AT&T Learns Exactly The Wrong Thing About Data Usage

AT&T says that 65% of its users use less 200 megabytes per month; a whopping 98% use less than 2 gigabytes. (NYT) AT&T looked at these numbers and concluded it was time for tiered pricing; time to soak these “data pigs”.

I am a data pig. I average between 1.5 and 2 gigabytes a month over the last 6 months. AT&T hates me, apparently, though they are happy to take my money.

The prices are reasonable I guess;  $15/month for up to 200 megs and $25/month for up to 2GB. I would take issue with the AT&T guy who is kind enough to characterize 2GB as a “stupefying” amount of data, but that would be pointless. (The extra charge to tether, which comes with no extra bandwidth however — that’s just mean.)

So tiered data pricing is great, right? Tailoring costs to usage? How awesome!

Except, except, except.

There’s just one little thing: tuning your pricing to reflect iPhone users who only consume 200M of data per month is an answer to the wrong question. Rather than ask what is the lowest point they could cheaply cap data and still make money, they should have asked: Why are so many people using so little bandwidth? Or, put another way, you should be ashamed of yourself if you sell a device like the iPhone and then encourage people use it so lightly that they only consume a couple hundred megs of data a month.

Really, AT&T (and Apple, hello!) should be dying to get people to use 1-2 gigabytes of data a month at least. The more data people use the more entrenched the phone becomes in their lives. People (like me) who stream tons of audio, randomly play online games, wish to tether, etc., are the folks that rely on the phone and blend it into our everyday lives. If you are a subscription-based service company (AT&T) or a consumer electronics company who releases new devices yearly (Apple), isn’t that kind of lifestyle integration what you want? Doesn’t that keep people upgrading phones and extending contracts? Isn’t that how you get a customer for life?

Mobile data usage exploded over the last three years, and with the iPad and coming Android tablets, mobile usage was poised to explode some more. Now, well, we’ll see.  One of the great niceties of the iPhone was that you could just be unconcerned about your usage; just upgrade your apps, download your podcasts, stream your Pandora. Don’t Worry, Be Happy!

All gone. (You can bet the other carriers will follow suit as fast as they can.) Sucks to be a developer of a bandwidth intensive app, doesn’t it?

How about that Mr. Jobs, building devices that live by their effortless connectivity, knowing AT&T was going to cripple it? Had to feel good. How annoyed is Google, given the heavy usage of bandwidth intensive apps like Google Maps and Google Earth in the mobile space?

A buddy of mine commented that he was worried his wife would be listening to Pandora on her 3G iPad, mute it, and then forget and leaves the room, only to return the next day. Yeah, with AT&T’s network such connection reliability is unlikely, but still, the charges would pile up.

You do have to wonder what the Apple team is home thinking. They spend three years rewriting the rules for mobile devices only to have their exclusive carrier essentially say “We want your customers’ money, but we’d really rather they not actually use your product!”. Has to really suck to see the iPhone/iPad so hobbled by AT&T. On the other hand, given Apple’s clout with AT&T, they are at least a bit complicit, I would think.

And in the end, the tiered pricing model is bad answer to the wrong problem. It is not a problem if I use 20 gigs of bandwidth in a day, if I am the only one using my local cell tower. It is a problem if I use 100 megabytes of bandwidth in a day, if I am sharing a Manhattan tower with thousands. How does that truism relate to an overall tiered data plan? It doesn’t.

Each cell tower has a fixed bandwidth capacity, voice and data. Parcel it out so no one user can hog it. If your tower can handle 100 megabits/sec (ha!) then design for it to be maxed out, all the time, ensuring fairness. Don’t tell me about back-haul problems; that is your poor planning. But don’t charge me extra because I am using a particular cell tower at half its capacity; that’s just mean. Again.

And yes I know the wireless protocols are not super-amenable to this sort of thing, the way a wired router or switch might be, but that is again just your poor engineering. Fix it already.

I’d be less annoyed by this if the data caps were forward leaning; say $15/month for up to 1GB/month and $25/month for up to 5GB/month, but AT&T clearly really truly actually believes that 200MB/month is going to be sufficient for the majority of their customers for at least two years! Gah.

Doesn’t that just grind cloud-mobile, gaming-mobile, video-mobile, and some-really-cool-but-currently-unknown-mobile development to a halt?

Great job, AT&T: you just devalued your own product.

