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AT&T Businesses Communications The Almighty Buck

AT&T Kills $10 Texting Plan, Pushes $20 Plan 348

Hugh Pickens writes "AT&T is scrapping its 1,000-texts-for-ten-bucks plan and replacing it with a plan that offers unlimited texts for $20. Users who don't want the unlimited plan can opt to pay 20 cents per text. Current AT&T subscribers are grandfathered in, so you can stick with whatever plan you selected when you signed your contract. 'The vast majority of our messaging customers prefer unlimited plans and with text messaging growth stronger than ever, that number continues to climb among new customers,' says AT&T. The news has not been received warmly in the tech blogosphere. 'AT&T calls this "streamlining." We call it what it is: an outrageous, gigantic scam,' writes Sam Biddle in Gizmodo. 'AT&T's taken away new customers' option to spend less, whereas carriers like Verizon still offer tiered texting plans for varying budgets.'"
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AT&T Kills $10 Texting Plan, Pushes $20 Plan

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  • by TheSpoom ( 715771 ) <> on Friday August 19, 2011 @12:11PM (#37143638) Homepage Journal

    They'll charge whatever the market will bear. Luckily for them, they partially control the market too. Imagine what the market would bear if they acquired Verizon as well...

    • Re:It's the market (Score:5, Insightful)

      by mangino ( 1588 ) on Friday August 19, 2011 @12:23PM (#37143800) Homepage

      That would be true if there was a well functioning market. A market of essentially two companies armed with contracts does not make for a well functioning market. It would be better to say:

      They extract monopoly profits because they can.

      • That would be true if there was a well functioning market. A market of essentially two companies armed with contracts does not make for a well functioning market. It would be better to say:

        They extract monopoly profits because they can.

        And yet I never see people cursing out Intel/AMD or ATI/Nvidia on slashdot (and of course, now it's just three companies). If you ask an economist, anything less than five competitors of exactly equal capability (not implementation skills or resources, mind you, but the theoretical ability to compete) is a disaster. I don't think any telecommunications market or pc component arena has that many matched competitors right now.

        • Are you on the same slashdot I am? I see people cursing Intels monopoly and praying that AMD does well so we don't return to the Bad Old Days (tm) when Intel ruled CPU prices with a more iron fist than they do today all the time...

          It's not as vitriolic at the telcos tend to get, but i that's a function of the fact that my tax dollars aren't being given to intel to support their monopoly (at least not in anywhere near the quantities the telcos get)
      • That was kinda the point I was driving at.

      • The irony of a free and competitive market is that it most lavishly rewards those who find a way to make the market controlled and anti-competitive.
    • I remember when I got my first 2-way SMS phone, it was only 2 cents to receive and 10 cents to send a message, most providers used to have no fee to receive SMS messages including on prepaid plans (T-Mobile). Now its 20 cents to send and receive.
    • AT&T also just announced that they will begin throttling mobile users on Oct. 1 who use some unspecified amount of bandwidth per month, until the next month's billing cycle begins - even if they are on one of the old (grandfathered) unlimited plans.

      Until customers punish them with defection, AT&T will continue to do whatever they can to provide less for the same price, or a higher price, to make up for their lack of foresight in developing their data network.

    • Under the my new plan for texting, each text costs only 1 penny and you don't have to pay that till your conversation with a friend is finished. moreover only the person that sends the second to last text has to pay. As long as you are the last person to send a text withing 15 seconds of the previous one you don't pay!

      Texting prices are a total rip off. it costs at&t almost zip to do this, so I figure why not make it as big a scam as humanly possible?

      moreover if you have a data plan texting ought to

    • Re:It's the market (Score:5, Insightful)

      by jellomizer ( 103300 ) on Friday August 19, 2011 @12:56PM (#37144324)

      These guys seem to be missing the big picture here. They are missing out a lot of great returns for the future.

      Verizon grows in wireless was because they had some of the best plans back in the late 90's. Back when Cell Phones charged you for Local, Long Distance calls, roaming fees.... Verizon was one of the first to give people a plan that allows a call to be a call no matter where you were at or who you were calling... A big deal back then. It opened Cell Phones for being a toy for the rich to an every-man tool.

