deal, especially because it carries no data limits or speed throttling, and works on both Verizon’s 3G and 4G networks.

But it turns out this little-known add-on promotion also unlocks the door to an unlimited smartphone data plan Verizon intended to stop selling last summer.

As we explained earlier, just signing up for the unlimited use mobile hotspot plan involved jumping through a few hoops.  But with the help of a feature code, any Verizon representative should be able to look it up and add it to your account.

When they do, something interesting happens.  Verizon cancels any existing usage-limited plan and converts it into an unlimited use plan ($29.99) they stopped selling.  That leaves you with Verizon’s Mobile Hotspot feature for $30 a month and unlimited smartphone data for $29.99 a month.  But here is the exciting part: you can quickly cancel the $30 mobile hotspot feature and will remain grandfathered on Verizon’s unlimited use smartphone data plan.

Slickdeals provides a helpful step-by-step guide, and it sometimes takes a few calls to reach a representative who can manage this successfully:

1. Dial *611 from your Verizon phone, or 1-800-922-0204 from any phone.
2. Wait for computer CSR to go through the main menu. You will need your Verizon phone # and account PIN or last 4 of SSN.
3. Hit option 4.
4. When it asks you what you would like to do today say “Add a feature.” You will be transferred to a live Verizon Customer Service representative.
5. If you have a 3G device (which includes all iPhones): Say you would like to add the $20 2GB 3G Mobile Hotspot FEATURE to your phone. When you add this MHS feature, you will be charged $20/month in addition to the $29.99 unlimited data plan.
   If you have a 4G device: Say you would like to add the $30 Unlimited 4G Mobile Hotspot FEATURE to your phone. According to http://stopthecap.com/2011/07/12/…r-account/ , they may be able to locate this feature via referencing feature code #76153. When you add this MHS feature, you will be charged $30/month in addition to the $29.99 unlimited data plan.
6. After one of the MHS features above are added to your account, you will now have the $29.99 unlimited data plan, which can be verified via the My Verizon app on your device or at http://www.verizonwireless.com/myverizon
7. {OPTIONAL – if you don’t want the Mobile Hotspot feature} Log into My Verizon and remove the Mobile Hotspot FEATURE from your account. It is recommended to wait at least a day to remove the feature. The $29.99 unlimited data plan should remain on your account.
8. If they say they can’t add that feature to your plan, or that you must bundle your data + mobile hotspot service together as a single data plan, tell them thank you, hang up, and repeat the steps above.

Updated 2:45pm EST:  Our regular reader Duffin reports this loophole may be in the process of being closed.  See this article from The Consumerist for further details.