AT&T Moves Closer To Usage-Based Fees For Data 441
CWmike writes "AT&T has moved closer to charging special usage fees to heavy data users, including those with iPhones and other smartphones. Ralph de la Vega, CEO of AT&T Mobility and Consumer Markets, came close on Wednesday to warning about some kind of use-based pricing while speaking at a UBS conference. 'The first thing we need to do is educate customers about what represents a megabyte of data and...we're improving systems to give them real-time information about their data usage,' he said. 'Longer term, there's got to be some sort of pricing scheme that addresses the [heavy] users.' AT&T has found that only 3% of its smartphone users — primarily iPhone owners — are responsible for 40% of total data usage, largely for video and audio, de la Vega said. Educating that group about how much they are using could change that, as AT&T has found by informing wired Internet customers of such patterns. De la Vega's comments on data use were previewed in a keynote he gave in October at the CTIA, but he went beyond those comments on Wednesday: 'We are going to make sure incentives are in place to reduce or modify [data]uses so they don't crowd out others in the same cell sites.' Focus groups have been formed at AT&T to figure out how to proceed."
Re:Time Machine (Score:3, Interesting)
Comcast was yelled at for throttling access to "heavy users," but slashdot linked an article where it proved that heavy users do not actually impact performance on the network for everyone else. (Hence, the throttling was a bogus move.) My question is does this extend to cell networks?
It sounds like De La Vega is saying it's going to improve service when they educate smartphone users, and the users curb their heavy usage. Does heavy usage of a smartphone impact service for other phone users? Or is this another bunch of bunk?
What a joke (Score:3, Interesting)
Re:The classic double speak (Score:5, Interesting)
Sounds like they're targeting the iPhone, only from AT&T.
Company with fanatical users (Apple) creates a product that is data-heavy. AT&T must have seriously botched their usage projections, not bothered to do any, or figured they're just foist extra fees on their customers when it started to be a problem because they know anyone wanting an iPhone can't jump ship to a competitor.
They already differentiate (Score:3, Interesting)
If I had a Blackberry or an iPhone, they would charge me $30-40/mo just for data for said phone. Same deal for any smartphones that AT&T sells themselves.
Fortunately for me, I purchased a smartphone that AT&T doesn't sell (got it from Nokia's website) and can get away with paying $10-15/mo for "Unlimited" (i.e. 3GB/mo) data.
That said, I don't think I've ever used more than 400MB/mo, probably averaging less than 200MB/mo. Now if they would provide a 200 min/mo voice plan, I would be much happier. I've somehow managed to wrack up over 1,500 Rollover minutes in the past 5 months with a 450min plan....
Should electricity be charged per-watt? (Score:1, Interesting)
Electricity is on a per-joule (I refuse to use the so-called 'unit' of kilowatt-hour) basis, and that seems to work out just fine (this being analogous to being charged per data unit). In fact, it would be downright stupid to pay for it on a per-watt basis (analogous to per data unit/sec). Just curious as to why internet access is perceived in a fundamentally different way than electricity, in this respect.
Why use AT&T? (Score:1, Interesting)
Just ranked dead last in customer satisfaction [zdnet.com] by Consumer Reports, AT&T also illegally spied on American citizens and then successfully lobbied to get themselves retroactive immunity [eff.org]. Not only will they not be punished, but no one will ever find out the extent of their crimes. Technicians have stumbled into secret rooms [wired.com] used to "shunt its customers' Internet traffic to data-mining equipment" for the NSA.
And don't believe bloated Luke Wilson--many iPhone users I know tell me they have shitty GSM coverage.
Meanwhile, Time Magazine just called the Verizon Droid phone the top gadget of the year [time.com] and Droid has been rooted [alldroid.org], so you know it won't be long before a custom ROM [wikipedia.org] comes our way.
And now AT&T wants to charge for usage? Well, their exclusive contract is almost over with Apple. And if you ask me, not a moment too soon.
Keep blaming the consumer (Score:2, Interesting)
Verizon has the same kinds of customers as AT&T and they manage to handle high traffic conditions without grinding to a halt. I can't wait for my AT&T contract to expire. The breaking point for me was at a football game when my phone failed to complete a call or send a text message for hours. The guy standing next to me had Verizon and it worked fine. He let me use his phone to call a friend. I got that friend's voice mail because he is also on AT&T.
False Advertising (Score:4, Interesting)
Re:The classic double speak (Score:4, Interesting)
I'm really suprised they didn't try to blame this on jailbroken Iphones using tethering. It seems exactly like the type of thing they would scapegoat it on. They're trying to discouage both, and I could -actually- believe that's a -part- of it.