      But now Verizon AT&T Sprint and everyone else is not taking it to the next step. Unlimited Plans/Unrestricted plans.

      Customers want to get rid of their cable companies. They want their internet plans to allow unrestricted tethering so they can get internet they can use at home or anywhere else. They want to use their phones without having to worry about a huge bill later on. A company who does the big push for this, and has the infrastructure to support it will Make a LOT of money and get a lot of switchers right after their other contracts expire.

    • I do wonder how much longer it will bear texting. Now that larger and larger percentages of the cell phone market have smartphones, why pay for a separate text plan when email can do everything texting can better? I get a sound on my phone whenever I receive an email just like a text. I also can view and search all my emails from the gmail client and enjoy the use of a keyboard for replies whenever I'm at a computer (which is a rather significant percent of the time.) All this, and it doesn't cost a cent mo

    • It's not just any change the market will bear, it's thinking ahead. They're thinking that in 5 years time, RIM/Apple/Google will have their own messaging systems that are very popular. 90% of people will not be using texts to communicate. They're making sure that even if you want to send just 1 or 2 texts to a few people with dumb phones, you still have to pay $20 a month for the privilege.

    • When a company is charging 10,000,000 Percent [] more for something than they evidently need to, I would say that's an indication that the free market, competition, and or consumers are failing miserably, and some type of legislative action is needed to correct it.

      "The market will bear it" seems like a pretty shitty justification to allow such excesses to continue. The market is creating monsters here. Excessive profits aren't leading to more jobs, they're leading to buying off the government, which leads
    • by cjb658 ( 1235986 )

      Obligatory comic []

  • virgin has android phones with totally unlimited plans. and their android phones are only $149

    oh wait, someone with an IQ that is higher than everyone here combined has figured out that if you sell a crappy and slow phone it will limit total data usage and that's why they can sell unlimited. or that the usual whiners don't want to pay $700 for a cell phone and then complain why the carriers are charging so much money.

    • There's more to it than just that. I had a co-worker who absolutely hated what AT&T has been doing... stomping around furiously. Why didn't he just change? "Friends and Family" plans... that and coupled with the fact that some friends and family don't have other options where some of them live.

      It's never quite as simple unless you're a hermit or a selfish/self-centered person.

      In any case, my T-Mobile plan beats anything AT&T offers on every detail and strangely, I have not seen any mysterious cha

  • This is why I stick with Tracfone... I typically use 150-180 minutes per month, including 20-30 text messages (sending and receiving). I'd love to go with Verizon, as they're the only carrier with coverage in most of NY and would settle for ATT... except NONE of the major carriers offer plans that wouldn't be a huge waste of money to me. Even their pre-paid plans are considerably more expensive than Tracfone (I pay about 7 cents per minute, sending or receiving a text counts as 0.3 minutes).

    • Tracfone is great as long as you don't need 3G (which I don't). I text and talk all I want to, and my total monthly bill is around $15. They even have QWERTY keyboard and touchscreen phones, and they have coverage EVERYWHERE.

      Tracfone is not for everybody, but it at least illustrates the absurdity of 20-cent texts!
    • by Macrat ( 638047 )

      This is why I stick with Tracfone...

      Uses AT&T, T-Mobile and Verizon networks on their locked down phones.

      You should just use T-Mobile and cut out the middle man.

  • by medcalf ( 68293 ) on Friday August 19, 2011 @12:24PM (#37143812) Homepage
    Since Apple is introducing technology in iOS 5 for an SMS-like service among all iPhones and other iOS devices (and iChat, too, IIRC), AT&T's SMS revenue is about to plummet. And that's one of the easiest ways AT&T has to up the dollars per customer metric. (How many people use tethering? Probably very few.) So AT&T sees this, no doubt, as a way to keep their SMS revenues up. Everyone else will see it as a reason to dump SMS altogether and use an IP-based rather than cell-based messaging service. Now if only Apple and Google could agree on interoperable protocols for stuff like this....
    • Everyone else will see it as a reason to dump SMS altogether and use an IP-based rather than cell-based messaging service.

