Through Price Hikes And Annoyance, AT&T Still Waging War On Unlimited Data Users

from the competition-means-higher-prices! dept

Fri, Jan 20th 2017 6:30am — Karl Bode

Back in 2011 AT&T and Verizon killed off their unlimited wireless data plans, instead replacing them with usage caps and steep (up to $15 per gigabyte) over fees. And while these companies grandfathered the existing unlimited data users at the time, they've spent the lion's share of the last six years waging a not-so-subtle war on these users in an attempt to get them to switch to metered plans. This ranged from AT&T's decision to block Facetime completely for users on unlimited plans, to covertly throttling these users only after a few gigabytes of usage, then lying about it. Repeatedly.

Of course AT&T has also used vanilla rate hikes on these unlimited data plans to drive users to metered options.

In late 2015, AT&T announced a price hike for its grandfathered unlimited data users by $5 per month. Last week, AT&T confirmed it had tacked on yet another $5 increase. AT&T informed these users that they are still free to keep their unlimited data plan, but AT&T really hopes that you don't:

"If you have a legacy unlimited data plan, you can keep it; however, beginning in March 2017, it will increase by $5 per month," AT&T said. The unlimited data price had been $30 a month for seven years, until AT&T raised it to $35 in February 2016. The price increase this year will bring it up to $40. That amount is just for data: Including voice and texting, the smartphone plans cost around $90 a month."

Reports have indicated this attempt by Verizon and AT&T to annoy, cajole, and hammer grandfathered unlimited data users so they leave these plans has been hugely effective. Both companies have desperately tried to convince the public that they don't really want unlimited data anyway, with Verizon going so far last year as to hire an expert to pen a blog post claiming that the consumer desire for unlimited data was just a "gut feeling," and that it was simply technically impossible to offer simpler, easier unlimited data plans.

Even with limited spectrum, the rise of small cells, WiFi offloading, and more robust networks and intelligent network management tools means unlimited data certainly is technically possible. T-Mobile (even though its plans may technically violate net neutrality by throttling all video by default) has thrived thanks to its unlimited data plans. In fact, they've made consumer annoyance at AT&T and Verizon pricing the cornerstone of many of their media campaigns:

How people feel when they open their @Verizon & @ATT bill. Get rid of your #feeface people!!!! pic.twitter.com/viS8TXOkAG
— John Legere (@JohnLegere) January 17, 2017

Unsurprisingly, both AT&T and Verizon have been losing customers hand over foot to T-Mobile. It's telling (both about these companies and the overall quality of real competition in the space) that their reaction to this competitive threat is to raise rates, whether that's AT&T's price hikes for unlimited data, or Verizon's recent decision to jack up a number of service fees. Yes, AT&T and Verizon could offer unlimited data. It's just far more profitable to have your customers so terrified of going over their monthly allotments, that they sign up for fat, pricey data plans they probably don't need in the first place.

Update: Like clockwork, AT&T has followed Verizon and will also be bumping its activation and device upgrade fee as well. Competition!

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Filed Under: broadband, grandfathered, price hikes, unlimited
Companies: at&t

17 Comments

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That One Guy (profile), 20 Jan 2017 @ 5:12am

"That thing you want? Yeah, you actually don't. Stop it already!"
"People don't need unlimited plans. People don't want unlimited plans. Do you hear us customers?! Drop the unlimited plans you have and move to capped ones already! If you don't we're just going to keep raising the price and making the service even worse, so switch already!"
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Anonymous Coward, 20 Jan 2017 @ 6:42am

Free-Market to the rescue!!!!
No wait... regulation put a stop to that one!
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Steve Swafford (profile), 20 Jan 2017 @ 7:01am

Got my email
Yep, got my $5 increase email the other day. I wasn't surprised at all.
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Michael, 20 Jan 2017 @ 7:07am

Re: Got my email
Good thing you had unlimited data or that email might have put you over your cap.
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Anonymous Coward, 20 Jan 2017 @ 7:16am

Re: Free-Market to the rescue!!!!
Privatized wireless spectrum put a stop to it.
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Anonymous Coward, 20 Jan 2017 @ 8:54am

Re: Re: Free-Market to the rescue!!!!
Brought to us by.... drum roll....

Regulation!