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96 Comments on “AT&T Learns Exactly The Wrong Thing About Data Usage”

  1. spellingnazi Says:

    “Tayloring costs to usage?” -> Tailoring

  2. Randy Says:

    AT&T loses exclusivity in 2012, so this is the last phone they’ll get from Apple. They don’t care about pissing off Steve-O. In fact, they’re betting that these last two years will pay for the previous six years of loss.

    • designbygravity Says:

      Yeah, probably, but it just seems like such an awful decision on their part I can’t quite understand it. I mean, they do need to try and grow the business past te next two years, right? They are in business for the long haul, aren’t they?

      Bizarre. They may not care about pissing off Steve Jobs, but Steve Jobs should care about AT&T pissing on his products.


      • Companies are run by executives, and the lifetime of an executive is typically around 5 years. Chances are that the people who made this decision don’t expect to hang around past the next two years, so they’re gonna make decisions that maximise profit during this time, without regard for what happens after that.

  3. justin Says:

    I don’t think it’s AT&T’s problem or care that people use less than 200mb/mo. Why should they? I don’t use that much, at least over the cellular network. Some of us just check email, the weather, or an occasional webpage on our phones.

  4. Levi Says:

    Frankly, I was shocked that iPhone users as a group use so little data! On the Android platform (Verizon network), Google’s Listen podcatcher app (with a couple of daily NPR shows) throws me over the 200MB limit in ONE DAY. I am deeply concerned that the trend to limit bandwidth and put off network expansion by the carriers will stifle the entire mobile revolution. And I’m not even talking about the iPhone and tethering yet…

    • designbygravity Says:

      Yes! I cannot imagine how people get by with so little bandwidth — don’t they use the damn thing? If I’m a carrier and I have customers who own a smartphone and use only 100M of data a month, I’d be worried they are likely to abandon it.

      • Morgan Says:

        Greetings,
        I use between 100 and 400MB/month, but that’s because I’m almost always in a wireless hotspot. I beat the _crap_ out of my home network, sometimes. 🙂

        I watch YouTube, download apps, install movies and Peepcode tutorials from home. It’s not on purpose, it’s just where I am when I spend the majority of my time online.

        So yeah…there are probably a LOT of us who use our phones just as heavily, but generally are on 802.11, thus it doesn’t show up on our bills.

        — Morgan

      • Morgan Says:

        Just to clarify; I’m not defending AT&T here, just answering your question, ‘I cannot imagine how people get by with so little bandwidth — don’t they use the damn thing?’

    • Ryan L. Says:

      I have to agree with you here. I usually use about 150mb a day with my android. I am thinking maybe because android at this point has been bought by techier consumers and therefore they know how to use the capabilities of the phone whereas the iPhone was a meme in the culture and brought by many people who just don’t understand how or what the phone can actually do. A personal example is my uncle who has an iPhone and really only uses it for phone calls and struggles with getting his email(he see he has a message and goes to the computer to read it) No matter how many times I show him cool stuff he will not integrate the phone into his life. I don’t know if this is a good example or not but I am sure it happens quite a bit. The tiering model for data is catering to the less educated on the use of these product and as you said the less willing to stick with them for a life time. P.S. Great Article

  5. Shteve Says:

    It sucks but welcome to the rest of the world. $80/month in New Zealand for phone connection and 1 Gig 😦


    • Hm… sounds quite expensive to me. Got any other opinions? In Germany are 9-10 huge companies with serious flatlines and many budget ones for cheap money…
      Good luck!


  6. […] AT&T Learns Exactly The Wrong Thing About Data Usage « Design By Gravity […]


  7. […] full post on Hacker News If you enjoyed this article, please consider sharing it! Tagged with: ABOUT […]

  8. Steve Says:

    Came from techmeme. This is exactly what I’ve thought about the data plan changes at ATT but haven’t been able to articulate it. Well said! I live in a wifi blanket and don’t use much data, but I have a t-mobile nexus one off contract, so I know I can cancel my data if i have to, or if i want to save some money.

  9. Fesja Says:

    In spain movistar-o2 sells right now ilimited traffic for 15€, first 200 mb at high speed. The rest at 64 kbps. So you can connect to the internet even when you have completed your monthly limit. And for 25€ a limit of 1gb.

  10. abhiroopb Says:

    Interesting article.

    I’m in Singapore and have 12gb of data so it hardly applies to me, but for the average joe I think you miss the point.

    Firstly, the things that eat up data is audio (podcasts, music, etc.) and video (netflix, youtube, etc.). So, long as you don’t download massive attachments, emailing and browsing the web takes up a miniscule amount of data.

