“AT&T, the second-largest U.S. wireless company, is battling network congestion as it tries to manage soaring demand for data-hungry devices such as Apple Inc.’s iPhone. The carrier said this week it will cut wireless data-plan prices for most users and stop offering unlimited data plans,” Miller and Kharif report. “Though Dallas-based AT&T has the highest-speed data network, it has the most frequent dropped connections, according to a study by PC Magazine.”
“‘They’re trying to make us use the network less rather than invest in the network,’ Jeff Jarvis, who writes the BuzzMachine blog and has AT&T service for his iPhone, said in an interview,” Miller and Kharif report. “AT&T will provide a 200-megabyte plan for $15 a month and a 2-gigabyte package at $25 that compares with current offers of $30 for unlimited data use. Users who exceed the 2-gigabyte level can pay an extra $10 per month for an additional 1 gigabyte of data service, according to a statement. AT&T is also replacing its unlimited monthly plan for iPad tablet computers with a $25 plan offering 2 gigabytes of data.”
Miller and Kharif report, “Existing AT&T customers can keep their unlimited data plans, the company said. ‘For most consumers this is a good deal’ as their modest monthly data use would qualify them for a cheaper plan, Mike Gikas, senior editor at Consumer Reports in Yonkers, New York, said in an interview. ‘The concern is that given how they’ve changed the plan like this without warning, there’s no stopping them from doing it again if they find it’s not as profitable for them.'”
“How AT&T’s business is affected by the pricing changes will depend in part on whether other wireless carriers follow its lead. Heavy-data users may defect to Verizon Wireless if that company keeps its current pricing, said Barclays Capital analyst James Ratcliffe,” Miller and Kharif report. “Verizon, the largest U.S. wireless carrier, declined to comment on whether it will scrap its advertised unlimited plan, which carries extra charges if customers use more than 5 gigabytes of data a month.”
Full article here.
[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]
Sadly, there’s no guarantee Verizon will be any better. But this does threaten to turn into enough of a problem that it will become a serious liability for Apple to remain exclusive with AT&T.
I’m not a huge fan of AT&T;, but give me a break. The unlimited data plan over cell networks just couldn’t last as a concept–not when data demand is so high, and is going to get higher as video comes around. AT&T;and all other carriers are a for-profit business–they are under little obligation to provide services to us for free or at cost. Having a tiered data plan makes total sense.
Having said that, charging extra for tethering, while providing no extra bandwidth, is complete bullshit. Makes zero sense, can’t possibly make AT&T;all that much money, and is only going to piss off consumers unnecessarily.
Also, they should have an unlimited plan for data as well. Charge $40/month or something, but give folks the option.
Ouch! Not unexpected, it is At&T;.
Innovation and customer service are’t their strong suit.
Hello there Sprint, will be nice seeing you with an iPhone and way better pricing than verizon. Would not shock me to see this happen. 2GB a month?? thats it? And you can now tether?? Wow, tether that to your laptop and watch yourself hit the limit in a matter of a few days. A couple weeks at the most for some.
Simply fascinating how the raging complainers are all now declaring that they will leave for Verizon! This really makes absolutely NO sense!! Let’s review (for those in the back row):
1. You have $30 per month unlimited plan.
2. AT&T announces that the new iPhone customers will no longer be able to get the unlimited plan;
3. You can hold on to your unlimited $30 plan indefinitely, even if you want to upgrade your iPhone to the newer model.
Once again, why are they switching to Verizon? How are they affected/reamed/raped/ripped off by AT&T here???
Stop complaining. You want tethering don’t ya’?
MM
This will drive more iPhone users (current and potential) to Verizon’s Droids unless VZ gets an iPhone real soon. Like announced this month.
And I am one of them, put me in for four VZ iPhones if they are announced soon, otherwise I’ll be going with another loser (probably a Sprint EVO or VZ Incredible). Better than nothing!
Best to stay with the $30 unlimited plan for a couple months until you see how the new video chat impacts your data usage.
@Chen the thief
How about youtube usage? im sure with emails, and youtube alone people would suck up a bunch of data.
people really need to look at their usage, the 2GB Datapro plan would probably meet most people’s needs with room to spare and save $5 a month. For the people that are already on unlimited, they keep that plan based on what I read, these changes would affect new users, not existing, seems like there is a big to-do over nothing.
Now every commercial from everyone else will start boasting about unlimited data connectivity / downloads / whatever… it will happen.
There are two things that make this ‘backlash’ so ironic:
1. Those who are complaining are those who already HAVE iPhone and are never going to be affected;
2. Those who WILL be affected (such as myself, who has yet to buy an iPhone) are thrilled that they can finally get an iPhone without being monthly raped by AT&T to the tune of $30. If I’m anything like 40% of US iPhone users, I’ll comfortably fit below 200MB, and will therefore spend $15 per month on data most of the time. My wife most certainly won’t ever go above that limit (web, e-mail and very rare, occasional YouTube; I’d be surprised if she hits 100MB in her best month).
