Say goodbye to unlimited
monthly bandwidth
Many AT&T subscribers in the United States are about to
face an adverse network price restructuring that could benefit the overwhelming
majority of its smartphone users, while harming those who use an excessive
amount of wireless bandwidth.
The US smartphone leader announced this morning that it is
introducing two new wireless data plans that make it more affordable for people
to enjoy the benefits of the mobile Internet. The first plan, called DataPlus,
gives customers the option to purchase 200MB of data for $15 per month. The
company claims this is going to be the plan that the overwhelming majority of
its users will subscribe to, with enough data to send and receive 1,000 emails
without attachments, 150 emails with attachments, view 400 Web pages, post 50
photos on social media sites and stream 20 minutes worth of video. The plan is
optimally designed to save up to 20 percent off their wireless voice and data
charges and is designed for people who primarily browse the web for news
content, social media and use non video-based smartphone applications. AT&T
states that 65 percent of its current smartphone customers use less than 200MB
of data per month on average, making this plan an arguable game changer for the
majority of smartphone users.
The second plan, called DataPro, gives customers the option
to purchase 2GB of data for $25 per month. According to AT&T’s synthetic
usage analysis, this plan will provide enough data to send and receive 1,500
emails with attachments, view 4,000 Web pages, post 500 photos on social media
sites and stream 200 minutes worth of video. AT&T states that 98 percent of
its current smartphone customers use less than 2GB of data per month on
average. In practice, this plan is most suitable for those who stream large
amounts of video over 3G and for iPhone customers who occasionally tether their
jailbroken phones to desktop or notebook devices (although AT&T has a
separate plan in mind for this particular market group).
According to some analysts, however, the big game changer
AT&T has announced today is the new overage system for its data plans. With
the DataPlus 200MB plan, customers will pay an additional $15 fee for each
additional 200MB of data consumed. With the DataPro 2GB plan, customers will
pay an additional $10 fee for each additional 1GB consumed. This is very simple
and straightforward. In fact, when taken into comparison with AT&T’s 5GB
DataConnect plan which charges an additional $50 per 1GB overage, the company’s
new DataPlus and DataPro options are very suitable options for the majority of
the smartphone market. The company has
stated that it will even allow customers subscribing to DataPlus 200MB and
DataPro 2GB plans to flexibly switch between the higher plan and the lower plan
at the beginning of their next billing cycles, depending on monthly usage.
Tethering is another offer that AT&T has announced as an
“add-on” exclusively for the DataPro $25/month plan. For an additional $20 per
month, customers will be able to legally use their smartphones as modems to
provide a broadband connection for desktops, notebooks, netbooks, tablets and
other computing devices. Tethering for the iPhone will legally be made
available when Apple releases OS 4.0 later this month. If we do a comparison
between the DataPro 2GB + Tethering plan ($45/month) and the company’s
traditional DataConnect 5GB plan ($60/month), the former compares unfavorably
to the latter and it would be a better choice to stick with DataConnect for the
largest possible bandwidth usages.
AT&T has also announced that Apple iPad customers will
be affected by its introduction of new data plans. The current $30/month iPad “unlimited”
data plan is being discontinued from the pricing lineup and will replaced by
the DataPro 2GB plan for $25/month. The company points out, however, that
current subscribers to the iPad data plan can continue unaffected by the price
changes, but will be obligated to downgrade to the DataPro plan if they choose
to discontinue service.
Many analysts have taken into account the broad scale
changes that AT&T has announced and have leveraged them against the
trending “spectrum crisis” that seems to have CTIA and the mobile wireless
industry up in arms. Mark Collins, AT&T Mobility Senior Vice President of Data
and Voice Products, made matters crystal clear by stating that “the concept of
unlimited data is a thing of the past, particularly in light of the oncoming
spectrum crunch to make wireless broadband an even more precious commodity than
it already is.” From his disposition, we can assume that mobile broadband in
the United States will follow the ways of Australia in regards to wireless
bandwidth caps.
“The U.S. wireless industry
is a virtuous cycle of investment and innovation, and spectrum is the lifeblood
of this industry,” AT&T Mobility CEO Ralph de la Vega stated during his
CTIA keynote in February 2010. “Smarter devices lead to a proliferation of
applications, which in turn drives more consumer demand for spectrum.” The
increased consumption of smartphones and applications means more consumption of
mobile data and more strain on back-end networks. Cisco Systems, a major
wireless network hardware provider, estimates global mobile traffic to increase
40 times from last year, with roughly a 108 percent growth from 2009 to
2014.
On the bright side, “the U.S. is also leading in the
commercialization of next-generation mobile broadband networks,” de la Vega
said. “U.S. GSM operators are deploying advanced HSPA to give customers 3G+
performance now.” The United States will be the first country to deploy LTE on
a wide commercial scale, and AT&T estimates that 53 million smartphones
will be sold in the US alone in 2010, compared to 25 million in China.
Through the tidal wave of announcements and ongoing concerns
about wireless broadband sustainability throughout the country, AT&T
insists that it has laid a solid framework for data pricing that should
continue all the way through to the company’s LTE rollout over the course of late
2010 and 2011.