    I generally use about 2-3gb a month. However, in a busy month where I didn’t watch too many youtube videos or podcasts, I only used about 500mb (mainly e-mails and rss feeds).

    The average user ONLY uses email.

    Take my mum for example, she bought all the hype and got an iPhone. My dad and I really don’t understand why. She’s at home most of the day and so she can just use the laptop. But, anyway on the iPhone she checks her e-mail, occasionaly goes online and has about 10 apps in total. Her total data usage: 155mb.

    You could say that people aren’t using their devices to its full potential, but I think it is similar to buying a powerful laptop/desktop and then using it for email and word processing (as 90% of the computer population do).

    The analogy of why a netbook became so popular can be applied here. People don’t need so much data. People don’t need so much bandwidth. A recent study showed that although people don’t know what their speeds are they are happy with it. Why? So, long as a web page opens up and a youtube video buffers it is irrelevant whether you have a 1mb/s connection or a 100mb/s connection.

    I personally play online games a lot and I like having a 100mb/s connection, but my parents don’t need it to surf the web and use email.

    As consumers we all fall for the “SUV effect”, we want the best of everything even though we don’t use it.

    • Wade Hammes Says:

      well said. I am not on AT&T yet, but I just graduated college, I am in the web design and online social media/digital marketing field, and I am about to get my very first job and love the new iPhone (so long mom and dads phone plan!).

      I use my phone now (blackberry storm 2 on Verizon) mainly for email and occasional app usage (heavy twitter and foursquare usage, moderate to little browsing, just because the browser sucks).

      I cannot see myself using more than the allotted 2gb data usage limit per month. Even if I do, it will cost me $10 more per gig after that. That will never happen.

      Do I agree with anything AT&T does with its plans? NO, not at all. I am finicky to get an Android device right now due to the fragmentation of the market. The iPhone has its set ways, I am okay with that.

      I am, however, weary to the restrictions AT&T hold over the iPhone and other smartphones at this time. It is like a lowlife friend who is begging you to stick around just to hold you back.

      I love the iPhone. I do not hate/love AT&T. I love Verizon and Sprint. Let’s get a commonality amongst the carriers. IN this case, competition does not breed the best results, especially when some carriers offer better plans/lack any service OR exceptional plans/not the best phones.

      Sooner or later there is a crossroads that has to be met!


  11. […] spot-on analysis of AT&T’s new data pricing plans, from Christopher Schanck. In summary: by looking at […]

  12. PeterI Says:

    Currently here in the UK from t-mobile I have a deal where my initial data connection for the phone comes with a 1GB limit for data transfer cost – $10

    In addition I spring for tethering which boosts the limit to 3GB and an increase in speed to HSDPA cost – $5

    There is also a 10GB limit version that costs $23.

    Interestingly is that all of these limits are soft, there is no mechanism to charge me if exceed the limits (although there seems to be a presumption that they’ll phone you if regularly bust the limit)

    Also I don’t think that tethering is explicitly disabled on the lowest service tier, it’s just a T&C violation.

    For me the limit being soft is a big win, most months I won’t go anywhere near 3GB of data. Occasionally if I’m doing a run of customer visits where I’m staying in hotels I might get close but so far it’s never happened. (BTW dollar amounts are VERY approximate)

  13. Apreche Says:

    The phone is entrenched in my life, but when I checked my usage, I used less than 200MB most months. There are a few months when I went over, which makes the decision difficult. When I get the iPhone4 I’ll probably get the larger plan with tethering. I imagine I’ll be uploading a lot more videos thanks to iMovie, and tethering will increase usage as well.

    I think I’m just using wifi a lot more than you.

    • designbygravity Says:

      You’re using wifi a lot more; that’s great for you.

      Are you happy that AT&T takes this as a sign that they don’t need to increase their network capacity in the future?

  14. yock Says:

    Those who use much less data bandwidth than you should not subsidize your usage. This isn’t about discouraging usage, it’s about makeing your usage profitable to them and charging what the market will bear. They’re betting that you’ll pay for the plan with the higher limit and subsequently pay-by-rate for usage over the plan. I’m betting they’re right.

    • designbygravity Says:

      I might pay for it; I might not. I’ll be leaving AT&T at the end of the year regardless. So people who use less bandwidth shouldn’t subsidize people who use more?

      People who push the envelope on this are the folks that enable new applications to be developed, because they are the ones who use them first.

