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Why AT&T Should Dump the iPhone's Unlimited Data Plan
Pickens writes
"Farhad Manjoo has a provocative story at Slate asserting that while the iPhone has prompted millions of people to join AT&T, it has also hurt the company's image because all of those customers use their phones too much, and AT&T's network is getting crushed by the demand. The typical smartphone customer consumes about 40 to 80 megabytes of wireless capacity a month, while the typical iPhone customer uses 400 MB a month. As more people sign up, local cell towers get more congested, and your own phone performs worse. He says the problem is that a customer who uses 1 MB a month pays the same amount as someone who uses 1,000 MB, and the solution is tiered pricing. 'Of course, users would cry bloody murder at first,' writes Manjoo. 'I'd call on AT&T to create automatic tiers — everyone would start out on the $10/100 MB plan each month, and your price would go up automatically as your usage passes each 100 MB tier.' He says the key to implementing the policy is transparency, and that the iPhone should have an indicator like the battery bar that changes color as you pass each monthly tier. 'Some iPhone fans will argue that metered pricing would kill the magic of Apple's phone — that sense of liberation one feels at being able to access the Internet from anywhere, at any time. The trouble is, for many of us, AT&T's overcrowded network has already killed that sense, and now our usual dealings with Apple's phone are tinged with annoyance.'"
AT&T also scored lower than any other U.S. carrier in a recent customer-satisfaction survey—the first time it has ever claimed last place.
That's not the iPhone users fault: that's AT&T fault.
What's this horseshit of blaming the customer for shitting customer service, or service for that matter?!
They sold a service and an amount of bandwidth and now that they can't deliver, they're blaming the customer.
It's NOT me! It's the meds! I'm on 1000mg of Fukitol.
How would you handle the passenger texting then? The driver isn't the only one in the car.
APK likes to ask for responses to the same things over and over. Maybe he just likes the responses?
ATT offered users an unlimited data plan, no wait, they required one with an iPhone. Now the problems with ATT's network are the fault of those selfish users who took ATT's offer seriously. Give me a break. ATT is rolling in money from iPhone, they should use it to build out their network.
As a great man [allegedly] once said, 640kb should be enough for anyone.
Modern users with their demands for eight, sixteen and thirty two megabyte options are just needlessly draining the world's silicon supply so they can listen to a few songs. Traditional phone users who don't have all of those cutesy multimedia options can get by with a fraction of that.
Alternatively, time moves on. Just because 640kb was once enough for anyone, doing what they did with the limitations of that era, just because 40-80mb/month was once enough for anyone... That doesn't mean time doesn't move on and it doesn't mean it's appropriate to only support what once was the norm.
AT&T have made a metric assload of money from people who bought the iPhone for, well, being an iPhone and not "some other" smartphone. AT&T's network sucks, just about everyone seems to gripe about it. They suck it up, when they'd never have gone with AT&T in the first place, because it does come with a more able phone, because it does come with unlimited data access, because it does come with an interface that makes using 5-10x as much bandwidth as before a practical reality.
To play bait and switch, to get users to buy $600 phones (yes, I'll claim full price in a world where you either pay inflated monthly rates or a fee to cancel), to get them to sign up for those contracts, to get them to leave companies with more reliable service, all with the promise of an unlimited phone and then to say... yeah, we don't feel like paying to support that so, instead, surprise! we're capping the unlimited service we sold you and charging overage fees is obscene.
If AT&T can't really roll out coverage to support iPhone users using an iPhone as an iPhone... perhaps the real answer is for Apple to say, "OK, you can't meet your end of the agreement - we'll sell it to Sprint/Verizon/whoever instead."
AT&T entered in to an agreement with Apple to provide a network that supported Apple's product. AT&T entered into an agreement with the customers to provide a network to support that product in a certain way, too. If they'd like to acknowledge they can't honor that, I'm sure another company would like the opportunity.
Invest in more infrastructure is exactly what AT&T won't do if they move to tiered pricing.
As soon as extra money from the new fees rolls in their shareholders will start screaming that it belongs to them or the executives will just give themselves nice fat bonuses for implementing such a great new business model.
I don't know a good solution to this problem except for some serious competition to AT&T where their only possible response is to beef up their infrastructure to match or beat the competitor.
