AT&T No Longer Offering Unlimited Data Plan To New Customers
from the no-longer-to-infinity-and-beyond dept
As they had previously hinted, starting June 7th, AT&T's new smartphone customers will no longer be able to opt for the $30 unlimited data plan that was previously offered. Instead, two plans will be offered, both with monthly usage caps: $15 for 200MB or $25 for 2GB. Additionally, tethering is now available for an additional $20 a month. However, tethering is only available with one of the new capped plans. Those who already have the old $30 unlimited plan will be able to keep it... but won't be able to tether. So, existing power users have to decide between $30 a month for unlimited internet data without tethering, or $45 a month for 2GB of data with tethering -- of course, with tethering, data usage would likely go up... even as the amount of data you can use goes way down.AT&T's motive behind this switch (beyond the obvious of boosting profits) is to attempt to address the network capacity issues that it has been experiencing, of late. As anyone on AT&T can attest, performance of the AT&T data network is far from stellar. The adoption of smartphones like the iPhone have made the internet a truly useful part of the mobile experience, and as such, data use on the AT&T network has risen dramatically as a result. Clearly, AT&T was not able to properly plan to handle the increased demand on its network, and as a result, is claiming it needed to respond by throttling the usage. Of course, one might argue an alternative would be to invest more in capacity, but that gets in the way of that boosting profits thing.
Amusingly (but not surprisingly), AT&T is trying to play this whole thing up as a big benefit to consumers:
"Some customers, up until now, have been hesitant to sign up for a $30 monthly data plan" for unlimited access, says Ralph de la VegaFair enough, but just because some people have been hesitant to sign up for the unlimited data plan doesn't mean you should do away with it altogether.
That said, there are actually a few things that AT&T has done right with this announcement. It's surprising that they are actually offering a cheaper tier for limited data -- something that they had not offered before. Also, with the limited plans, they have introduced a system of alerts that will notify users when they are near their caps. And, existing users with unlimited plans can continue as long as they want, without the tethering option, of course.
Even so, throttling usage could put a damper on the explosive growth of smartphone usage that we have seen in the past few years. There is an added cognitive transaction cost whenever a limit exists, so, by introducing these limits, AT&T has effectively made the iPhone less appealing. Recently, when asked about AT&T's capacity issues, Steve Jobs said "things, when you start to fix them, get worse before they get better. That's what I'm told. And if you believe that, things should start getting a lot better soon." It sounds like Jobs knew what was coming.
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Filed Under: data plans, ipad, iphones, tethering, wireless
Companies: apple, at&t
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Verizon soon to follow, and hopefully no others
As an aside, it might then have been in Apple's best interest to not support Flash. You can run your customers into huge data bills quickly if they spend all day watching videos or playing flash games.
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Re: Verizon soon to follow, and hopefully no others
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Re: Re: Verizon soon to follow, and hopefully no others
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Re: Re: Re: Verizon soon to follow, and hopefully no others
I did just get this from Verizon Customer Service:
"Wow, it sure is nice of you to take the time to let us know that you like the unlimited data option. Thank you! My name is Nikkie, I am delighted to pass your message along to the appropriate department.
I have not heard any rumors or plans about removing the unlimited data, so I can tell you with confidence that you can keep your unlimited data plan as long as you like. We have no plans to change the data plans at this time, as we offer unlimited options, and certain phones can also choose a limited data plan if they want to, we feel that we have covered all the bases, and so far this is working very well for us.
thank you for giving me this opportunity to confirm our intention to keep the unlimited data plan for your phone. If you have any further questions or concerns, please reply to this email, and I will be delighted to assist you further. Thank you for choosing Verizon Wireless."
So hopefully they aren't going to follow the path that AT&T is setting.
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Re: Re: Re: Re: Verizon soon to follow, and hopefully no others
Hopefully Nikkie is right and Verizon has backed-off of considering this path. Best case scenario (as I see it):
1) at&t experiments with caps alone
2) caps are an obvious and spectacular failure
3) the entire industry accepts the consumer's desire for unfettered access and builds-out thier networks to support vastly greater bandwidth.
4) 5GB/month becomes the new light-bandwidth user.
I know...I'm dreaming on numbers 3 and 4, but 1 and 2 could maybe, perhaps happen.
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Re: Verizon soon to follow, and hopefully no others
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It is nice to see them reduce their ridiculous overage charges, but overall this just seems like a move in the wrong direction.
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Re:
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Re: Re:
Because they should have expected a 5000% increase in data use over two years, right?