      It was people (not many at the time) with good broadband that enabled YouTube to happen; they were data pigs of their time. But because they integrated YouTube into their life, they dragged video-over-internet into the mainstream.

      In a sense, people who use the the Internet more are subsidizing those who use it less, in terms of pushing the state of the art forward for all.

  15. Tom Says:

    I’m confused. You’re upset because the cost of the plan you would use went down by $5 a month (the old unlimited plan at $30, 2GB at $25)?

    It’s not that AT&T is mean, using your scenario. Capitalism is mean. Providing bandwidth costs money.

    • designbygravity Says:

      “Providing bandwidth costs money” — yes it does, but the cost is unrelated to the average usage by customer. It only costs money relative to a specific cell tower; global pricing like this is, IMHO, a farce.

      • Tom Says:

        I don’t buy your argument. Your plan would have your rate set (or bandwidth throttled) by how much your neighbors used the system, which doesn’t sound like a viable plan to me. AFAIK nobody is set up to monitor and bill for that system. And cost is related to average use by customer; more use means more infrastructure is required. To state otherwise is fantasy.

        You seem to be complaining that your favorite steakhouse doesn’t have an all-you-can-eat buffet so that you can get unlimited filet mignon for $9.99. That’s not a farce, that’s basic economics.

        • designbygravity Says:

          I didn’t really say I had a “plan” per se; but I do think the comfort of reasonably “unlimited” data is what has driven the mobile growth of the last 3 years.

          I would say I don’t want my *rate* set by my neighbor’s usage — I want my local performance reflective of my neighbor’s usage. Because, in fact, it already is. No matter what data plan I pat for, my access will be bound by the closest tower’s capacity vs. the tower’s usage. Doesn’t matter what I pay for. It is a question of AT&T’s network provisioning.

  16. John Says:

    So you think AT&T “hates you” because they are changing their rates to lower your bill by $5/month? You are circling around a point here, but it’s a bit lost in the histrionics. The problem is that a small number of extreme data users (a level that’s well above 2 GB, judge by their overage pricing) are very expensive to support.

    Paying for what you use is not a bad thing, and I am pleasantly surprised by how well AT&T has priced both the tiers and the overage rates. I expect we’ll see other carriers following suit.

    • designbygravity Says:

      If the problem users are well above 2GB (which I am not), then we not put the top tier at 4GB to be forward looking? They seem to have cut it so fine that ether a) in a year the look like goobers and have to change the plan caps or b) it brings interesting mobile development to a halt for a good chunk of time.

      This is, to my way of thinking, similar to the stupidity that keep land-line broadband asymmetric; they’ve made upload speeds such a low-ball in terms of performance that it is pretty accepted now.

  17. michael Says:

    My concern is that right now 2GB is a lot of data – but this time next year?

    I believe AT&T knows this and that is where they plan to make more money at our expense.

  18. Tucker Says:

    I am going by the assumption that Apple gets a percent of the Data usage cost from AT&T in return for exclusivity. AT&T is attempting to control the bandwidth usage because of how lacking it is. Less people consuming the faster and more available it will seem to users causing a false “improvement in service”.

    Apple could probably care less because they are getting their percent and when people start going over the 2GB cap and have to pay an extra $5 over the “unlimited” plan from before they will get a little bit more as well.

    AT&T didn’t make this decision without Apple IMO. Steve Jobs is too much of a control freak to allow this. IMO Apple is not clean in this. Not by a long shot.

  19. Captain Coconut Says:

    Increasingly users consider, unlike 20 years ago, an internet supply either via towers or cable or whatever as a utility in the same premise like electricity or gas. With other utility companies, their pricing fits more around using in time (electricity is cheaper during off-peak, for example), or just a solid price. They don’t care too much if you use top 1% of all households or not, they just care about you paying the bill and not harming the network that offers the service.

    Mobile internet providers work completely differently, as very little of them in western Europe and North America charge in units of time or data consumption under contract. They essentially offer a service that they want to charge you for, but you to never use, and if you do use it, as sparingly as possible. If you don’t use it, you won’t complain that the bandwidth sucks, or it drops connection all the time – and you can just keep paying that money automatically with direct pay. When broadband really boomed out in many parts of Europe and the US, data usage wasn’t viewed as something similar to electricity consumption or water or gas consumption to each household with the service, rather just an assumption that they, the providers could run with the smallest amount of headroom on the network and to have the most amount of users possible. Average users don’t care about contention ratio on a connection and assume or expect carriers to have infrastructure to meet usage in areas accordingly.

