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AT&T Moves Closer To Usage-Based Fees For Data
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."
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?
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.
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Does this mean I can get out of my 2 year contract then? This is blatant false advertising and breach of contract. I did not get an iPhone to have stone-age metered internet access.
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.
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.
Out of modpoints but really liked a post? 1BDkF6TtmmeZ3yqXbz9yhdYVqRYnwFoXDj
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.
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.