Wednesday, June 09, 2010

Calling B$ on the new AT&T data plans to sting #iphone upgraders

This week AT&T announced a new pricing structure for their data plans as a step towards fixing their network "challenges."

Let's take a look at these changes.

The original "Unlimited" data plan for iPhones was $20 for the first generation iPhone. This rose to $30 per month for the 3G and 3GS phones. One thing to remember is that "Unlimited" is unlimited in the sense of You can use up to 5GB of data each month. When you look at most US wireless carriers their plans are capped at 5GB.

As of June 7th, when Steve Jobs is widely expected to announce a new generation iPhone at the Apple World Wide Developers Conference, AT&T ushers in a new set of pricing plans.

iPhone users will have two plans to choose from:
  • DataPlus
  • DataPro


The DataPlus plan offers 200MB of data/month for $15. If you go over this limit each additional 200MB costs a further $15.


The DataPro plan gives you 2GB of data per month for $25. If you burst through this cap each additional 1GB costs a further $10.


We know tethering is coming in iPhone OS4. AT&T will charge you $20 to add tethering to your account. They are not giving you any extra data for this. They are just charging you $20 extra to use what you have already bought.

Will this really fix the AT&T network?

AT&T is justifying the changes saying that 65% of their customers use less than 200MB per month and 98% use less than 2GB per month. If this is the case then the price change will do nothing to alleviate the network congestion and is all about extracting extra revenue for customers through overage charges. Also note that unlike the carryover of voice minutes that AT&T offers, there is no carry over if you under use your data plan but you will get charged if you go even one byte over your monthly capacity.

This is perfectly timed by AT&T to extract extra revenue. The new iPhone is going to offer new features like Video chat that will consume extra bandwidth. Yet the AT&T reps will be able to show you your historical use of data, if you are upgrading and convince you that you currently come within one of their plans. But watch out for the surprise when you start experimenting with all those wizz bang new features on your brand spanking new iPhone!

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