I'm guessing they so misjudged usage that even if they stamped out tethering they still would be over, so they're trying to charge even people who aren't tethering.
Re:Time Machine (Score:3, Interesting)
Probably true. Ironic that defense spending spawned the internet....
Re:The classic double speak (Score:2, Interesting)
It went like this:
Apple: We are producing a new phone that will allow you to get million of new customers, stop hemorrhaging customers, and compete effectively against Verizon. You want it?
AT&T: Oh, yes please!
When the iPhone first came out, AT&T was in desperate position. It was bigger than Verizon, but its network was a mess, and it was losing customers. Verizon had the better network and even though Apple offered Verizon the iPhone first, they didn't want it if Apple was going to tell them how it should work. Verizon doesn't operate that way. They tell phone companies what phones to build and what features to offer and at what prices.
Also, when the iPhone first came out, it didn't have all those cool apps. You could surf the Intertubes, but there weren't all those cool network hogging apps.
It will be an interesting competition. I understand AT&T's position. They simply cannot grow their network fast enough to keep up, and the lack of bandwidth is a pain shared with all customers. The problem AT&T is having is that the iPhone isn't unique anymore. There is Droid and Palm and they'll still have unlimited data plans. Plus, if the iPhone U.S. exclusivity ends, the other carriers will quickly start offering the iPhone too.
AT&T can't charge for data plans if no one else does.
Re:Time Machine (Score:4, Interesting)
Say I build a house and rent it out. Once the house is built it doesn't really cost me anything from month to month So the rent must be almost zero right?. Of course I had to borrow to pay for the house (the infrastructure) and I need to make monthly payments on top of the small costs involved with repairs, council fees, etc.
You missed his point.
Let's say your house costs $500/month in upkeep/taxes/overhead. and another $500 in lost investment opportunity (interest on the value of the home). A reasonable rent would be somewhere along the lines of $1100/month. At that rate, you would be making 10% profit, which is a good target to shoot for in almost any business.
If you were to charge rates similar to what the phone companies are trying to charge for overage, then you would be charging $10,000/month.
Of course, since we are talking about the rental market, which is competitive, there is no way that you would ever be able to charge that as people would flock to your competition. However in the data market, all the companies have somehow and independantly stumbled onto this extremely inflated cost. They get away with it for two reasons, their product isn't a major life need, and people aren't yet used to using services which make use of the connnections which these companies were selling them.
Why is this a problem? (Score:5, Interesting)
Data has shown that iPhone users average 400MB/month. This is far and away the most by any group. AT&T charges $30/month for the iPhone data plan. That equates to over $60/GB but AT&T and just about every other carrier charge that amount for 5GB/month data plans. Doesn't make sense does it. Carriers are claiming they can't make money at $60/GB data while they charge only $12/GB on data only plans.
I think we would all be giddy as school girls if they just charged everyone $12/GB for data making the average cost for data for iPhone user drop from $30 to $6. But for some reason I doubt that will happen.
Re:Time Machine (Score:5, Interesting)
The problem is that ATT doesn't really want metered access either. Based on the statistics they are putting out, a huge majority of the iPhone users end up using very little of their data connection. If ATT moved to a metered access they would lose money because people would end up not using enough to add up to $30/month unless ATT priced the data at some astronomical rates. If they did that, they would simply be shooting themselves in the foot because people would quit using data (that's one way to fix the network problems lol).
So, the solution is to keep everyone on 'unlimited' at $30/month and issue press releases blaming these 'heavy users' for the network problems without actually doing anything to fix the issue. It's not really ATTs fault, it's these mysterious heavy users fault. Don't blame us, blame them while we keep laughing all the way to the bank and you (att users) keep dropping calls and getting crappy service. Brilliant plan actually.
Get less data greedy browser (Score:2, Interesting)
Well I tested Opera mini against symbian browser in my Nokia, but still:
;)
BBC main mobile page:
Operi Mini: 7kB (!); 3 good q thumbnails
Symbina in build browser: 26kB; one thumbnail more - commercial
CNN main mobile page:
Opera mini: 13kB
Symbian in build browser: 68kB; one thumbnail more - local weather
Engadget main page, tested several times, couldn't bealive the results:
Opera Mini: 177kB
Symbian in build browser: 2.50MB (!)
Ofc, App store would never allow Opera
Even dough Opera uses their proxy servers, for compressing the data and sending it to clients, the loading of pages is still faster because of the good compression and add-blocking.
Re:Time Machine (Score:3, Interesting)
The USA is too spread out for traditional mass-transit systems to work very well here, except in a very few exceptional places with high density, like NYC, SanFran, etc.