Please tell me what business you are in, and explain how your business has invested in expensive infrastructure to ensure you have capacity for 50x of current sales volumes.
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Re:
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Re: Re:
You are stating a falsehood with: "...they have made no effort to keep up with the demands being placed on their network."
The effort is twofold: invest in the network, and switch to a pricing model that makes users, content sites, and developers be more conscious of how they use a limited resource.
Just as we pay for water based on usage with our home water meters.
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ATT network = crap
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Re: ATT network = crap
I went to the USA vs Turkey soccer game in Philadelphia on Saturday and I couldn't even get or send email or anything else other than make calls for the entire event.
I had full bars and tried switching down to edge with no different results.
I found it amusing that AT&T has multiple ads in the stadium for their service but I can't actually use it in the stadium do to all the phones there.
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Re: Re: ATT network = crap
CDMA gets around this issue using math and many people can use the same channel at the same time w/o causing issues. But it requires a clear signal and lots of CPU power to crunch the math. A clearer signal usually means more power to the tower.
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Re: Re: Re: ATT network = crap
However, 3G networks in the US are all CDMA based, technically W-CDMA. So you're wrong that GSM Time Division Multiple Access has anything to do with data pricing to modern smartphones.
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Re: Re: Re: Re: ATT network = crap
Guess I'm hoping for too much.
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Re:
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The answer to A+++ Customer Service in three words...
Prepare for more love if they're placed by hand and scratch-n'sniff.
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Not so lovin' it.
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WTF sort of scale is that?
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Re: WTF sort of scale is that?
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Re: Re: WTF sort of scale is that?
good observation. In fact, putting in the network that offers fast data, putting in a large footprint around the country, and subsidizing a smartphone are all somewhat fixed costs, and they play a big role in the cost of offering mobile data.
So the lower tier users should pay more per MB, and your rough calculation is a good way of looking at it.
What I don't get is why AT&T felt the need to stick it to customers with the $20 tethering charge. If we are paying for our tiers of service, it should not matter how we use our purchased throughput.
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Is the loss of tethering
http://blogs.computerworld.com/why_tethering_is_stupid_and_unnecessary
I avoid AT&T like the plague so it does not mean anything to me. Smart phones are making mobile use of laptops less important. Couple that with the ubiquitous nature of Wi-Fi hotspots and the tethering issue shrinks in importance. Just another public relations black eye for AT&T. One day another company will get the iPhone and this company's users will flee.
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Re: Is the loss of tethering
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This really isn't bad.
So with this new plan if I used 5gb - which rarely happens -
it would be 25 + 10 + 10 + 10 = 55.00 still less than the $60.00 plan and if I go over it's WAY cheaper.
So in the end - I don't think they are lying in their spin.
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Re: This really isn't bad.
So with this new plan if I used 5gb - which rarely happens -
it would be 25 + 10 + 10 + 10 = 55.00 still less than the $60.00 plan"
bad math or typo? Did you mean a dime for every 1GB
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Re: This really isn't bad.
25+*20*+10+10+10 = $75/month for the equivalent of a $60/5GB "air card" plan.
Sorry, but it's going to be more expensive.
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Re: This really isn't bad.
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Not quite the fix most were looking for...
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I'm not going to pay $70+ a month to get pestered.
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Re:
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Existing user
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Re: Existing user
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What they DIDN'T say
Shedding customers is certainly one way to address over-capacity problems.
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Re: What they DIDN'T say
signed, the other Derek.
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When I first read about the new pricing, I was angry
I checked my wife's iPhone usage (she loves her iPhone and uses it a lot) and found that her highest month was 55MB.
Yes, her highest month was 1/4 the limit of the new $15/mo plan.
We will start "saving" $15/mo beginning on June 7th.
I say "saving" because this means that our daughter will inherit Mom's iPhone when Mom buys her new iPhone4.
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Sprint has already done this
Sprint has never really supported tethering, and has in fact went out of their way to block many features in their phones.
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Re: Sprint has already done this
They do.offer unlimited data and i love it!
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Using statistics to say what you want...
I don't doubt that, but averaged over what time though? Contract life?
If I use 3GB one month, then .5GB the next, my 2 month average is less than 2GB but att will be more than happy to hit me with an overage charge that first month; of that 98%, what percentage would be hit with overage in at least one month of their contract? I'd bet a large percentage of that 98%.
I have no problem paying for what I use, but it needs to work both ways; if I use significantly less than 2GB in a month, why do I still have to pay $25? Why can't they do rollover data? Why can't my data plan be dynamic? e.g. if I use
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Re: Using statistics to say what you want...