      I'd be all for that if not for one little problem: if you don't use the cell towers, and you're not near an open WiFi hotspot, how are you supposed to send your Internet based text messages? The software for sending text messages via IP is a trivial issue. The problem is Internet connectivity without cell service.

      • by Artraze ( 600366 )

        Uh... So? If you don't have a connection, you can't send anything, including SMS and iOS messages. If anything the iOS messages are more flexible because they work over WiFi too.

      • by medcalf ( 68293 )
        Cellular data service. On an iPhone (and IIRC, on Android as well), that is the last fallback measure for data. On iPhones, it's a little open circle where you would normally see a 3G or E (for EDGE). Slow, but it works, and for small messages like SMS, it should be fine.
    • Google Talk and iChat both use XMPP, so it seems like they've already got an interoperable protocol...
  • Why is this more outrageous than offering only unlimited internet access, instead of tiered with data caps?

  • by Alyred ( 667815 ) on Friday August 19, 2011 @12:28PM (#37143872)
    'The vast majority of our messaging customers prefer unlimited plans and with text messaging growth stronger than ever, that number continues to climb among new customers,' says AT&T.

    Well, yeah... if their only choices are unlimited or nothing...
  • If someone has a data plan for $30 that is used to get data from the internet, from your computer via wifi(or tethering)..etc in the hell is this different than a text message...or better yet i would assume that this is WAY more expensive than sending a measly text message. I want to know how they continually get away with this disregarding the fact that customers have not woken up to this. The FCC, congress someone needs to pry deep to find out why we are paying $30 a month for data then pay $2
    • If someone has a data plan for $30 that is used to get data from the internet, from your computer via wifi(or tethering)..etc in the hell is this different than a text message...

      It isn't fundamentally, from a user-experience perspective, for smartphones: in fact, if you have a smartphone, there's any number of apps and services that will let you use the data connection to send and receive text messages for free [including sending to and receiving from people who have only SMS service on their dev

      • ok i downloaded google voice for my android. i have it linked up with my phone number after going through the wizard. However i do not need to use to make calls - i never go over my minutes. i just need to use it to send and receive text messages. i can go to "Labels" and then hit "Text" but i am not sure how to send people text messages or how to make sure i receive them via google voice and not through the VZ service.
        • i went to the help in the google voice app and it says that if i want to send a txt i have to go to the inbox then press the menu key then press "Compose" but that option doesn't come up in the menu options. All i have is Refresh, Labels, Balance, Search, Settings and Help. Anyone got any pointers?
    • To give a technical answer, in GSM systems (like AT&Ts), text messages go over the voice channel, not the data channel. It's similar to data going over a 56k modem (aka, modulated onto the analog phone line) vs data going over a broadband connection (digital end-to-end).
      • well I have verizon and they are CDMA - so are text messages sent differently than data? I have an android incredible 2.
      • And to add to your answer: in GSM systems, SMS piggy-backs on existing required signaling that is needed for identifying when a cell phone comes into a cell tower's signal reach.

        So, how much does it cost a GSM provider to provide SMS service on top of cellular? $0.

        They expand the radio capability as they get new subscribers, sure... but that's to handle additional phone calls.

        There is no such thing as a separate cost to expand SMS capability.

        Messaging is darn near *pure profit* for a telecom company.


  • "No one ever went broke underestimating the intelligence of the American public."

    It's amazing how people line up in droves to pay for a service that costs the person providing it basically nothing. Sure, the phone and data network cost to implement and maintain. But SMS messages use so little bandwidth, their incremental cost is basically zero. Yet people pay every month for the privilege of using that service. It's pure profit for the phone company.

    Now, if the phone companies were to use the text messa

    • But SMS messages use so little bandwidth, their incremental cost is basically zero.