The best solution to mass-transit in the USA is "PRT", personal rapid transit, like SkyTran [skytran.net]. With modern computer technology, we don't need an obsolete mass-transit system that takes lots of people from point A to point B; we can now make a system that takes individuals anywhere they want to go in a grid.
here's why at&t can't keep it up (Score:3, Interesting)
http://blogs.broughturner.com/2009/10/is-att-wireless-data-congestion-selfinflicted.html [broughturner.com]
Re:Time Machine (Score:1, Interesting)
This is a very smart point. Will the advertisers pay for their own ads?
Re:Time Machine (Score:2, Interesting)
Re:Time Machine (Score:3, Interesting)
The infrastructure was built using government funds.
For a cellular network?
Please enlighten me, I'm not familiar with this.
Re:Time Machine (Score:3, Interesting)
> this begs for network infrastructure improvement that they are not willing
> to do.
Are you prepared to pay for it?
> ...milk the heavy users under the banner of better service to everyone.
I see no reason you heavy users shouldn't pay more than I do.
Re:Time Machine (Score:2, Interesting)
> Wireless companies have a much harder time adding more channels.
As much as Telcos would like you to believe that (I used to work for one), spectrum costs don't quite tell the whole story. Sprint, in particular, has wireless bandwidth to burn. Ever wonder why Sprint is the only carrier with a fetish for mobile TV service that almost nobody uses or cares about? Sprint uses a HUGE chunk of its wireless bandwidth for backbone connectivity. Why? Their spectrum is bought and paid for. It's a sunk cost, and they have way more of it than they're going to need for *decades*. So, it's cheaper for them to just use THAT for tower-tower and backbone connectivity than it is to pay the local incumbent phone company for T1s or fractional DS3 service. Best of all, when customers complain, they can mutter the usual refrain about bandwidth scarcity, knowing that people who aren't in the telco industry will actually believe it.
AT&T pulled a similar stunt in Dallas with their fixed wireless data service 10 years ago. People in North Dallas were paying ~$50/month for wireless internet service that piggybacked off their cellular network and was supposed to be at least as fast as 1.5mbit ADSL. The real-world performance was terrible... barely better than ISDN. Then some friends noticed something... they had nearly instantaneous ping times to each other, and had insanely fast peer to peer connectivity (they were both AT&T Fixed Wireless customers who lived near each other). They did some more experiments, got others involved, and a month or two later, the truth came out: AT&T was basically sharing a single T1 data connection at their NOC among all their customers in the north Dallas area. The limiting factor wasn't wireless bandwidth, it was just their convenient scapegoat that they could blame over and over, knowing most people would believe them. Don't believe me? Google +"AT&T fixed wireles" +Dallas and read all about the scandal. The worst part about the whole thing is the fact that this was *AT&T*, who even at the turn of the (21st) century had backbone connectivity to die for compared to just about everyone else (Worldcom owned more fiber, but most of it was dark or went to small towns. AT&T owned a huge chunk of America's high-value lit fiber that connected big cities). They just didn't give a shit about their customers, and weren't even willing to spend the money deploying abundant (hell, sinfully excess) resources to customers who were supposedly paying to enjoy it.
AT&T's iPhone problem NOW isn't that they don't have enough wireless spectrum... it's that they don't have enough of their spectrum allocated to iPhone data, and they don't have enough backbone connectivity to the rest of the internet.
Up until ~2 years ago, T-mobile DID have a legitimate excuse... in most big cities, and plenty of small ones, they really WERE hurting for bandwidth, mainly because their entire American network was mostly cobbled together by buying up small carriers with a single spectrum license for the smallest chunk of bandwidth money could literally buy in their markets. On the other hand, they now have almost as much bandwidth to burn as Sprint does did before it bought Nextel (BTW... three guesses why Sprint doesn't really care if Nextel customers leave, and why Sprint's CDMA phones don't use Nextel's old bandwidth. Here's a hint: they bought Nextel so that in the markets where they WERE feeling a bit constrained, they could use NEXTEL'S spectrum for their back-end connectivity and free up more 1900MHz bandwidth for CDMA phones).
Verizon lies somewhere between AT&T and Sprint. They don't quite have spectrum to burn the way Sprint does, their existing spectrum isn't divided up and balkanized as badly as AT&T's, and they now have fiber backbone connectivity to die for (the entire reason why they bought MCI/Worldcom). In a way, they're kind of like AT&T was with their Dallas fixed wireless service... it's not so much scarcity of resources as resistance to maximizing the use of