    For years mobile carriers like AT&T have operated 3G services on the least amount of backhaul possible. The boom in smart phones and 3G/3.5G modems has messed their shit right up and users who’ve spent nearly a decade in some places having un-metered broadband internet in their homes don’t consider the idea of being charged per gigabyte for usage acceptable as cable channels who also sold their in home connections never charged per hour for their TV service (excluding pay per view) or for the internet connection. The said consumers will however happily pay per kilowatt-hour to supply the needed electricity to operate the connection in the first place.

    Who do you blame? Comcast, Virgin, Warner, BSkyB who’ve offered advertised “unmetered” broadband as part of triple play or double play services in the 5 years, consumers are expecting the pricing arrangements translate into the mobile sector. If my cable TV company gives me cheap calls and unmetered internet for X/month, my cell phone carrier can do the same, right?

  20. Eric Barrett Says:

    I wonder why Apple is still staying with AT&T. It has to be a kick in the teeth to cap data usage. I can’t see how limiting your device in any way helps Apple. Steve Jobs seemed pretty furious with Google for making a phone – I wonder how he feels about AT&T breaking the iPhone / iPad?

  21. sulfide Says:

    it doesnt matter because the macfanboy in you will continue to pay AT&T. So why should they care? what’s devalued..they are still going to make the same amount of $ or even more. They way they looked at it, they saw those companies making money and said “hey we;re the backbone to this money, we want to make more!” and hence forth the new plans were put in place.

    • designbygravity Says:

      “macfanboy” ha! I’m already on record as saying I am going to Android around Christmas; I pay AT&T because it offered the best capabilities at the time. But the 3GS is the last Apple phone I’ll buy on AT&T’s network, and probably the last Apple product I’ll buy period.

  22. Keleko Says:

    I use less than 100MB of data with my iPhone per month. My wife and I COMBINED use less than 200MB per month on our two iPhones. Shocking! How do we do it!?! I use my iPhone daily, too! Oh, I have WiFi. I use that the majority of the time. I hear it is faster than 3G, too. It’s evem more stable than AT&T’s network! Maybe you should try it sometime.

    Okay, I work from home, so I may use it more than you do. But WiFi hotspots are pretty common, too. It isn’t that difficult to find one.

    • designbygravity Says:

      With an hour commute 3X a week, lots of time spent using the phone when ferrying my kids to dance, lacrosse, etc., wifi is sadly rarely an answer. And your answer is sort of proof of my point; AT&T has you paying for 24X7 3G connectivity but your not using it. Good for them, yes?

  23. Lewis Salem Says:

    The people who cry “I only use XX amount!” aren’t thinking creatively. What happens when I want to share a video I just shot in HD of my kids across the 3G network on Apples new iPhone 4? All it takes is one killer app to blow the cap. As developers, if we think of limitations and caps, we won’t be as creative and therefore innovation is stifled.

  24. Steve 802 Says:

    In general, across all devices (except for the automobile and television, perhaps), people are small users; it’s that “long tail” distribution .. 20% of uses use 80% of capacity … Steve … P.s. Thanks to other commentors for their local ¥/Gbyte data! I’ve been wondering about that!!!

  25. Fang Says:

    “Why are so many people using so little bandwidth?”

    Because they don’t need it.

    “you should be ashamed of yourself if you sell a device like the iPhone and then encourage people use it so lightly that they only consume a couple hundred megs of data a month”

    Sure, and auto makers should be ashamed of themselves if people don’t consume more gasoline.

    There are other *real* bones to pick such as SMS/MMS pricing and tethering service charge, but I see nothing wrong with tiered data usage pricing. What is it about digital media that makes some people abandon common sense when it comes the evaluation of online services?

  26. Walter Elly Says:

    I share your passion and feelings over this issue. I hope I never have to know what limited bandwidth on iPhone is like, for now I’m holding on tightly to my grandfathered in unlimited plan.

  27. Mike Says:

    Not only that….

    I have two crappy phones on ATT, whom I had selected because I planned to buy an iPhone in the future. iPhone 4 looked to be that unit, but now, with these ridiculous data caps, I ain’t gonna do it. Sorry Apple. Love your stuff, but this just blows, and the deal is no longer worth it.

    Furthermore, once my existing two-year contract expires, it’s goodbye to ATT!

    Oh, well.

  28. Ric Says:

    IF this doesnt demonstrate a need to take the iPhone away from ATT nothing does! I am so looking forward to their Massive corporate losses when the iPhone goes elsewhere.