Why can't my data plan be dynamic? e.g. if I use
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Re: Re: Using statistics to say what you want...
This non-punitive overage is a very important part of the new AT&T pricing, and one of the best parts of it from a consumer's perspective.
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Re: Re: Re: Using statistics to say what you want...
att just wants it both ways, they want a continuous revenue stream from the fixed $15/$25 charge but they also want usage charges. Again, if it truly is about unclogging the network and customer value, then charge me true usage, like electricity...2GB at $25 = ~1.2 cents per MB. But they'll never do that because the average iPhone user pulling down 500MB/month suddenly goes from paying $25/$30 to $6, and att can't have that.
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Re: Re: Re: Re: Using statistics to say what you want...
Two good questions.
#1: Tiers of service are a compromise between pay per byte metering, like our water meters, and flat rate pricing. As Masnick and Dennis from Techdirt point out, consumers hate "transaction costs" and having to think about whether they should spend a MB or not. Tiered service is designed to allow customers to select a segment they fit in, and pay one predictable price. You seem to prefer a true meter, that's not necessarily a better model, just different.
#2:You're right, it is a little crappy to get charged a full GB when you go over by a MB. But that's what the notification SMSs and web-based usage meters are for. To help people understand their consumption (if they choose to get into the details). Also, it's way better than the old cellular days when they would hit you with "overage charges" that were HIGHER than your base rate. It was the anti-volume -discount.
Bottom line is that this is an improvement. It's not perfect for the consumer, and of course AT&T is doing its best to extract as much money as possible. But at least pricing is moving in the right direction: one that respects economics, gives the customer more options, and allows the typical grandma to pay less than the typical iPhone junkie.
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I Agree
I agree completely with what you said specifically the above statement. As long as their notification system works as promised these plans are marginally better for those in the 200MB to 2GB range; way better for those less than 200MB. Also, as long as these caps rise with the times too, which we'll have to wait and see on that one.
My overall point is that while the plans may be better, they're still actuarial based, meant to maximize profit and minimize consumer backlash. And I think att is being a bit disingenuous in their motivations for these plans.
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From att's press release: "Currently, 98 percent of AT&T smartphone customers use less than 2 GB of data a month on average."
I don't doubt that, but averaged over what time though? Contract life?
If I use 3GB one month, then .5GB the next, my 2 month average is less than 2GB but att will be more than happy to hit me with an overage charge that first month; of that 98%, what percentage would be hit with overage in at least one month of their contract? I'd bet a large percentage of that 98%.
I have no problem paying for what I use, but it needs to work both ways; if I use significantly less than 2GB in a month, why do I still have to pay $25? Why can't they do rollover data? Why can't my data plan be dynamic? e.g. if I use less than 200MB I pay $15 otherwise I pay $25 for data greater than 200MB but less than 2GB? Or some other method? There's gotta be a better way to do usage billing, and there is but why won't carriers implement them?
The answer: they won't make as much money.
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Less investment in network year over year
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Re: Less investment in network year over year
Here's a source:
http://www.neowin.net/news/atampt-to-invest-up-to-19-billion-on-network-upgrades
Do you guys have a source for your repeating allegations that they are reducing investment? And does it even matter? What if they invested very high in the year after iPhone launch, but diminished it a bit in subsequent years. Isn't that OK?
Oh. And there's also that $6.64 Billion dollars that AT&T invested in more spectrum rights in the 700MHz auction in 2008.
http://text.dslreports.com/shownews/Verizon-Nabs-Most-Valuable-700Mhz-Spectrum-92824
Lis ten, there are lots of reasons to hate AT&T, or your carrier whoever it may be. But you schmoes who keep bitching that "they don't care" or "they don't invest" are just speaking blatant falsehoods.
Do they drop calls? Yes. Would we like faster data? Yes. Do they care about network expansion? Hell, yes.
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Re: Re: Less investment in network year over year
DoJ and DoD were nice because of their connections in the previous administration, but being able to influence the FCC is golden because they can now influence the FCC to free up public spectrum for their own use.
Yep. Thanks for the dissertation, Derek. I think I know who you work for now.
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Re: Re: Re: Less investment in network year over year
Not really much of a secret, given that I publish the list:
http://www.kertongroup.com/telecom-consulting-projects.html
...but AT&T has never hired me. You don't know what you think you know.
Also, you say, "Isn't it nice that AT&T can now influence the FCC?" What are you talking about? Telcos have influenced the FCC for a long time. Is your point relevant to this discussion?
Look, people wrote in comments that AT&T doesn't invest. I argued that these comments were dead wrong, and offered numbers and linked sources. Are you debating me on this, or just rambling like a fool?