I like microcars
While the logic is sound, his basic premise is quite flawed. His article is based upon the idea that these "iPhone Users" are something so different and special from other phone users, that the world has never seen anything like them before (sounds like a bit of Apple propaganda to me). However, that is patently wrong. Just look at Japan. A very large percentage of the Japanese population uses their cell phones in ways that would put iPhone users to shame. That is not even mentioning that Japanese cities have much higher population densities than American cities, and you don't hear stories of how the Japanese phone network is falling apart. Between these two points, his conclusion that we will never be able to build enough network capacity to support iPhone users is clearly false.
source: http://www.companypay.com/executive/compensation/at-t-inc.asp?yr=2008
Total compensation of the five active execs listed for 2007 $59,359,833.00
Source: http://www.celltowerinfo.com/faq-4.htm
cost to build a tower $100,000 - $300,000
so I'll take 200k as an average
source: http://www.google.com/search?hl=en&source=hp&q=59359833%2F200000&aq=f&oq=&aqi=
number of towers that builds if they take NO PAY AT ALL- 296.799
source: http://en.wikipedia.org/wiki/United_states_of_america
surface area of the US 3,794,066 sq mi
source: http://en.wikipedia.org/wiki/Cell_site
range of a cell tower gsm 25miles otherwise 30-45 miles..
lets say 40 miles-- be generous
source http://www.onlineconversion.com/shape_area_circle.htm
area of a circle using 45 as the radius= 6361 miles
http://www.google.com/search?hl=en&q=6361%2F3794066&aq=f&oq=&aqi= .00167656546
6361 into the size of the USA
you've taken away 100% of their compensation, and added 1/10 of one percent of the towers needed to blanket the nation
every day http://en.wikipedia.org/wiki/Special:Random
iPhone is just the most visible because
It's the most visible because it's the only one that gets advertised by the media. I mean seriously - I used to joke about daily Iphone stories, but today we have, what, at least three on the front page? Where's the coverage for the big names like Nokia? Of course it's the most visible - but sales figures show a different story. And a good thing too, as I for one don't want the future of mobile computing to be a monopoly like we ended up with Microsoft, but worse one that's locked down to the extent that you can't even release an application without Apple approval.
Personally I'd much rather to see a future that continues with multiple companies (of which Apple can be one), with choice, and most importantly, compatible standards so that I can release an application that Just Works on all phones, without needing me to recompile it especially for each make, or getting corporate approval from the companies. I don't see why this is so controversial - and why Slashdot of all places is supporting the Iphone all the way.
Once upon a time, this was a place to support open and alternative solutions, not to give coverage and free advertising solely to large companies with locked down products!
Note that all phones can run so called "apps". Running applications on phones has been common on all but the most basic phones for at least 5 years, and note that the market of Java smartphones is estimated at two billion.
I'm not a hater. That's just another deceitful trick put out: that if someone uses another phone, disagrees that the Iphone is the best phone ever - or disputes claims that the Iphone is the best selling phone out there - they must be doing so out of an irrational hatred (e.g., the story about Japan hating Iphones).
By all means let's have a sensible debate about which phone is the best, or argue about how many phones are sold by which company. But please, let's have a fair debate, with evidence - rather than resorting to the usual tactic of branding people "haters", or modding people down out of sight simply because you disagree with them, and can't respond to their criticisms.
You're ignoring population density- the vast vast majority of iphone users are urban. Blanket those 300ish towers in the op 20 metropolitan areas and your problem is 99% solved.
I still have more fans than freaks. WTF is wrong with you people?
Your math is totally off.
3,794,066 sq mi / (6361 sq mi / tower) = 596 towers
596 towers * 200,000 $/tower = $119,200,000
So the top five would have to go without pay for two years in order to theoretically blanket the US. Of course, since the coverage of a tower is roughly circular, and circles don't tesselate, you'd actually need a lot more than 600 towers. However, for the pay of the top five execs, you could build about 300 towers.
so at&t adds fake fees and deceptively labels them as government taxes?
You changed my wording, I said 'government tax' like fee. And yes, they do.
The exact wording on a bill was "Regulatory Cost Recovery Charge".
This is in addition to:
* Federal Universal Service Charge
* Texas Universal Service Charge
Keep in mind that these are separate from the actual tax section of the bill and are not counted in the total contract monthly charge, they are added on top of that.
do you think that might get them in a bit of trouble?
No it does not.
sheesh
Indeed.
3. Feds establish rate limits for services. Data access would not be unlimited, but rates should be limited to $.05 per megabyte. Voice access rates should be capped to $15 per 1000 minutes per line.
Data is not a commodity, data is a service
When I go and buy a jar of salsa, the manufacturer had to pay a specific amount of $ to manufacture that specific jar. If I do not buy it, he can keep it around and sell that jar to someone else tomorrow.
When I want to park in a parking space for an hour, however, the city does not have to pay someone $ to create an hour in which I could park. If I do not park there, then the city cannot keep around the hour I was going to buy and sell it to someone else.