  29. […] AT&T Learns Exactly the Wrong Thing About Data Usage: The more data people use the more entrenched the phone becomes in their lives. People (like me) who stream tons of audio, randomly play online games, wish to tether, etc., are the folks that rely on the phone and blend it into our everyday lives. If you are a subscription-based service company (AT&T) or a consumer electronics company who releases new devices yearly (Apple), isn’t that kind of lifestyle integration what you want? Doesn’t that keep people upgrading phones and extending contracts? Isn’t that how you get a customer for life? […]


  30. […] out of this trend is an obvious thing for a publicly owned company to aim for. Meanwhile over at DesignByGravity, they've got a completely different counter-argument. While it's kinda understandable that AT&T's […]


  31. […] out of this trend is an obvious thing for a publicly owned company to aim for. Meanwhile over at DesignByGravity, they've got a completely different counter-argument. While it's kinda understandable that […]

  32. Chad Says:

    You heard of Sprint? Android? Seriously. If you’re that much of a free spirit, you shouldn’t be living in the confined spaces Apple creates for you anyway. Get an Evo and move on.

    Oh, and your data connection will actually work, too.

    • designbygravity Says:

      Oh I plan to — move on that is. I’m planning for a Nov-Dec leave-taking of AT&T & Apple. Not sure what will replace it, but I am certain Android devices will be even further along than the current crop by then.


  33. […] out of this trend is an obvious thing for a publicly owned company to aim for. Meanwhile over at DesignByGravity, they’ve got a completely different counter-argument. While it’s kinda understandable […]

  34. Narg Says:

    I think data capping stinks. But do think it’s good for lower prices. Kinda torn… Anyway, it should be $15 for 2 gig, and $25 for 5 gig with free tethering IMHO. AT&T is greedy, period.

    Cell data is the cheapest data on the planet. How? Becuase there is no “last mile copper” to support. That copper is expensive to support. Since there is none of that, cellular data is dirt cheap. AT&T is greedy, period.

  35. jeffpruett Says:

    I’m a IT director at a college. Some of my users demanded the iPhone and I know they’re using less than 200 megs a month.
    Buying a wireless device is just like buying a PC or a car. You look at your requirements first and buy what fits your need. Not what has the coolest flashing lights.
    I suspect a majority of folks buy these plans with no idea of what their actual needs are.
    Very good post, though.


  36. […] over at DesignByGravity, they’ve got a completely different counter-argument. While it’s kinda understandable […]


  37. […] I am a data pig. I average between 1.5 and 2 gigabytes a month over the last 6 months. AT&T hates me, apparently, though they are happy to take my money. – Design By Gravity […]


  38. […] AT&T Learns Exactly The Wrong Thing About Data Usage (via Design By Gravity) Posted: June 9, 2010 by AA in WordPress 0 AT&T says that 65% of its users use less 200 megabytes per month; a whopping 98% use less than 2 gigabytes. (NYT) AT&T looked at these numbers and concluded it was time for tiered pricing; time to soak these "data pigs". I am a data pig. I average between 1.5 and 2 gigabytes a month over the last 6 months. AT&T hates me, apparently, though they are happy to take my money. The prices are reasonable I guess;  $15/month for up to 200 meg … Read More […]

  39. anon Says:

    iPhone plans should be 100% Prepaid through iTunes.

    Buy in increments of $10, $20, $50, and $100. You get voice at 5 cents a minute and data at 1 cent per MB. Apple would mediate with carriers like it does the record companies. The customer should NEVAR interact with any carrier whatsoever.


  40. […] AT&T Learns Exactly The Wrong Thing About Data Usage AT&T says that 65% of its users use less 200 megabytes per month; a whopping 98% use less than 2 gigabytes. (NYT) AT&T […] […]

  41. Handsome Matt Says:

    That’s the problem isn’t it. If you parcel out bandwidth, suddenly it’s an issue of net neutrality. Or did you believe that had something to do with censorship…

    Secondly, you aren’t the only one using 20 gigabytes of transmission space a day. There are thousands like you. And despite what you may believe or your parents may have told you, some of them and the data they’re transmitting is significantly more important than you having the ability to listen to the Pandora… People like doctors, lawyers, Construction Foremen, engineers…

    Furthermore, iPad data usage is EXACTLY why they’re doing this. A few million more users downloading massive amounts of data onto an already strained network is going to have devastating effects. Especially combined with the recent transition to a purely digital broadcasting network.

