Tethering vs. Hotspots: What’s Better for Your Business?

What is phone tethering?

Phone tethering is a telephony technology that allows anyone with a modern smartphone and data plan to share their internet connection with other laptops, tablets and devices. 

John Blinkiewicz, Vice President of Mobility Product Management at AT&T Business, explained that “tethering” is an overarching term that, in simple terms, refers to connecting one device to another via Wi-Fi, Bluetooth or a USB cable. 

“[Tethering] allows a business to share an internet connection from an employee’s phone to their laptop, tablet or other device through Wi-Fi, Bluetooth or a USB cable,” Blinkiewicz said. “This provides convenient access to the internet for the secondary device, with an optional plan add-on.”

Most modern smartphones support this technology, making it easy and efficient to set up a business Wi-Fi network via tethering. As a bonus, it’s safer than using public Wi-Fi, particularly when dealing with business communications. 

Pros and cons of tethering for businesses

Tethering is a popular option for many businesses, but like any tech solution, it comes with both advantages and disadvantages.

Tethering advantages

• Shared network speeds: Users can share their mobile connection with their own devices or those of nearby colleagues. 4G (LTE) and 5G speeds can be impressively fast in many parts of the U.S. and around the world, allowing users to work, download files, conduct video conference calls and more. 
• Easy setup: Built-in tethering features on modern smartphones can be set up in seconds. Typically, you’ll head to Settings > Connections and find the option to enable it.
• Affordability: Instead of purchasing separate data plans for individual laptops, tablets and other devices, they can all connect using a single plan. This helps keep expenses down. Additionally, there’s no need to invest in new equipment to start using the technology. “Tethering uses your existing smartphone, so there’s no need to carry or purchase additional devices like dedicated mobile hotspots,” Blinkiewicz said.
• Availability: If you have a data plan and a compatible smartphone, you can start tethering to other devices immediately, as long as you have a network signal.
• Security: Tethering can provide a safer alternative to public Wi-Fi, especially when handling sensitive business data. “USB tethering provides a direct, wired connection, which is typically more secure than public Wi-Fi networks,” Blinkiewicz noted. (Wireless methods like Wi-Fi or Bluetooth tethering can still be secure, but they rely on strong passwords and proper settings.)

Tethering disadvantages

• Battery drain: Tethering can significantly drain your phone’s battery, especially when multiple devices are connected, which may require you to recharge your phone more often. Tethering over USB is often the most battery-efficient option, according to a T-Mobile spokesperson, who added that tethering is typically limited to a single device or just a few.
• Data limits: Not everyone has a smartphone plan with unlimited data. If you don’t, tethering can quickly push you over your limit, especially if you’re streaming videos or downloading large files. Your provider may even restrict your internet access until the next billing cycle begins.
• Throttling risk: If the cell tower you’re connected to is extremely busy, your provider may slow down data transmission speeds, impairing your ability to perform data-intensive tasks.
• Security risks: While tethering is generally safer than public Wi-Fi — especially when using a USB connection — there are still risks if the connection isn’t properly secured. If you don’t require a password to join the network, others nearby may be able to access it, putting your data at risk.
• Performance dependencies: A T-Mobile spokesperson cautioned that internet performance during tethering depends on your smartphone’s hardware capabilities. Blinkiewicz agreed, adding that some smartphones may limit the number of devices that can connect via tethering. 
• Not ideal for business travel: Tethering may not be the best option for employees who frequently travel for business. “Tethering via cables can be cumbersome and difficult to implement, while tethering via a wireless option can quickly consume a phone’s battery,” Blinkiewicz explained.

What is a mobile hotspot?

A mobile hotspot is a portable device or smartphone feature that creates a Wi-Fi network. It connects to your service area’s cellular tower and provides Wi-Fi-enabled devices with reliable access to broadband internet speeds. 

Blinkiewicz explained that there are two primary types of hotspots:

• Smartphone-based mobile hotspots (e.g., smartphones that act as wireless routers)
• Dedicated mobile hotspot devices (e.g., Mi-Fi units)

“A hotspot refers to creating a wireless access point on a smartphone or a dedicated hotspot device, enabling multiple devices to connect to the internet simultaneously,” a T-Mobile spokesperson explained. “Hotspots broadcast a dedicated Wi-Fi network, allowing multiple devices to simultaneously access the internet.”

Unlike the tethered hotspots you can create through your smartphone, dedicated mobile hotspots provide high-speed LTE network coverage to as many as 15 devices. Because they’re designed specifically to connect multiple devices to the internet, they generally perform better than standard smartphones.