In fact, if the city had magical parking meters that would safetly and immediately eject the car of any non-paying person immediately as soon as someone with a quarter wanted to park, the city could just let non-payers park there as much as they wanted, with the understanding their car might not be at the same location when they got back.
The city would be foolish not to do this, as the parking meter is just there to make sure that someone going to the store on that street (say, to buy a jar of salsa) can find someplace to park. While magical parking meters don't exist, this IS how bandwidth works on the internet.
Unless your ISP is a drooling moron, they are NOT paying per-kb, per-mb, or any real per-use fee at all. They signed an agreement with backbone providers to get a certain amount of bandwidth for a certain amount of time, and they don't pay any more for bandwidth on an hour when NO ONE uses their network than they do for the busiest hour of their year.
If AT&T really wants to keep bandwidth responsive, they want to decrease the effect that heavy users have on their network. The cheap way is to just lie and charge those heavy users more -- but that's not the right way. The right way would be to set a self-tiering structure, where so much network activity over so long just puts a heavy user's requests at a lower priority than the lighter user who pays the same amount.
Letting heavy users voluntarily pay more to get faster service would be a great revenue model, too. Especially since it wouldn't be in danger of the FCC declaring it unlawful.
Sprint has the Pre and Hero and it's damn near impossible to spend more than $70/mo. That gets you unlimited mobile calls, data, text, gps, tv. The only way to spend more is if you spend more than 450 minutes a month calling landlines before 7pm. AT&T's base iPhone plan is $70 with no texts, favorite numbers, or gps, and the free nights start at 9pm.
I find it amazing that, in a system without data usage limits, 400MB is considered heavy. I work in an Optus shop in Australia, and we sell several different iPhone contracts, the highest of which comes with 2GB of data, and you can pin on another 1GB as an extra cost; I have seen people come into the shop to pay bills where they have exceeded the 3GB, month after month. I know this is just anecdotal, but it would suggest that usage limits encourage people to use all of what they pay for, and then some. Imposing limits on a previously limitless system, apart from angering customers, may actually increase traffic.
Admit it. You post strawman arguments as AC so you get modded Insightful for refuting them, rather than Troll
Your solution of investing in the infrastructure is completely correct, but is a completely alien concept in modern business practices. Investment is a cost, and so by not investing you're cutting cost and maintaining profit.
AT&T's behavior is endemic in American business today, and has been for god, 20 - 30 years? The US frequently comes in near the bottom, and all too often, dead last when its infrastructure is compared to the other industrialized nations. If you just compare the modernized coast of China, it's infrastructure is better than the United States. Our broadband is horribly slow. Our cell phone system is antiquated and undeveloped. Our electrical system is overstretched and prone to brownouts. Since everyone else can't be "ahead of the curve," we're left with the unescapable conclusion, that we're behind it. We're way behind it when emerging economies are on par with us.
It's not just infrastructure. The auto makers are in collapse (with the notable exception of Ford) not only due to crushing healthcare costs due to retirees, but also because the lack of will to adapt to new trends and technologies. It's embarrassing that after getting their lunch ate by the Japanese back in the 70s when Detroit was turning out crap (in all fairness, American cars today very well made, and can compete in quality with anyone), that they let it happen again by placing all their eggs in the SUV basket while not just ignoring, but actively fighting fuel efficiency standards and slow walking the development of hybrids and all-electrics. Guess who owns that market now?
With electricity, we're told that our infrastructure doesn't suck, but yet a fucking squirrel can cut off 50 million people. Meanwhile we're told to deregulate to decrease costs, but instead we get market manipulation that actually increases costs. (It seems like we always forget why the regulation was put in place the first time, and then we have to repeated learn that companies will screw over the most people in worst possible way, thus harming all of us, all to increase profits.) Then when we do say that we're going to invest in a new electrical infrastructure, and do develop new technologies, we don't. The US is already lagging the world in green technology development.
We make nothing here, except except "exotic financial instruments," and we know how well those work. Yet, people wonder why this is is the second jobless "recovery" in a row. Real unemployment is at 17%, but hey, the Dow Jones Industrials have been on a steady rise since March, so everything is cool. Wages are down, unless you're to top 1%. The Chicago Fed reported that the US has the most unequal wealth distribution of any OCED country. We have government that won't pass reform that 65% of the public wants, because it would hurt the megacorp that bought politician.
We've been asleep at the switch for too damn long, and now we're over the cliff.
When Obama came in and was talking about reform, and infrastructure investment, and new technology investment, I thinking that it was about damn time. Yet, we're not getting it. Instead we get "too big to fail." None of these promises are playing out like he said, because the entrenched interests, and yet you can't vote for the Republicans, because they simply deny there's a problem.
Goddamn we suck.