    Lastly, towers route into the existing copper wire infrastructure. There isn’t a special iPhone only internet service, despite how elitist you think you are. So you’re 20 gigs of data now clogs up the hospitals, police offices, and business’ internet service as well.

    The network (that is to say, THE REST OF THE UNIVERSE)can’t handle a few thousand people around each tower using 20 gigs of data or more for what is effectively entertainment, oh what Karl Marx would say about this.

    • designbygravity Says:

      If you parcel out bandwidth in terms of actual capacity, then I as a customer can take my business elsewhere, to carrier with more capacity. Charging blanket tiered pricing disconnects my costs entirely from the capacity of the network.

      Yeah there are thousands like me. And we all got sold a certain capability and an entirely new business area has grown up around it.

      Take your “more important data” and stick in your ear; if you need that kinda bandwidth then buy it directly; there are wireless data plans for just such usage models.

      And there is no way my iPhone usage, even at 10GB a month, could approach 1% of the clogging being done by landline broadband connections using bit torrent. And, ah, they share the same wired backbone, don’t they?

      The “network” can handle it; FIOS and cable modem customers do this all the time. The cell towers can’t; fine. Slow down my access (and everyone else sold the same connectivity as me) so the tower (the scarce resource here) is shared appropriately. Add more towers if people are hamstrung, or watch people vote their feet and change carriers.

      Can’t get much more elitist than thinking someone else’s data is more important than mine.

      • Handsome Matt Says:

        So you’re whining then. Thanks for clearing that up, I thought this was a legitimate argument.

        Silly me

  42. antoeknee2 Says:

    HA! I Left at&t a while back. Reading your blog assures me i made the right choice 🙂

  43. alya gufar Says:

    Thanks for this AT&T info, Reading your article give me good information. Thanks alot.

  44. Jim S Says:

    All of you are missing a huge point here. What we are talking about is 3G bandwidth here. I am an iPhone user and blow through about 4GB a month. Am I worried??? Heck no because most of my usage is on wifi networks at home and where I travel.

    I find AT&T wifi hotspots in many, many places. When I look at my actual 3G usage it is a rather modest 275 mb on average for the last 6 months. I am a heavy user of data, but not a heavy user of the 3G network.

    When you compare the availability of wifi that is included with the at&t plan, it is simply more abundant than any of the other carriers.

    So why do this? If their stats are to be believed, this actually should lead to less revenue.

    According to Cisco, within 2 years 95% of web traffic will be driven by video and with the new video chat application, this tiered pricing makes sense.


  45. […] | Posted by Chill on 10 Jun 2010 at 01:54 am | AT&T learns exactly the wrong lesson about data usage. […]

  46. decidida74 Says:

    Very true. I am in the process of weighing my options and with the data rate stuff I am now considering to stick with my blackberry. A friend mentioned to me in April he used 11.5gb of data, three days into this cycle he was already above 200mb.

    What to do!

  47. Christian Says:

    The new smartphones, especially the iPhone 4.0, will be more data hungry because the hardware can support HD content and larger application files.


  48. […] your browser at “AT&T Learns Exactly The Wrong Thing About Data Usage.” Agree or disagree with the write up. What I noted was: AT&T says that 65% of its users use […]


  49. […] Read the rest of this post on the original site Tagged: Apple, Internet, Voices, media, mobile, AT&T, Christopher Schanck, Design By Gravity | permalink Sphere.Inline.search("", "http://voices.allthingsd.com/20100610/att-learns-exactly-the-wrong-thing-about-data-usage/"); « Previous Post ord=Math.random()*10000000000000000; document.write(''); […]


  50. […] ENJOY THE ARTICLE I REBLOGGED AND WROTE THESE COMMENTS ABOUT: AT&T says that 65% of its users use less 200 megabytes per month; a whopping 98% use less than 2 gigabytes. (NYT) AT&T looked at these numbers and concluded it was time for tiered pricing; time to soak these “data pigs”. I am a data pig. I average between 1.5 and 2 gigabytes a month over the last 6 months. AT&T hates me, apparently, though they are happy to take my money. The prices are reasonable I guess;  $15/month for up to 200 meg … Read More […]

  51. evie Says:

    What annoys me about the 2 GB limit is that it feels like they chose the exact number to make it painful for those who actually use their iPhone. If I stream a few hours of video in a month over 3G, my usage goes up to around 2.5 GB. If they wanted to cap extreme users, they’d have gone with a 5 GB max. Instead they are squeezing people who simply use the phone for more than email and light web surfing. I’m so annoyed that I’m now going to have to regularly check my usage. Feels like the old days where you had to monitor your cell (talking) minutes, or your “long distance” calls from a landline. AT&T is moving us backward.