“Devices that connect to that Wi-Fi network share the hotspot device’s cellular internet access,” Blinkiewicz explained. 

All major wireless network providers, such as Verizon, AT&T and T-Mobile, offer mobile hotspot devices from multiple manufacturers, along with service plans that feature a range of speeds, data allowances, and pricing options. 

You can expect to spend anywhere from $75 for a mobile hotspot device to $650 for a high-spec 5G model, plus between $20 per month and $80 per month for the data plan. If you regularly need to provide broadband internet access to multiple devices or host virtual meetings away from your standard business internet connection, consider investing in a dedicated mobile hotspot device with a sufficient data plan. 

To better understand the difference between tethering and a mobile hotspot, a T-Mobile spokesperson explained it this way: “Tethering generally refers to one-to-one connectivity that directly bridges the cellular connection to another device,” whereas a mobile hotspot allows one device to share its connection with several others simultaneously.

Pros and cons of a mobile hotspot for businesses

A mobile hotspot is a popular option for businesses, but it also has its pros and cons.

Mobile hotspot advantages

• Better battery life: You can expect up to 24 hours of Wi-Fi on a single charge with a mobile hotspot hub. If you need to stay connected throughout the day while away from the office, a hotspot can make that possible. Keep in mind that battery life may decrease with heavy data use or multiple connected devices.
• Easy setup and usage: Mobile hotspots are simple to get up and running, whether you’re using a smartphone or a separate device. “Setting up a mobile hotspot is generally straightforward and can be done quickly via your smartphone or a dedicated hotspot device,” Blinkiewicz said.
• Good speed and connection quality: Mobile hotspots offer both 2.4 GHz and 5 GHz connectivity. This, combined with the larger antenna built into the hardware, provides a stronger signal, with speeds of up to 50 Mbps.
• Security: Mobile hotspot hubs provide advanced security features. Many include built-in auto-VPN capabilities or allow you to connect to your own VPN. You can also easily monitor who’s using the network and how much data they’re consuming, and update access credentials so only authorized users can log in.
• Broader connectivity: Mobile hotspots can support multiple devices simultaneously, making them ideal for teams, group settings or families.
• Great for team-based or mobile work: Mobile hotspots are well-suited for small business teams or group scenarios where several devices need to stay connected. A T-Mobile spokesperson noted that hotspots work especially well in pop-up offices, trade shows, temporary job sites and field teams — anywhere teams need portable, reliable internet access. In these dynamic environments, a hotspot can serve as a temporary stand-in for traditional internet service.

Mobile hotspot disadvantages

• Additional costs: If you’re using a dedicated mobile hotspot device, you’ll likely need to pay an upfront equipment cost and sign up for a separate data plan. Some providers may offer the device for free, depending on your monthly spending and the length of your service commitment. Even if you’re using your smartphone’s hotspot feature, your plan may include data limits or require an additional monthly fee.
• More to carry: When you use a dedicated mobile hotspot, you’ll need to bring the device and its charger with you on the go. This adds to what you need to pack and keep powered when you’re away from the office. (If you’re using your smartphone as a hotspot, this doesn’t apply — but you’ll need to manage battery life carefully.)
• Potentially complex configuration and management: Mobile hotspots are generally easy to use; however, managing connections and security settings can become more complex when multiple users or dedicated devices are involved. “Managing multiple connected devices and ensuring secure settings can require some technical knowledge, especially with dedicated hotspot devices,” Blinkiewicz noted.
• Data limits: As with phone tethering plans, your carrier may apply a limit to your mobile hotspot data usage. If you exceed that limit, your connection could be throttled or suspended until you top up your account. A T-Mobile spokesperson also noted that supporting multiple users can significantly increase data consumption.
• Security risks: Because mobile hotspots broadcast a strong Wi-Fi signal to multiple users simultaneously, there’s a greater potential for security issues if the network isn’t properly secured. “If the Wi-Fi network isn’t properly secured to prevent unauthorized access,” the T-Mobile spokesperson noted, “you could be vulnerable to larger security incidents.”

Is tethering or a mobile hotspot better for your business?

Tethering is right for you if …

• You need internet access only for brief periods, such as checking email or sending files.
• You want to use your own devices without carrying anything extra.
• You already have a generous data plan on your cell phone.
• You don’t want to spend money on additional equipment or a separate data plan.

A mobile hotspot is right for you if …

• You need consistent internet access on the go for prolonged online sessions.
• You need to connect multiple devices to the internet simultaneously.
• You’re concerned about security and want more control over your data and network.
• You’d prefer not to use your cell phone for ongoing business internet use.

Jeremy Bender and Jeff Hale contributed to this article.