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AT&T Caps Netflix Streaming Costs At $68K/Yr 433

theodp writes "What would you say if you went to join a gym and were told that it could cost you anywhere from $360 a year to $68,000 a year for the exact same usage? Don't be ridiculous, right? Well, that's really not so different from what the potential costs of streaming video on an AT&T smartphone are. According to AT&T's Data Usage Calculator, 1,440 minutes worth of streaming video consumes 2.81GB, which — if you manage to keep Netflix fired up all day and night — would result in a $360 annual bill under the grandfathered $30-monthly-unlimited-data plan, or $68,376 under the new $20-monthly-300MB plan. Still, that didn't stop a spokesman from characterizing the new AT&T data plans as 'a great value' for customers."
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AT&T Caps Netflix Streaming Costs At $68K/Yr

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  • So when did... (Score:4, Insightful)

    by neonKow ( 1239288 ) on Tuesday January 24, 2012 @09:55AM (#38804159) Journal become our God-given right to stream Netflix 24-7? And to get outraged that there is a bulk discount? AT&T has many, many issues already, so do you really need to contrive a completely unrealistic one to make a point?

  • Bullshit Strawman (Score:5, Insightful)

    by Anonymous Coward on Tuesday January 24, 2012 @09:57AM (#38804197)

    Yes, because it's entirely reasonable that someone would sign up for the lowest possible data plan, and then use as much bandwidth as possible for every second of every day. Obviously, that plan is designed for people who intend to use streaming very little, if at all, and it is a very good value for those people. No, not as good a value as the old $30 unlimited, but that was obviously not sustainable as phone bandwidth usage increased massively. Remember when the $30 unlimited plan was created, Netflix for the phone didn't exist, and most phones struggled to stream very low res video.

  • Re:So when did... (Score:4, Insightful)

    by SJHillman ( 1966756 ) on Tuesday January 24, 2012 @09:58AM (#38804199)

    The point is that some customers get a 99.48% discount for buying in bulk. How many other places offer that extreme of a discount? Should I get two McDoubles for a penny if I go to McDonalds every day?

  • by jeff4747 ( 256583 ) on Tuesday January 24, 2012 @10:03AM (#38804263)

    AT&T offers larger chunks of data for less per megabyte. So if you're expecting to stream 3GB, buy 3GB.

    You wouldn't be a complete moron and buy the smallest data plan and then let it up-charge you over and over again.

  • Re:So when did... (Score:0, Insightful)

    by Anonymous Coward on Tuesday January 24, 2012 @10:09AM (#38804321)

    If that is what McDonald's wants to do, and you agree, then sure. If one of the two parties involved doesn't take the deal, then no.

    Why should someone who isn't party to the transaction have any say?

  • by brainzach ( 2032950 ) on Tuesday January 24, 2012 @10:09AM (#38804333)

    You don't calculate your water bill based on if you leave all the faucets in your house on for 24/7.

    I don't see the big deal as long as AT&T notifies the customer of overages when they occur.

  • by scottbomb ( 1290580 ) on Tuesday January 24, 2012 @10:10AM (#38804337) Journal

    "How much *profit* should they be allowed..."

    As much as the market will pay. And comparing DSL to cellular is comparing apples to oranges.

  • Re:So when did... (Score:5, Insightful)

    by rtaylor ( 70602 ) on Tuesday January 24, 2012 @10:10AM (#38804339) Homepage

    It's large.

    My gym charges about $650 per year or $20 for a day. Some have a $10 for an hour fee.

    Are the $20/day people supposed to be outraged at paying $7300 for something I'm paying $650 for, or should they be happy they saved money for something they didn't really want.

    The $10/hour guy would pay $87,600 if they used it all day every day; but why would someone doing that be paying by the hour?

  • by Anonymous Coward on Tuesday January 24, 2012 @10:13AM (#38804379)

    It's still way overpriced. It should be $1 for 1GB. We just need competition and the market will correct itself.

    Well, I think that your plan is overpriced. It should be $0.01 for 1GB.

    See how pointless it is when you make up numbers just to make yourself happy?

  • by jeffmeden ( 135043 ) on Tuesday January 24, 2012 @10:15AM (#38804403) Homepage Journal

    The max cost need to be in there, and having to pay $70000 just because you forgot to turn off your phone is not a good thing. This is important because people do not see this problem, and tend to laugh at "losers" affected by it. Pressure should be on the Telcos to have fair pricing, not on the customers.

    So no it's not alarmist, it's trying to expose telcos for what they are, and hopefully change them.

