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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."
This story should have been declared "AT&T Declares war on customers". For reasons unknown, AT&T just doesn't grasp the idea of upgrading their network. So they provide shoddy service and blame their users instead. They do everything except take care of their network and their customers. Why do they insist on infrastructure upgrades as a last result? How can they grow when they can't handle what they have now?
They recently ranked dead last on a major US survey of cell phone providers for every single category. In all seriousness, what are they going to do when they are no longer the exclusive Jesus phone provider? People put up with for lack of an alternative network for their Jesus phone, without that exclusive they would start hemorrhaging customers.
Then : Use AT&T and download video and songs faster!
Now: Too many people are downloading video and songs!
When Fascism comes to America, it will call itself Anti-Fascism, and tell you to give up your guns.
Dear AT&T,
I could've sworn I remembered seeing something on my monthly iPhone bill... Ah, there it is.
" DATA PLAN IPHONE 12/02-01/01 30.00 30.00
Data Unlimited 12/02-01/01 0.00 0.00
Includes:
DATA ACCESS "
See, AT&T? It's right where you printed it. Unlimited data for a predetermined cost.
Now, AT&T, if you would please GTFO of here with this talk about billing me based on usage or prepare for me to take advantage of change in ToS so I can get out of my contract without penalty.
Best regards,
A guy who's looking forward to his contract ending so he can get an Android on a network that hopefully sucks less.
I use some 300-500mb a month of 3G data on my iphone.
The big question I have to ask if they charge per meg. can they block advertisers So I don't have to pay for things I don't want? Usage based billing will kill the web advertising business. As 30-40% of a web sites download size is images and flash related to advertising if I am paying per meg i am not dbouleing my bill just for crap I am not interested in.
i thought once I was found, but it was only a dream.
Dammit! Would you mind not actually using your phone the way we show you how to use it in our commercials!
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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.
"AT&T has found that only 3% of its smartphone users -- primarily iPhone owners -- are responsible for 40% of total data usage"
Or, put another way: AT&T has found that 97% of its smartphone users are not using anywhere close to the amount of bandwidth they are paying for.
As a result, they should have plenty of extra capacity and plenty of extra cash for network upgrades, right?
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'The first thing we need to do is educate customers about what represents a megabyte of data...
Excuse me, but aren't you the people who charge me for 1MB if I download 1byte?
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Here on Slashdot, we really like our car analogies; it's a long held tradition. However, for your benefit:
Say a pizza company comes up with a plan where you pay $300 per month for as many pizzas as you'd want with unlimited toppings. The company goes and advertises young people calling everyday to order a new variant of pizza, all smiling, happy, little pizza consumers. The advertising is effective, and the plan takes off; people everywhere are signing up for the $300 pizza deal. But instead of ordering Pizza the way the company wants/expected of 1 pizza a week (usually single pepperoni topping), college students actually order a fully loaded pizza every day. So now, the company is trying to tell people this small number of people are making it hard to do business because of a fringe group. In reality, the company is probably still doing well because the $300 covers the actual costs, plus they have all the people who aren't ordering pizza every day, but the profit margin just isn't enough. So now, some spokesperson is saying that in light of this fringe group, they might have to add a per pizza fee for each order on top of the $300/month.
I hope this helps and functions as a reasonable analogy of the problem.
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 doesn't. Cell networks are an entirely different animal. Comcast can add more bandwidth by allocating more channels on the cable plant to DOCSIS service and/or splitting your neighborhood into different coax nodes so fewer homes/businesses share the same bandwidth pool.
Wireless companies have a much harder time adding more channels. Spectrum licenses cost billions of dollars and oftentimes will come in an entirely different frequency plan that isn't compatible with existing devices (see T-Mobile's AWS purchase for a good example). Up to a certain point they can add more towers to make the footprint served by each tower smaller (analogous to Comcast splitting the node in your neighborhood) but this isn't always feasible. Community opposition and zoning requirements are often major stumbling blocks to building more cell sites. Interference from other cell sites is also a factor.
The wireless data network was never intended to be used for large sustained transfers. It was intended to be used for remote productivity, light web browsing and other intermittent uses. Some of the engineers I've talked to at Verizon are even honest enough to admit this. This whole problem could have been avoided if the carriers had been honest in their marketing when they were rolling out data services.
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We are the United States Government! We don't do that sort of thing.