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AT&T Should Be Investigated For 'Fraudulent' Data Policies, Says PK
zacharye writes "AT&T on Monday announced a new plan that will let developers pay for the data used by their apps and services. The data consumed by apps that make use of this new feature would not apply toward a user's data cap. The new service was pitched as a way for content providers to ease customers' growing concerns over wireless data usage, however one public interest group sees the feature as a slap in the face to AT&T subscribers. 'This new plan is unfortunate because it shows how fraudulent the AT&T data cap is, and calls into question the whole rationale of the data caps,' Harold Feld, legal director of Public Knowledge, said in a statement. 'Apparently it has nothing to do with network management. It's a tool to get more revenue from developers and customers.'"
I don't need to read more than "AT&T Investigated" in order to agree.
That is all.
Hang'em high.
So all the bandwidth everyone needs is actually there? The data caps were just a ruse to get more money for it.
Since people balked, even sued, AT&T now proposes that maybe developers could pay the difference.
That is telling. It means the bandwidth necessary for, say, Netflix never was a technical problem. It's just that AT&T looked at the fact that they are just a dumb pipe and AT&T wanted more money for valuable content traversing its network. It's the Net Neutrality problem all over again.
I'll see your senator, and I'll raise you two judges.
Your free market remark is a red herring.
We are talking about government granted monopolies to public spectrum. There is a limited amount of spectrum. It's not infinite. Government manages it in the public interest. AT&T is granted a license to use some spectrum in the public interest. They cannot just do anything they want with it and charge anything they can manage to swindle customers out of.
If AT&T were charging for access to read their opinions, then that would be a free market. I could just say no and go away. I could go elsewhere and read someone else's opinions for less, or for free. The difference is that there is an extremely limited number of wireless operators that effectively collude on price. Therefore it is important to regulate AT&T and prevent them from charging arbitrarily high prices that are completely unrelated to the cost + reasonable profit of delivering those services.
My response to complaints about the regulation of public utilities is this: If AT&T doesn't like it, then they could just get out of the business and let someone else take over their license to that valuable public spectrum.
I'll see your senator, and I'll raise you two judges.
I love how now that they have data caps, they STILL charge for tethering, even though they have no justification for doing so. I also love how if you put a smartphone on their network, they will add a data plan and charge you for it, even if you have data BLOCKED on your account.
I think that always proved the point this article is making. Once they came out with data caps, they should have made tethering free. It's not a case where you use more data because you tether something, just that you use it differently.
I've had numerous people ask me about getting a smartphone without a data plan, because they would be fine with only making calls/txts while out and about, but spend most of their time in the office/home/other wifi zones.
It's ridiculous that you can buy an iPad in wifi or wifi+3g, and data is optional, but you can't buy a "normal" phone with an ipod touch built in. There are plenty of people that would be fine only using wifi for everything besides calls and texts.
" 'Apparently it has nothing to do with network management. It's a tool to get more revenue from developers and customers.'"
To use a phrase, "Well, DUH!".
If you had looked in AT&T Wireless's annual reports for the past two years, they never indicated they were reaching any sort of limits on their network.
So either they were lying to their shareholders or to a gullible press and public.
Which is more likely?
You were mistaken. Which is odd, since memory shouldn't be a problem for you
"So for any given app you can either bill the dev a little bit, per installation or per use, or you can eat into the user's data plan."
The point is that AT&T said that the bandwidth was the scarce resource in their network and that caps were necessary to conserve that resource.
But as soon as a new revenue source was available, then the network was magically unconstrained. This is not "good idea", unless you're an AT&T shareholder, and then its magically a fantastic idea.
You were mistaken. Which is odd, since memory shouldn't be a problem for you
While I tend to believe that this is AT&T being corporate money-grabbing assholes, I have to disagree on the inference you made, that "we will allow the apps on our network if devs pay for bandwidth" implies "there is no capacity problem".
Charging for something is a way for regulating demand for a scarce supply of something. It's literally Econ 101, supply and demand. AT&T has to charge someone for the capacity used, such that the rates charged for it will regulate it. If there's a capacity problem, the rates go up. When the rates go up, demand goes down, and the capacity eventually reaches equilibrium based on price. It's how any producer sets the price of something in limited supply and high demand.
If demand is high enough for a sustained amount of time, then it's in AT&T's best interest to expand the production capacity (i.e. increase bandwidth available on their network), thus raising the supply. The marginal price goes down, but they are selling more total bandwidth, so their total revenue goes up. If they don't expand in a timely manner, a competitor comes in with better service for the same price, and all AT&T's customers leave and join the competitor.
In any case, you need to attach a price to the thing in limited supply so that it self-regulates. If no one pays for it, that's when there's a capacity problem.
If you want to argue about AT&T selling unlimited data plans that aren't really unlimited, that's one thing. You can also argue that bandwidth is not a true "physical" resource that takes cost to produce; once a certain capacity is in place, you shouldn't charge for usage. You can also argue that spectrum itself is scarce and the government grants a monopoly to these few companies, so competition is limited or nonexistent, and so they should be regulated. These are all fair arguments. But the general inference of "devs pay for bandwidth" => "no capacity problem" is fallacious.
At first glance, this seems like a good idea for the consumer, but for smaller, independent and boot-strapped developers (from whom most of the innovative products come) this is basically a nail in the coffin. The only reason the Internet is as innovative as it is now is because any Joe Schmoe with a great idea, some time on his hands and a deep willingness to learn can get his software into hands of millions of people and literally disrupt industries.
Allowing a company to pay for their users' data usage seems like a great idea for consumers, at least in terms of immediate monetary value. Google or Pandora can pay for my data usage and I can consume all I want.
The real problem is that this allows large, well-funded (and probably stagnant) software companies to completely crush smaller, less well-funded companies who have innovative or disruptive ideas. Who's to say You and I don't have a great idea together and want to compete with Pandora? Oh that's right, they have millions in investment capital and we only have time and development skills.
This is the same argument as allowing certain websites to pay extra for faster Internet speeds. Sounds like a great idea on paper, especially for consumers in the short-term, but in the long-term it will harm the entire industry in general by stifling creative innovators.
In the end, whoever has the most money wins.