Can I Keep Unlimited Data with iPhone Personal Hotspot?

tethering iPad and iPhone
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An unlimited data plan would be the perfect match for the iPhone's Personal Hotspot feature, wouldn't it? Well, it is — with a few limitations.

Unlimited Data Plans and Personal Hotspot

Most major phone companies these days include tethering — the generic name for the feature that Apple calls Personal Hotspot, which lets you share your iPhone's cellular data connection with other devices to get them online — in their monthly plans for no extra charge. Even better, most carriers offer at least some plans that include unlimited monthly data. So, yes, you can use Personal Hotspot with an unlimited data plan.

Sounds too good to be true, right? Like there must be a catch? Well, there is.

Those unlimited data plans are unlimited in that you can use as much data as you want, but they aren't unlimited at the highest-possible speed. These unlimited data plans have usage caps in them which, if you exceed, will cause your data speeds — including your tethering speeds — to be reduced for the rest of your current billing period.

For example, let's say the usage cap on your plan is 20GB of wireless data per month. As long as you use less data than that, you'll get the fastest possible speeds. However, as soon as you use more than 20GB of data in a month, your speed will be reduced. This is how phone companies charge all users roughly the same amount but ensure that some don't use way more data than others.

Compare the monthly plan offerings from the major phone companies in the U.S. by checking out Which Company Has the Best Monthly iPhone Plans?

The History of Unlimited Data and Tethering

The relationship between Personal Hotspot and unlimited data hasn't always been so straightforward.

When the iPhone debuted, AT&T — at the time, the only phone company that offered the iPhone in the United States — provided unlimited data plans to iPhone users. Those plans didn't include tethering, though.

When tethering debuted on the iPhone, AT&T allowed existing users to keep their unlimited data plans, as long as they didn't make any changes to those plans. New users no longer had the option to purchase unlimited plans.

Over time, AT&T and other phone companies made it harder and harder to keep both an unlimited data plan and tethering. In those days, users paid for their data use by the gigabyte, so an unlimited plan wouldn't generate as much revenue for the phone companies.

Since then, phone companies have mostly switched to the unlimited data with usage caps system described in the last section. Since they no longer make money based on how much data a customer uses, tethering has come back to unlimited data plans.