AT&T Mobility CEO Ralph de la Vega recently stirred up a hornet's nest by explicitly suggesting that usage based pricing could soon kick in as a means to counter the high bandwidth consumption by smartphone users who have played a big role in congesting the AT&T network infrastructure.
So as existing users of iPhone, what does this mean to the readers of this blog? Primarily, it shall help or harm depending on your personal data consumption. As much as a usage based pricing would hurt the high data consumers, it is also likely to benefit those users who have used their unlimited data plans judiciously. Also, considering de la Vega's pointer that only a small 3% of the users consume close to 40% of the bandwidth, a usage based data pricing is unlikely to hurt a majority of the users.
Nevertheless, should AT&T play unfair, is there still a way out? Ideally, there is. For one, our existing iPhone contracts should not be affected by any newly announced metered pricing plans. Those users who have an iPhone 3GS have their contracts running at least till June 2011. That's a lot of time before you need to start worrying. Even otherwise, it is very likely that Apple would be signing on another carrier in this time period. With a rival carrier in place, not only does the customer stands to have more choice, but that should also drive AT&T to offer a more competitive pricing plan.
Unlike earlier times when AT&T was quick to disapprove of any iPhone apps that appeared to be a bandwidth hog, of late however, there has been no visible dissent with approval of iPhone apps like UStream and Fring. Has that got anything to do with AT&T deciding to get its data plans metered? Is Ma Bell planning to use these iPhone apps as a bait to get people consume more bandwidth and hence help the carrier make more money all the while complaining about the same? You might want to think so if you like reading between the lines.
However, assuming usage based pricing does indeed become the norm, an unfortunate eventuality will be the change in the market dynamics of the app economy. Unlike the present scenario, the realized cost of an iPhone app will not just be the price you see on the App Store, but this will also depend on the average bandwidth you stand to consume. At present, app developers have not stopped innovating because of bandwidth related constraints. However, should the sale of high bandwidth consuming apps be affected because of AT&T's new ambitions, it can prove disastrous and the app economy will no longer be what it is now.
What is your thought on this? What other ramifications do you see as a result of AT&T's move towards usage based pricing? Please tell us in the comments.
I believe a class action lawsuit needs to take place with respect to carriers using the words "unlimited use"
ok…first off, if they go this route, I will jump ship asap. They have fucked with me for too long and if not for the iPhone, I would have left a couple years back. Secondly…let's say they go through with this and, not that it would likely happen, everyone decides to pay per usage, but still uses the same amount of data…you're network is still under the exact same congestion and is falling apart as before. The only difference being…you have more money, we have less. We are still in the same fucking boat! Fix the god damn network you fucks!
Seems like this is all one big scam. They claim that we use so much data on our iPhones…how can this be? Not everyone is streaming video to the web or watching you tube videos. They claim the network is strained by a pretty constrained form of web browsing. We cannot download torrents/files/directly to the phone (werent we just barely allowed to download songs directly from iTunes to the iPhone?). The phone is not a computer. I can't play on xbox live via my iPhone. I cannot stream HD movies via netflix or iTunes (through to my appletv).
At the same time AT&T/comcast are pushing towards a metered use of regular cable/dsl based Internet. Meanwhile they push us towards using wifi at home on our iPhones? I have dsl through AT&T and my iPhone. I think $125 a month is quite enough for my small tube to the Internet.
Another thing, why don't they switch to metered phone usage (talk time) instead of making us by bundles of minutes? I don't give a shit about minutes. That the flipside to the data usage – voice usage declines. Granted data clogs shit more than voice….
End rant.
We are still in the same fucking boat! Fix the god damn network you fucks!
Agreed and couldn't have stated it any more eloquently myself.
you said it perfectly, they know apple is gonna jump ship sooner or lady to expand their market share so they figure screw us with this metered pricing while at the same time dont fix the problem until you actually have to. why sink 65 million dollars in one city thats a lot of money and according to new stories it didnt help one bit.
Looks like ATT made their money already and they are getting ready to burn the bridge in a reasonable way so they dont have to pay back the people that still have the contract. I dont think ATT even care what apple do anymore.
droid he i come if this goes threw!!!!!!!!
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Hold on! Does anyone know.. if Apple pays ATT for any app download??
Ok, so why does your title state "Why existing iPhone users don't have to worry"? It sounds like we do. I was expecting to read that you had some kind of news such as if we already have a contact it won't affect us. Bad choice of title… Existing iPhone users still includes those who use a lot of bandwidth. I mean, I don't use much, but it's the principle. I have "unlimited" for a reason. I would like to know that I can use all I want without having to watch or worry about it. What does AT&T expect? There will always be that small percentage that use their unlimited plan 24/7.
Now…I really doubt that anyone is able to consume 20GB like one user claimed to have done unless they are tethering. I'm guessing that people are tethering without AT&T being able to tell. That is going to happen though. If the phone is capable, there will always be some hack that allows users to break the rules. With that said, paying $30 a month should be enough to be allowed to tether. I'm sure many users barely use any data at all some months, like around 100MB or less. I'm talking about the older people who have an iPhone but mainly just talk on it. So AT&T can stop crying about usage. They never talk about how great it is to get $30 a month from people who don't even use data. I believe that it balances out. They say that 3% consume close to 40%. I'm betting that an even larger percentage like around 10% consume less than 1% – 5%. AT&T was just counting on forcing everyone to pay for an unlimited plan whether they used it or not hoping that most would be on the losing end. Now that they are the ones being hurt by their own plan, they want to change the rules. Ok, I'm done…
155 dollars a month and they want more. att are u gus out of your minds.
steven iphonehacks gonna charge by words for this long text same as att
Well if they do start metering it at least it gives me a good reason to opt out of my "unlimited" contract and switch to another carrier. If they do pull this crap I'm goin right into AT&T and getting rid of them.
2011, hmm,, it is good time to leave AT&T.
Read the contract….that won't get you anywhere.
Make sure you have your ad-blocker working so you don't pay for them eating up your 'unlimited' bandwidth!
Dang right!! haha
Good rant
this is bullshit…the only reason i'm with at&t is the iphone. if this goes through, i'll terminate my contract and go for the Droid.
IANAL, however… If AT&T changes current in-contract users from unlimited to a cap, then it would be a material change in the contract that you could opt out of – meaning you can tell them to GDIAF and walk away with your iPhone without paying an ETF. Most people won't, because they are afraid to unlock, but we know better.
In addition, I had two data cards that were unlimited. They started putting a 5GB/mo cap on data with new contracts, but my old contracts still stay at unlimited. This has been almost two years now.
See my above reply to electro. Hopefully only new contracts will have the cap or we'll get to opt out.
But you're right, we're already all paying a premium for data. My DSL is only $30 a month. I also pay AT&T $60/mo for a data card. I pay more per month for internet access than I do for electricity for a 3/2/1 house. Ridiculous.
And the three newest phones on my account are iPhones. I could easily opt out them and pay the ETF for the one contract phone left on the account. Slight problem… I don't have T-Mobile in my area… So, sell the iPhones and get shiny new google phones yay!