      From what I understand, the incremental cost actually is zero. SMS hides in the spare bandwidth of maintenance packets used to check for reception and synchronize with towers. I've always heard that the 140 bytes for a text was simply wasted before they figured out how to monetize it (at four-figures a megabyte, no less).

  • Get Google Voice. It's free... at least for the time being. If Google ever dares charge even a thin dime for them, they'll probably face a mutiny.

  • Are iphones really worth all this strife? Just sayin.. if it sucks, put your money into the competition. It's really the only way to change it.

  • Whenever I get annoyed about how everything is so much cheaper in the US (houses, food, clothes, computers, cable internet, ...) it helps to remember how at least you folks are screwed over on telephones, both fixed and mobile. By cost and service.
    - "What, you must pay to *receive* calls!? A phone plan costs *how* much? pay extra for tethering, really?" Ah, schadenfreude.

    • We're also screwed on broadband availability, and if you have a choice in providers you're one of the lucky ones.

  • Don't worry citizen! In unrelated news, the Ministry of Plenty has released a statement that they will be increasing the chocolate ration to 15g tomorrow.

  • by RobinEggs ( 1453925 ) on Friday August 19, 2011 @12:47PM (#37144156)
    Don't forget that text message costs are exclusively determined by lying to you and constant bullshit experiments in "what the market will bear".

    Texting is almost completely free for carriers. The messages piggyback to and from your phone in the spare bandwidth of the tower synchronization signals the phone uses to check reception and select towers for voice/data transmission. The only infinitesimal cost that might exist to the carrier is transmitting 140 lousy bytes from one tower to another tower; the capacity on the towers themselves is free.

    Now this might have changed somewhat in recent years; I'm not a communications engineer. But I don't think it has. And I'd bet my life that even if it has, texts still don't cost the carriers more than 0.1 cents.

    This is the very picture of evil corporate overlords plotting in a dark tower to see how much money they can squeeze out of you for nothing and avoid advancing technology as long as possible. Real technology entrepreneurs like George Eastman struggled constantly against themselves, trying to make things cheaper and better for the consumer. Eastman in particular tried desperately to obsolete his own products in favor of offering consumers even better, years before the prior product would otherwise have dropped in sales; today we call that cannibalism, and most tech companies struggle like hell to avoid a whit of it. (People acted like Apple was batshit crazy for not better managing their product line when iphones started to cannibalize ipods. Nevermind that iphones cost hundreds more, so even that cannibalism is pure profit.)

    When's the last time you saw a company that put out everything they had, every time, and didn't hold something back for upgrade cycles or a magical September festival of worship?
  • Maybe AT&T decided that they needed to get more people to buy Blackberries for Blackberry Messenger.

    I can't help but feel that moves like this will accelerate the adoption of other messaging systems. AT&T may see a miniscule bottom-line improvement, but they don't even have the iPhone exclusivity to draw in the hipster crowd - now if you "need" an iPhone and use perhaps a few hundred messages a month you'll go to Verizon, and some people will just decide that the iPhone isn't worth the extra hundred
  • They charge $0.20US per INCOMING OR OUTGOING TEXT if you dont have a package. They intentionally price it to "encourage" you to do what is best and buy a plan.

    They are knowingly ripping everyone off. and laughing while petting their evil lap cat....

  • Atleast in India, though Mobile tech is somewhat behind US tech, all we pay for sending a SMS is either Rs 50/month for 500msgs/day , or Rs 6 per month, with unlimited messages @ Rs 0.01/msg

    Rs 45 is approx $1

    How come rates arent cheaper there (considering that a higher no. of people would be using the phones anyways)

  • An SMS message has a maximum of 120 characters, which is packed into 140 bytes. $10 per 1000 messages works out to 1 cent per message, or 1 cent per 140 bytes. That gives us 7.31 cents per kilobyte, or 73.1 dollars per megabyte. Of course it's actually a lot higher, since you don't always send exactly 160 characters per message. If the average message is only half the maximum length, we get a whopping 146.2 dollars per meg. I don't know how many texts people send a month on average, but if it's less than 20

The IQ of the group is the lowest IQ of a member of the group divided by the number of people in the group.