  52. Pianotech Says:

    Quit your whining and pay your way. If you use more electricity, water, and gas than I do, you’ll pay accordingly, so it’s neither new nor a difficult concept to grasp. I use are around 500MB/month and that’s with gps going all day as well. I can’t stand this entitlement mentality that makes people feel they’re owed. Use 10 gigs if you want, just get your wallet out.


  53. I think there are two simple ideas behind AT&T’s new data plans:

    1) Whether we like it or not, the network is congested. AT&T doesn’t have a magic switch it can flip, and demand continues to outstrip the pace at which it can update old equipment, build out new towers, etc. With a faster iPhone and a multitasking OS, the iPhone’s ability to hammer the network even harder is compounded.

    Really, these new caps are an attempt to throttle that data usage a bit to slow things sown in the short term. Get people to be a little more conscious about their usage and hopefully clear up the congestion. It sucks, I’m a data hog too. But these new caps can’t stay this low forever, and from what I’ve been hearing at a couple of my AT&T sources, they really aren’t kidding when they say the network in major metro areas should get better in the next 6 months or so.

    Also, it’s worth pointing out that the majority of AT&T’s network problems are on major metro areas, and even then, mostly San Francisco and New York. If you look around, you’ll see comments from plenty of people who *don’t* live in those cities and are pretty happy with AT&T’s service.

    2) I think the value that these new plans offer to an entirely new set of users is being seriously overlooked. Bandwidth hogs are upset, but there are a ton of people out there who don’t need unlimited mobile Internet, but more importantly, can’t afford it. $15 is a helluva lot cheaper than $30, and I remember when I had to pay $50 in Denver (just for data!) in 2005 and 2006 for my BlackJack, and that was only 2G data to boot.

    Now, a ton of people who want iPhones but don’t need unlimited data can finally afford to join the rest of us. Maybe they use it mostly over WiFi, or maybe they just aren’t tech elite, but want a great phone experience. Whatever the reason, AT&T’s become the first carrier to offer super cheap data plans on smartphones to a ton of users who previously couldn’t afford them. That’s awesome.

  54. Tracie Barnes Says:

    I’ve had my iPhone for eighteen months and I use it a lot. My average data usage (<100MB/month) however would lead you to believe that I'm a light user – not even worthy of owing an iPhone. You neglect to recognize that there are more and more free WiFi hotspots within most cities which allow users like me to surf, watch videos etc., without increasing 3G data usage. We also have wireless in our home so I can do whatever I want without increasing my data usage.

    I'm excited to have the opportunity to start paying $15/month instead of $30 as I sure that I won't go over the 200MB limit.

    If you're going to condemn AT&T why don't you talk about the insane add-on charges for texting. I refuse to give them $20 per month for something that consumes virtually none of their bandwidth.

    • designbygravity Says:

      To be honest, I can’t bring myself to complain about texting costs because it so amazingly insane to even contemplate. That way lies madness.


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  56. i’ll give you the benefit of the doubt 😉

  57. Aziq Says:

    well done.nice post.


  58. Great article.. Keep it up!


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  61. Zentana Says:

    haha cool article,, ^^


  62. Great article! Thanks for writing..

  63. DiegoTwenty Says:

    at n t still the best. i have been used it for 3 yeas. and dont see any problem

  64. 3d tetris Says:

    good eye, great post. thank you.


  65. thanks for your usefull post,i allready bookmarked your blog and will come back for read future post
    keep share

  66. Randy Says:

    I love my iPhone I can never switch. It is the best device. Android sucks. I don’t know if I will switch to Verizon or what though.


  67. […] AT&T Learns Exactly The Wrong Thing About Data Usage « Design By Gravity Share this:ShareEmailPrintTwitterLinkedInLike this:LikeBe the first to like this post. This entry was posted in Link, Technology and tagged cellphones, data, mobile by cyberetto. Bookmark the permalink. […]


  68. […] AT&T Learns Exactly The Wrong Thing About Data Usage « Design By Gravity Or, put another way, you should be ashamed of yourself if you sell a device like the iPhone and then encourage people use it so lightly that they only consume a couple hundred megs of data a month. […]

  69. pen.io Says:

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