As a member of a very large silent majority who is thrilled by the sudden affordability of an iPhone plan in the US, I would really like to ask all of you who already have your $30 plans (and can keep them as long as you wish) to please stop complaining in my name. I won’t even mind if you continue to rape AT&T’s network, milking your $30 for all it’s worth. Just don’t pretend to represent majority of current or future iPhone owners in the US.
i contacted ATT and they told me that since I ordered my ipad weeks ago, and its delayed in shipping, they will still honor the unlimited data plan for me even if i get it after the 7th.
Like I said in a previous post, UK users can get a 10GB/month iPad plan for $22. US data charges are outrageous.
=:~)
Huh! Verizon? They just sent my wife an $800 bill for my son going over their “Unlimited Data” plan….All the telecoms are sock cuckin’ swass ipes.!!!!!! Use ’em or lose ’em!!
:-o<====3 3-o-;
Dumb pipes require metered pricing.
Does your gas company offer an ‘Unlimited” plan? Your water company? How about your electric company?
It’s unrealistic to expect that ATT was going to be able to offer an “Unlimited” (which was limited, by the way) plan forever. OTOH, the benefits of a “dumb pipe” business model are many: companies will compete on (and invest in) the quality of their pipes (i.e. coverage, speed, etc.) and/or price, instead of trying to differentiate using stupid “services” such as “V-Cast”, etc.
Assuming that other carriers will soon carry Apple mobile products (which I believe is true), then this is a good thing. If you think ATT is too expensive, some company will come along with a cheaper alternative. If you think their coverage sucks, another company will come along with better coverage for your area.
But this competition wouldn’t be possible with an “unlimited” expectation in the market, because smaller companies wouldn’t be able to predict their growth, and wouldn’t take the plunge out of fear they wouldn’t have the capital to build-out their network to keep pace with demand.
This was an inevitable, and good development.
This isn’t specifically ABOUT tethering (although I’m sure that weighs in a little). This is about the upcoming features in the NEW iPhone. Mark my words, if the new iPhone actually does have a forward and rear facing camera, like the leaks show, then that means iChat on the iPhone.
At&T;is positioning themselves for the increased bandwidth demands from people wanting to use that video chat with the new device and other apps that might use it. Any other talk is strictly a smoke screen to justify the increases.
At least thats my best guess… Don’t be a lemming.
@ Chas
In the US, the Last Mile is sometimes 500 miles long. The UK is the size of Oregon.
Chas, my dear moron, the cost of placing cell tower coverage over the continental U.S. vs. the fscking tiny UK needs to be factored into your retarded math.
@ all the people yammering on about how most people don’t use more than 2GB anyway – what short-sighted thinking! This is going to change rapidly, or it’s going to severely cramp innovation on the Internet.
One of the major features of the iPhone experience has been that we can just access the Internet without worrying about our data usage. It’s ridiculous and highly disingenuous to pretend that AT&T’s changes are no big deal.
@hairbo
I agree that this was bound to happen. However, they could have done a few things differently
1. They could have kept the unlimited data plan – albeit at a higher price (maybe $35 or $40). Most people would have opted for one of the lower cost plans anyway.
2. If they had to charge for tethering, they could have thrown in some extra bandwidth. Or else they could have a free (or minimal cost) tethering option without any additional bandwidth.
3. They could have dumped their stupid policy of charging extra for texts. Texts are data and should be counted towards your data limit.
Had they done all of the above, the outrage over their plans would have been a lot less.
– HCE
The (true) statement, “The distance one can travel in outer space is unlimited.”, when read and interpreted by an ATT policy maker means, “The distance one can travel in outer space is 2 billion miles.”.
ATT needs a dictionary, badly.
It is worth mentioning again, since most complainers keep ignoring (or are ignorant of) the following fact:
98% of iPhone owners use less than 2GB per month (that is ninety-eight percent).
40% of iPhone owners use less than 200MB per month.
Therefore, only 2% of iPhone owners will benefit from keeping their $30 plan. The remaining overwhelming majority will save money by switching to a cheaper plan.
It will be interesting to see how many actually do switch. One thing is very clear, though; AT&T will obviously not be making more money from iPhone users, once people start switching to more appropriate plans for themselves. I’m still not quite sure what is it that they hope to achieve here. Right now, the most likely thing is that they might ‘encourage’ the future heavy users to curb their usage to avoid heavy overages. Since they’re offering existing users to keep their unlimited plans, they can continue to suck bandwidth as they please. So, to me, this clearly looks like the most consumer-friendly way to attract new consumers by offering much lower data rates, without imposing any practical limitations.
Don’t forget, Verizon’s “unlimited” data plan is anything but “unlimited”. If you suck down more than 5GB, you’ll be slapped with a monster overage charge there as well.
The article just said that VZ’s “unlimited” plan was actually 5 GB with additional charges for going over. How’s that unlimited again?
I’m guessing was done as a way to lock in users who’s contracts have expired. If you are currently on an unlimited data plan why would you ever leave?