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Understanding personal hotspots

With the recent power outages and disruptions to home networks caused by Hurricane Sandy, thousands of North East-based cellular subscribers turned to their smartphones and iPads to provide Internet access for their laptops and other devices. This was just the latest example of how personal hotspots are transforming the way we connect and making us more mobile than ever.

But not everyone is comfortable with how hotspots work and what impact, if any, they might have on data plans and monthly budgets. If you are still wondering whether a personal hotspot is the right solution for you, here are some Q&As that might help you make up your mind.

What exactly is a personal hotspot?

Think of a personal hotspot as your own Wi-Fi base station that you carry around in your pocket. Personal hotspots can be in the form of stand-alone devices (Mi-Fi units, Jetpacks, etc.) or they can be built into smartphones or cellular-connected tablets.

How do they work?

A personal hotspot works by tapping into a 3G or 4G cellular network and then wirelessly sharing a data connection with other nearby Wi-Fi-enabled devices. The efficiency of data transfer to and from those other devices will reflect the speed and strength of the wireless signal to the original hotspot device. That’s why hotspots have become more popular with the arrival of 4G networks: the improved network speeds have made hotspots more efficient and closer to the network speeds we are used to at home or at work.

What devices can connect to a personal hotspot?

Basically, any Wi-Fi-enabled device can hook up to a personal hotspot and use its data connection. That means laptops, e-readers, iPod touches, gaming consoles, even Wi-Fi-enabled TVs. However, most carriers place limits on the number of devices that can connect to a personal hotspot at any given time. More on the limitations imposed by the carriers later.

What about security issues?

Almost all personal hotspots come with WEP or WPA encryption and a password is provided for your security. That means your hotspot is mostly safe from unauthorized users that happen to be nearby. However, keep in mind that most smartphone passwords tend to be the 10-digit phone number of the device or of the ‘0000000000’ variety and are therefore relatively easy to crack. If your hotspot gives you the opportunity to change the original password, then take it.

How do I know if I need a personal hotspot?

If you are constantly looking for a Starbucks or another public Wi-Fi service so you can log on and do some work, then it’s probably time you got a personal hotspot. Similarly, if you sit at airports wishing you could log on, or you spend a fortune connecting through the sketchy airport Wi-Fi, then now’s the time to take the leap.

What will a personal hotspot cost?

Here’s the really good news. Up until a short time ago, all the main carriers priced personal hotspots the same way they priced smartphones – a two-year data plan was required, involving a separate monthly fee of $20 or more. However, led by Verizon’s Share Everything plans, some of the carriers are now including the personal hotspot feature in the monthly cost of the main smartphone plan.

However, that doesn’t mean using a personal hotspot via a smartphone is free. Anytime you connect a device to a personal hotspot and send e-mail, surf the web or do anything else involving the Internet, you are transferring data and that will count against your monthly data plan. If you are going to make frequent use of your personal hotspot, make sure you factor it into your individual or family data plan.

Keep in mind that stand-alone MiFi and Jetpack devices are also available. The monthly contract terms will depend on the carrier that you choose. An increasing number of carriers and independent wireless operators are also offering daily or weekly hotspot rentals, which can be a great option, particularly if you are going abroad.

How reliable are personal hotspots?

If you are using a stand-alone personal hotspot, then performance is usually fairly reliable. If you have a 4G device and you can pick up a decent 4G signal, then data transfer speeds are what you would expect from a reliable public Wi-Fi network.

Smartphone and tablet-based hotspots are more complicated. As many North East users found during Hurricane Sandy and its aftermath, carriers have a tendency to “throttle” personal hotspots when cellular networks are busy during peak times and emergencies. That means your personal hotspot can quickly become a coldspot and slow down to a crawl. If your hotspot feature is part of a shared data plan, then it won’t cost you anything – if no data is transferred, it’s not eating into your data allowance – but it does mean that your personal hotspot can let you down just when you need it the most.

How do I turn my iPhone or Android phone into a hotspot?

Once you have changed your wireless plan to include personal hotspot capability, activating that hotspot is a breeze.

On the iPhone, go to Settings > General > Cellular and tap the Personal Hotspot feature. Once you have activated the feature, it will give you instructions on how to connect other devices, including the necessary password. The personal hotspot feature is available on the iPhone 3GS and later models.

For hotspot-enabled Android smartphones, the Mobile Hotspot feature is usually built-in and can be found under Apps. Once you tap the app icon and turn on the Mobile Hotspot, you will see instructions on finding the network on other devices, along with the password.

Do you still have personal hotspot questions? Use the comments section below.

Comment by Maria, posted 4/8/2014, 4:55 AM:

I have a hot spot gadget from At&t , my question is: my data is going real fast, can the hot spot be bad and eating to much of my data? We don't use internet for long period of time, but the data keeps going down fast!
Comment by Neil Jackson, posted 11/24/2012, 1:46 PM:

How far away from your personal hotspot can you possibly be before it won't work
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