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  • So is AT&T Ripping Off Data Users?

    June 3rd, 2010

    Just weeks ahead of the expected release of the next generation iPhone, AT&T has decided that they simply can’t afford to give you unlimited data access for $30 a month. Instead, they are setting up a two-tier program that should serve most light and heavy users.

    So is this just more evidence of rampant corporate greed, or does AT&T have a point? Well, here’s the deal: The top-of-the-line Data Pro package gives you 2GB of bandwidth for $25. Their PR spin doctors claim that only 2% of their customers abuse that limit, and they are allegedly causing poor network performance for everyone.

    The reason, I suppose, is that the worst “abusers” are spending inordinate amounts of their spare time downloading apps, movies and songs through AT&T’s network, thus helping to saturate finite system capacity. The new data program is designed to offer a good deal for the other 98%, and actually save you some money in the process.

    The pricing structure, however, doesn’t seem to make much sense. For $15 per month, you get 200MB bandwidth.  That’s only $10 less than the 2GB package. You will be warned if you are getting close to exceeding those limits, and you will then have upgrade options. If you are in danger of consuming more than 2GB, for example, an extra $10 will get you another 1GB, which ought to be sufficient for at least some of those remaining 2% of heavy users and abusers.

    Data Pro customers will also be able to set up tethering, which means you can use your iPhone as a 3G broadband modem on, say, your Mac or PC portable, for an additional $20, which actually seems a pretty sensible package when you examine similar deals from other carriers.

    You’re not forced to take one of the new pricing schemes. Those of you currently signed up for the $30 unlimited data plan will be “grandfathered,” which means you can keep that plan even if you upgrade to the next generation iPhone. The altered packages are primarily for those who sign up for new contracts, although you can switch if you like.

    One quick way to decide whether to make a move is to check your online usage on your AT&T account under the View Past Data Usage category. AT&T will display graphics of the amount of data you consumed for the previous six months, plus the choice of examining the stats for other timeframes.

    Now when I checked my account, I noticed that I came close to 200MB on occasion, but rarely, if ever, exceeded that amount. The main reason is that I do most of my Internet heavy lifting while connected to a Wi-Fi network, so I’m not taxing AT&T’s system. If you’re a light user, by all means downgrade to the basic plan. However, considering the slight difference in cost, I would probably switch to Data Pro, assuming I wanted to abandon unlimited. But even though I’ve been going through tremendous financial turmoil in recent months, my iPhone remains an essential business expense.

    Right now, AT&T’s main competitor, Verizon Wireless, plans to stick with their unlimited data programs, since it makes for provocative ad copy. But since so few users are being hurt, on the long haul that will probably change.

    More to the point, I’m not concerned so much with a more realistic data plan, particularly if it lessens the load on AT&T’s clogged cell towers. The real relief from slow performance and dropped calls, though, will be the promised upgrades to their network architecture. At this week’s AllThingsDigital conference, Steve Jobs said that he expected at least some relief by summer. Before you dismiss any promise made by AT&T, even if that promise is given to the CEO of Apple Inc., I have to tell you that call quality has improved tremendously in the three years I’ve been an AT&T customer.

    You see, at one time, there were neighborhoods here in the Phoenix area through which I couldn’t pass without losing most of wireless signal. The installation of new towers and the upgrades to existing equipment have pretty much vanquished the worst ills. These days, dropped calls are a rarity for me, and general system performance is little different from my former wireless provider, Verizon.

    However, if you live in New York or San Francisco, you may disagree. Clearly AT&T was caught flat-footed by the success of the iPhone and its tremendous drain on their network. Some suggest that Apple might be to blame, in part, because they weren’t familiar with the tricks of taming their smartphones for maximum connection efficiency without severely consuming network resources. While I suppose that may have been true at one time, Apple does use industry-standard parts for its communications hardware and they’ve surely been able to learn a few secrets from their network partners.

    It’s also true that Internet access on the iPhone is so seamless, more and more people are relying on these gadgets for surfing. That’s why AT&T had to look at the data plans a little more realistically.

    While I suppose some of you might have reason to complain about being cheated by a greedy wireless carrier, in the real world, you’ll rarely have need to exceed the new limits. Or just keep the plan you have to feel safer.

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