I am not 100% against regulation just that regulation should always be seen as bad and destructive. The point is which parts of the economy do we want to destroy? If we are destroying the Monopolistic Parts of the economy and the businesses that try to form Trust, then I am 100% pro-regulation. But that is NEVER asked for, instead everyone just calls for regulation without any controls. Which just gives us regulatory capture like we have right here, where every changing of the Guard just gives the current administration too much bludgeoning power over the citizens. And this is technically not legal under the constitution, but hell, no one gives a flying fuck about that anyways.

So carry on!
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Anonymous Coward, 20 Jan 2017 @ 8:57am

With real estate prices
It's hard for a hard working executive to buy a second or third volcano island on just 100ish dollars per month per person
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Anonymous Coward, 20 Jan 2017 @ 9:15am

Competition is alive and well
The companies are competing to see who will be first to annoy all their unwanted legacy users into abandoning those unlimited plans. First company to reach zero customers on an unlimited plan wins bragging rights. To do this, they need to make the customer experience as frustrating as possible, and they are competing fiercely about the best ways to antagonize their customers.

What works better: month-over-month rate hikes, or rarer but much steeper hikes? Below the line fees or a base change in service price? Maintaining the same level of bad service at a rapidly increasing price or a slower price increase coupled with declining quality of service? All these are important considerations when you want to drive your users off the plan as quickly as possible.
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Anonymous Coward, 20 Jan 2017 @ 9:18am

"gut feeling"

claiming that the consumer desire for unlimited data was just a "gut feeling"

In non-monopolistic businesses, aren't "gut feelings" what businesses generally target? I don't think I've ever seen a soft-drink commercial saying much else, and car companies like to tout engine power without giving any argument why one would need such power. Supermarkets have made an entire science of analyzing gut feelings and arranging products accordingly--and getting companies to pay to be in the "best" spots.
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Ninja (profile), 20 Jan 2017 @ 9:37am

Unlimited data in wireless would be so goddamn useful I can't even describe. I have 2 lines, one of them offers 1,1Gb and the other 1,5Gb. For my current habits, 1,5Gb is enough and I switch to wi-fi whenever possible but not because of the caps but rather because stability and speed. Still, this month I ate the entire 1,1Gb cap ans I'm above 70% of the other because I had to use it to move some files around in an emergency. So while I don't think I would change my online behavior that much (by my calculations I'd live well with 5-10Gb per month which is nothing in terms of costs to these companies) it would give me peace of mind to use when needed and as needed regardless of caps.

Of course, 3g watchdog developer (and other bw control apps) thanks all the carriers for the bs caps.
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Mononymous Tim (profile), 20 Jan 2017 @ 11:02am

'A'T&T my A$$
The A in AT&T hasn't stood for American in a long time.
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Ringo Bell, 20 Jan 2017 @ 11:12am

Can you hear me now?
AT&T has been ccontrary, sneaky, underhanded and disrespectful so many decades - unlike the early days of their existence.

As an old guy who previously worked on projects relatated to their divestiture (etc. in the 80's) ,along with significant personal experience, it is TIME TO HANG UP ON AT$T.
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DannyB (profile), 20 Jan 2017 @ 12:28pm

Unlimited Data Must Go!
The big problem with unlimited data is that it undermines the business plan of "Zero Rated" content. If you have unlimited data, or even simply enough data, then there no reason to have Zero Rated content.

Zero Rated content is a euphemism for a back room deal where a data provider (like Netflix) pays AT&T to be Zero Rated. (eg, for Netflix data not to count against your data cap -- a cap you wouldn't have with unlimited data)

Think of all that extra revenue from Zero Rated business model.

AT&T gets paid by both ends of the connection. Not just the end that they service. But the other end as well.
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Anonymous Coward, 20 Jan 2017 @ 12:42pm

Re: Re: Re: Free-Market to the rescue!!!!
Regulation is like many other things. It can be used for either good or evil.
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Anonymous Coward, 20 Jan 2017 @ 12:45pm

Re:
1.1 Gb is only 0.1375 GB. No wonder you went over.
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Anonymous Coward, 20 Jan 2017 @ 12:51pm

Forget AT&T and Verizon.
I'm going to do things for myself and setup my own cell tower.

Wait. What do you mean, "that's illegal"? No wonder we're screwed.
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dogwitch (profile), 20 Jan 2017 @ 2:47pm

the rint . turn out to be the smart one
it funny that for year t mobile was in 4th place. but the did massive investments and listen to their consumes. but the other did not. how time has change.
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