    If you "forget" about your phone the battery will die after about 45 minutes of this kind of usage, so, not to worry! And for what it's worth this has been going on ever since the invention of long distance; you have always been able to dig a real deep hole for yourself. Say you call your aunt in Armenia and you both forget to put the phone totally back on the hook; one month later you will have an $86,000 phone bill. Think that's changed any? You can opt to purchase more affordable plans, which is no different than in this scenario, but if you choose to be completely dumb about it yes you can find yourself owing a LOT of money. That's the price of being a grownup.

  • Re:So when did... (Score:5, Insightful)

    by PopeRatzo ( 965947 ) * on Tuesday January 24, 2012 @10:30AM (#38804589) Journal

    Maybe a better question is "how much does AT&T pay for that bandwidth for which they charge $20/250MB?

    The issue might not be who gets the discount so much as "why is AT&T price-gouging for something for which there is so little choice?"

    When you've only got a couple of choices, and AT&T actively works to keep the number choices limited, they have a privileged position. When a company is granted such privilege, they should be held to some responsibility, one of which is not to price-gouge.

    "Price-gouging" is defined as "a pejorative term referring to a situation in which a seller prices goods or commodities much higher than is considered reasonable or fair". Who wants to argue that $20/250MB is "reasonable"?

  • by realityimpaired ( 1668397 ) on Tuesday January 24, 2012 @10:36AM (#38804675)

    It's also cellular data that they're talking about. Anybody who would watch Netflix 24/7 in high definition over a cellular connection needs to have their head examined. (you did notice that the link to the "data usage calculator" was for the wireless calculator, right?)

    Over a wired connection, the rate is significantly more reasonable. But it wouldn't make as interesting a sensationalist headline.

  • Re:So when did... (Score:5, Insightful)

    by John Courtland ( 585609 ) on Tuesday January 24, 2012 @10:39AM (#38804723)
    Because their tax dollars helped build and subsidize the infrastructure that AT&T uses.
  • by Anonymous Coward on Tuesday January 24, 2012 @10:48AM (#38804877)

    Wrong. These are regulated monopolies; we trust them with our very limited spectrum with the understanding that they will provide services that are in our best interest. This includes in terms of price.

    The gradual lessening of service per dollar is a genuine concern.

  • Re:So when did... (Score:5, Insightful)

    by Sentrion ( 964745 ) on Tuesday January 24, 2012 @10:51AM (#38804929)

    But corporate lobbyists also spent fortunes to get the government to subsidize their infrastructure. They are free to do what they want with what they bought and paid for. If you want your representatives to actually represent your interests then you should spend the same millions that the corporate lobbyists do. That is how our democracy works.

  • Re:So when did... (Score:5, Insightful)

    by mcgrew ( 92797 ) * on Tuesday January 24, 2012 @10:56AM (#38805009) Homepage Journal

    Not a God-given right, a CONTRACT-given right. I'm not paying by the bit for computer internet access, why should I pay it for internet access on my phone? And BTW, I have AT&T for home internet, the phone is Boost Mobile, unlimited everything for half the price of AT&T's cheapest phone data plan, even if you don't hit AT&T's caps.

    And I could watch TV 24/7 (well, ok, 16/7, stations didn't run late at night back before the stone age) for FREE fifty years ago. I'm still watching for free. Cable? Why? A hundred channels of crap I don't want to watch, most of which are on the internet hosted by their networks (I have kubuntu TV, my computer uses the TV as a monitor).

    Why do you expect me to pay for what was once free, and especially for what's free right now? No wonder everybody's broke, they're throwing their money away on bottled water, TV, radio, exercize, data, music... shit that they can get for free. What a bunch of maroons, as Bugsy would say! Pay five dollars for a goddamned cup of coffee when I can buy a two pound can of Maxwell House or Folgers for ten, and have a whole pot of coffee every day for a month? How fucking stupid would I have to be??? Kids, if you have money to waste, give your charity to the poor, not the rich bastards that own Starbucks and Comcast.

  • Re:So when did... (Score:5, Insightful)

    by Anonymous Coward on Tuesday January 24, 2012 @11:11AM (#38805273)

    Moreover, these Internets make heavy use of public resources. In the case of wireless, it is a public spectrum they are leasing. In the case of wired, they make use of the public right of way. The public has every right to see that its resources are used in a manner that maximize the public benefit, and corporations that cannot meet that challenge should not be allowed to use said resources.