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Brilliant!
They really are assholes.
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Wait... Does T-Mobile still have unlimited data? Hmmm. Maybe the Nazis were right...
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Re:
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Verizon iPhone may change things
All I know is that with a jailbroken iPhone I'll be keeping my unlimited data plan, tyvm. I might have my wife's iPhone switched to one of the capped plans though, if AT&T will let us split them like that. I'll have to review her data usage.
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Gremlins also tell me to tie my shoes.
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I think there will be at least a dozen.
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Re: That $10,000 Phone Bill
You used it regardless of what the Salesman told you. Live and learn right?
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tmobile data
plus with froyo on nexus ones, tethering is built into the os for stock users (non-rooted users).
I pay 70 bucks a month for unlimited everything on my family plan....take that at&t.
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$15 screwing
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This is a blatant rip-off!
1. At&t suggests that the cap is no big deal because almost everyone uses less than 2GB. So why then would they change the plan to charge less? Does that sound like the at&t that we all no and love? Nuh-uh. No way.
2. The cost of 2GB is less than the cost of the current unlimited plan, but when you add in the price at&t is going to charge for tethering - a feature that is common now - the total cost is more than the current unlimited plan and you still only get 2GB.
3. If you buy 400 minutes of voice from at&t, they don't charge extra if you use bluetooth to connect a headset. 400 minutes of voice is 400 minutes of voice. With this new data plan, at&t is going to charge you more to use your own usb cable or your own bluetooth connection to connect a device to your phone. EVEN THOUGH THE 2GB OF DATA THAT YOU'VE ALREADY PAID FOR IS STILL ALL YOU GET. If you use your 2GB to watch videos on your phone it cost $25. If you use THE SAME 2GB to watch exactly the same videos on your PC or iPad connected to your phone, at&t feels they need another $20 for that - FOR NO ADDED VALUE. That's complete and utter bullshit. at&t is within their rights to charge us for data and voice connections on the 'network' side of the phone. They have no right to charge us for capabilities on the 'personal' side of the phone that they have nothing to do with. THERE IS NO BLOODY WAY I WILL PAY EXTRA FOR TETHERING UNLESS IT COMES WITH MORE DATA, WHICH IN AT&T'S CASE, IT DOES NOT!
Heres' what I think is really happening:
- Most people use far less than 2GB of data today. At&t has been making a killing on their data plans, even without a cap.
- The combination of tethering and iPads changes everything. Video consumption and file transfer activity will go up a lot. At&t had to put a cap on consumption. This part is easy to understand, even reasonable.
- Instead of implementing a cap and explaining to people - customers - what was behind it, they're trying to be clever douche bags by applying a cap and raise prices at the same time. The cost for a lot less data plus a charge for tethering - that at&t is not involved in delivering - is 50% greater. If I want to watch a 2GB video on my iPhone, it costs me a $25 plan. If I choose to watch the exact same 2GB video on a tethered laptop or iPad, the cost is $45 - even though AT&T's network load and involvement is 100% the same. Now THAT'S the at&t that we all know and love.
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The logic defies me...
Personally, rather than limiting it (which has effectively killed my aspirations as a customer) I would think they would expand their network to fix the problem and not remain stagnant. Now, Verizon or even T-Mobile have a chance to take the #1 spot that AT&T currently enjoys.
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Re: Re: Re: Using statistics to say what you want...
DoJ and DoD were nice because of their connections in the previous administration, but being able to influence the FCC is golden, and you are the winner.
Yep. Thanks for the CTIA dissertation, Derek. I think I know who you work for.
It's also nice to see that AT&T is sitting on a fat pile of cash that came from squeezing employees' healthcare benefits over the past 4 years.
You're an amazing man, Derek. Ever think of getting into PR? Seems right up your alley. You don't know these people until they move into your house.
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Re: Re: Re: Re: Using statistics to say what you want...
I argued this as wrong and showed the evidence.
I invite you to argue back sometime, if you have something of value to bring. Do you understand that merely (incorrectly) saying I'm in AT&T's pocket isn't actually refuting any point I made?
(And where are those free research reports you promised a few weeks ago?)
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Very Upset!
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Perhaps as 4G rolls out it will alleviate some of the congestion and caps won't have to be made. I'm counting on femtocells to be a popular choice because they'll dump wireless data straight to wire and back.
Also, adding more towers is not a simple process. It's one that creates NIMBYism.
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NO UNLIMITED PLAN.. CLASSLESS!
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...
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Ok
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Re: Ok
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