New iPhone data plans
June 2nd, 2010, 1:22pm by JakeSo the news today is that AT&T is changing the pricing on their data plans. Prices will drop from $30 to $25, but set a 2GB limit ($10/GB thereafter). And they’re also introducing a low-price, $15/month plan for 200MB or less. Not a bad deal on the high end, although unfortunate for heavy data users. But obviously that’s the point, to discourage heavy data use.
What I’m curious about is how this affects their subsidy pricing. Opting for a $15/month plan instead of a $30/month plan is $360 less over the life of the phone. Can AT&T continue their heavy iPhone subsidies? And given that data revenues will likely fall, does this indicate that AT&T has decided to minimize spending on network upgrades? I get the sense that there’s another shoe about to drop.
Data caps have been introduced sporadically in the broadband world, but often with ridiculously low limits such as 5GB for DSL. At what point do data caps affect you?
June 2nd, 2010 at 2:22 pm
A 2 GB cap certainly affects Mike (and would affect me and Jake every so often). AT&T’s actual press release implies that these are 2 options in addition to the $30 unlimited plan. That said, lots of people would switch to save the $5-15 dollars. Additionally, I bet there are a LOT of people that want iPhones who don’t have any need for data whatsoever, so for them, $15/mo is a lot easier to swallow than $30. I’m sure my mother-in-law will be switching, for instance (I’ll have to review her bill to see if she exceeds 200mb, but I don’t see how she could). Steph certainly keeps it under 200MB a month. This will definitely help with smartphone penetration into the midtier (and therefore might even boost Pixi sales 🙂 ). In that respect, the economics of subsidy recoupment does change substantially.
June 2nd, 2010 at 6:14 pm
As Kelvin said, it will definitely affect me, but much less once Simplify Media stops working (assuming I don’t get something else in its place soon). And it’s not soccer season anymore…
It sounds like I’m set through the end of my contract (in over a year), and as long as my contract doesn’t lapse, it sounds like I’ll be able to keep the unlimited plan. From TUAW:
Furthermore, on that same page (as well as on AT&T’s Facebook page, it sounds clear that you can grandfather your existing plan when you buy a new iPhone (even a new one). However, Ars Technica says, “Those that are currently on a two-year contract for a $30 per month unlimited data plan can continue to use it, and can even renew their contract and keep the same data plan as long as they continue to use the same device.” So sounds like it’s still a little unclear, at least to some.
So, is the new plan actually cheaper? Here’s how The Apple Blog analyzed it:
Overall, for me, it stinks — I can’t help but think that this is what Steve was referring to yesterday when he said that he thought that AT&T’s 3G woes would get better by the end of summer. And I don’t think that there are too many people who have been shying from the iPhone/AT&T juggernaut because of the price — there aren’t too many cheaper options out there, and sales of iPhones are, of course, phenomenal. Guess this is how AT&T thinks they’ll address Android competition, and most users won’t notice.
Like Jake said, I think this is squarely aimed at reducing data usage, probably because AT&T doesn’t want to add capacity to its network. It would be nice to think that they’re going to build out 4G instead of adding 3G capacity, but I’m not hopeful.
June 2nd, 2010 at 6:42 pm
Of course there are cheaper options out there– phones that don’t require a data plan. I think that’s what this lower tier pricing is aimed at. There are plenty of kids these days using feature phones with just texting plans simply because parents don’t want to pay $30/mo for an unlimted data plan. An iPhone with a lower data cost might be attractive. Sure they wouldn’t be able to use it the way we use it, but they could sideload music, video, games, etc, plus use it for texting… I can see how it would be worth $15 but not $30.
Anyway, the cost per GB allotted is certainly not as relevant as the cost per GB used, and for most (98%) iPhone users, this will amount to a price drop. The rest of you will probably be shrewd enough to keep your unlimited plans for the long haul, so the benefit to AT&T’s capacity will be minimal.
I have a bigger beef with the $20/mo tethering charge. You are already paying for 2GB, so what do they care how you use that 2GB? With the streaming video capabilities of the typical smartphone, there’s no reason to think that a PC is any more bandwidth intensive than a phone.
June 4th, 2010 at 3:12 pm
So the $30/mo plan is a grandfather situation rather than a continuing offering. No big deal as long as you are under contract for an iPhone, but the real bait-and-switch is the iPad 3G, which was sold with the promise of a $30/mo contract-free option. Current users can still get it, but I presume they won’t have it available on a month-by-month basis (ie, you have to keep it on if you want it keep it indefinitely). And the inability to wifi-share the iPhone’s data connection to an iPad is just silly.
June 12th, 2010 at 7:05 am
All told, I think I’d rather have a cap than have the throttle my speed, as apparently Sprint may be planning as early as this summer. Sucks if you just jumped ship from any carrier based on 4G less than a month ago.
Face it, all these guy suck.
June 13th, 2010 at 9:31 pm
Yeah, throttling would suck, because it’s not like Sprint’s WIMAX has been blowing anyone away with it’s speed as it is. Sounds like at best, it’s maybe 2X as fast as 3G in real world testing.
June 18th, 2010 at 10:21 am
Let me get this straight. AT&T’s coverage is not good, so they roll out these microcells, which you can buy with your own money and attach to your broadband internet (which you also pay for) to make the phone useable in areas where coverage sucks.
But now, if you use your data connection on your phone through your microcell (i.e., NOT through AT&T’s cell network, but via a local 3G connection to your microcell), it counts against your newly-imposed data cap!
There may be some technical reasons why it’s not as simple as I make it sound, but there’s got to be a way for AT&T to count the data on their end (that is, how much data their network is carrying, again emphasizing that the microcell/broadband is not their network) versus by how much data the phone is sending.
AT&T is pretty f-ed up on their pricing these days.
June 18th, 2010 at 12:17 pm
So ridiculous it’s gotta be a mistake. They probably never even considered that situation because almost anyone who’d have a microcell hooked up to their broadband backhaul would also have a wireless network they’re already using for their iPhone. You are a unique situation in that you are TOO unwired 🙂
June 18th, 2010 at 2:05 pm
Not that it’s too surprising, but here comes Verizon with rumors of tiered pricing. Not worth getting upset about, it’s inevitable. But it could certainly be a factor for AT&T iPhone customers who are grandfathered into unlimited data plans if they had to give that up for a tiered plan if they switched to VZ.