  • Re:So when did... (Score:5, Insightful)

    by neonKow ( 1239288 ) on Tuesday January 24, 2012 @11:17AM (#38805349) Journal

    They might not have an unlimited plan anymore, but they're offering more than a single $10/hour plan. There are 3 GB and 5 GB plans in addition to the 300 MB plan, which are perfectly reasonable choices if you plan on watching a ton of Netflix.

    No one streaming Netflix 24/7 is going to be on the 300 MB plan, so the fact that it would cost $68K to do so on that plan is as stupid as claiming 100,000 instances of a song pirated is $300K in damages.

  • Re:So when did... (Score:5, Insightful)

    by John Courtland ( 585609 ) on Tuesday January 24, 2012 @11:23AM (#38805433)
    Wait wait wait. So you're saying that AT&T should be granted a near monopoly in the markets it controls (via government-subsidized bootstrapping), and then not be beholden to the tax payers? I'm sorry but I don't think I can take you seriously.
  • Re:So when did... (Score:5, Insightful)

    by b4dc0d3r ( 1268512 ) on Tuesday January 24, 2012 @11:32AM (#38805593)

    No, that's not a good question, unless everyone is asking it. Text messaging rides on the backs of empty space in the network ping, costing nothing to the provider. But rates have gone up from 10 cents to now 40 cents.

    People will pay whatever they value the service to be.

    I have fought this for as long as I could - I didn't buy a cell phone, I didn't have cable or satellite TV, I didn't pay money for anything I thought was overpriced. But everyone around me did. $500/mo apartment with $140 tv + internet package, and complaining about not having money.

    I told people where they were spending ridiculous piles of cash, they didn't care, they wanted the service. I tried to educate them, honestly I did.

    And your argument that choice is limited doesn't really hold up - Sprint has been offering "truly unlimited" plans. This is basic capitalism. No one cares what it costs to make something, only what they are willing to pay for it. And very few people like me are truly outraged anough to actually not purchase something, they grumble and fork over the cash.

  • Re:So when did... (Score:5, Insightful)

    by Bengie ( 1121981 ) on Tuesday January 24, 2012 @11:47AM (#38805861)

    They pay for it because of a lack of choice.

    "all other providers (of which there are several) also charge similar fees": This argument only works if all providers have similar coverage/phone-selection/etc.

    There was a recent customer study that showed AT&T had one of the largest customer bases while having a customer satisfaction near 0/5. How does a company have horrible customer satisfaction while retaining its customer base? By having an "effective" monopoly. All the down sides of a monopoly without technically being one. Implicit anti-trust?

  • Re:So when did... (Score:3, Insightful)

    by Anonymous Coward on Tuesday January 24, 2012 @11:54AM (#38805991)

    There are many large projects that no company(not even the large ones) has the capital fund. If the government did not fund these projects, they would never happen. These projects include useful things like infrastructure, nuclear power plants, etc. Should the companies get more stake in these programs than they put in? I say no. Non-conservatives get pissed-off when conservatives talk about reducing government control, because that usually means getting rid of the controls that corporations don't like, but keeping the ones that they do(and adding more that they like, ie SOPA). I believe that the argument over big vs small government is destructive, and we should really be debating good intervention vs bad intervention.

  • Re:So when did... (Score:5, Insightful)

    by Lithdren ( 605362 ) on Tuesday January 24, 2012 @11:59AM (#38806085)
    I'd be fine with this point of view if we were activly paying other companies to then compete with AT&T with similar tax subsidized plans.

    Instead we have companies like AT&T activly sueing competition from even getting started, and doing everything in their power to maintain that power. Power they have because we granted them a monopoly to get things going.

    Long as they want to be the only game in town, they damn well better be beholden to the tax payer that put them there in the first place. To claim otherwise is Ludicrous!
  • Re:So when did... (Score:5, Insightful)

    by cpu6502 ( 1960974 ) on Tuesday January 24, 2012 @12:14PM (#38806307)

    The word you're looking for is not monopoly but cartel (companies colluding with one another to keep prices high). The record companies were prosecuted by the US DOJ for doing that with CD pricing.

    If you believe cellphone companies are guilty too of collusion, then maybe you should start building your case to prove it's true. Can you do that?

  • Re:So when did... (Score:5, Insightful)

    by spire3661 ( 1038968 ) on Tuesday January 24, 2012 @02:19PM (#38808313) Journal
    I shouldnt have to, that is the job of my government.

"What the scientists have in their briefcases is terrifying." -- Nikita Khrushchev