AT&T considering curbing data usage?

[ASIAN JUL]

http://news.cnet.com/8301-30686_3-10412804-266.html

AT&T wants its iPhone users to use less wireless data, and it may consider new pricing models to curb users' data usage as it tries to keep up with growing demand.

At an investor conference in New York on Wednesday, Ralph de la Vega, AT&T's head of wireless, said the wireless operator is considering incentives to get consumers to reduce their data usage.

De la Vega said 3 percent of smartphone users are consuming 40 percent of the network capacity.

"We're going to try to focus on making sure we give incentives to those small percentages to either reduce or modify their usage so they don't crowd out the other customers in those same cell sites," said de la Vega according to a transcript of the conference. "And you'll see us address that more in detail."

He went on to say that most consumers aren't aware which applications use a lot of bandwidth and which do not. For example, email does not consume a lot of bandwidth, whereas streaming video and audio do consume a great deal of bandwidth.

"What's driving usage on the network and driving these high usage situations are things like video, or audio that keeps playing around the clock," he said, according to the transcript provided by AT&T. "And so we've got to get to those customers and have them recognize that they need to change their pattern, or there will be other things that they are going to have to do to reduce their usage."

AT&T has been struggling to keep up with demand for wireless-data usage on its network. The iPhone, launched more than two years ago, has revolutionized mobile Web usage. The device, which was built more for accessing the Net than making calls, can access more than 100,000 applications, many of which use the mobile Internet.

iPhone users on average consume five to seven times more data per month than average wireless subscribers, according to analyst firm Sanford Bernstein. And all this usage is clogging the network, causing many iPhone users, especially in large cities such as New York and San Francisco, to experience dropped calls, slow 3G service, and issues connecting to the network at all.

AT&T has been reluctant to admit that there is a problem, but recently, the company has acknowledged that problems exist. According to The Wall Street Journal, de la Vega admitted that New York and San Francisco have been experiencing service issues. And the company recently launched an iPhone application that allows users to report service problems.

AT&T has been upgrading its network to the next generation of 3G wireless service to increase network capacity. But now the company is saying it needs to actually curb usage in order to get a handle on demand.

De la Vega didn't provide specifics about how the company would actually get consumers to use less data. But he said that a usage-based pricing model may be considered in the future.

"I think longer-term, there's got to be some sort of a pricing scheme that addresses the usage," he said. "But that's going to be determined by industry competitive factors, regulatory factors and customer [successes]."

The idea is that usage based pricing may actually deter consumers from using high-bandwidth applications. Unlike voice service, which is already tiered, wireless-data service is charged at an all-you-can-eat flat rate. iPhone users select a voice plan, then pay an extra $30 a month for unlimited data usage. By contrast, AT&T has limited the amount of data that its wireless-data card users can consume each month to 5GB. After that limit has been reached, customers who use the AT&T network to access the Net from their laptops get charged more based on their usage.

But asking iPhone users and other smartphone subscribers to cut back on their data usage may be somewhat unrealistic, and it could actually stifle innovation and development of the mobile Internet.

AT&T seems to realize that this is not a long-term solution. And not only is the carrier upgrading its network, but it's also asking the Federal Communications Commission to find more spectrum to auction off that can be used for wireless-data services. Jim Cicconi, senior executive vice president of external and legislative affairs for AT&T, said in a separate interview with CNET on Wednesday that something needs to be done to deal with the flood of wireless-data traffic.

Cicconi and AT&T's CEO Randall Stephenson met with FCC staff members earlier this week to discuss the spectrum issue.

"Clearly, there is a looming crisis that needs to be addressed when it comes to spectrum availability," Cicconi said in an interview at his office in Washington, D.C. "Wireless-data usage is growing far faster than anyone had expected. And if we don't do something soon, we will run out very fast. And then we will have to start telling wireless customers that they can't do all the things they want to do with their devices."

FCC Chairman Julius Genachowski has made freeing up more spectrum a top priority. And he has already proposed that the FCC look into taking some spectrum away from TV broadcasters to give to wireless operators to deliver more wireless-broadband services.

Naturally, the TV broadcasters oppose such a proposal.

Verizon Wireless, AT&T's main competitor, has already amended wireless-data pricing for its low-end phones in an effort to squeeze out more revenue from users. But drastic changes in data pricing could scare off some customers and curb smartphone adoption altogether.

It's like a week old article, but thoughts? I think it's a tad unfair.. you buy a data capable phone and then are punished if you use your phone "too much?"

[240sxDann]

If that gets put in to affect, I'll be switching. That's a load of BS.

[Scapegoat]

its a tad unfair for a company to limit the usage of its service? i don't think its unfair at all. They're the service provider... if they're having issues providing everyone service b/c 3% of users are using 40% of the network capabilities then they have every right to try to deter that 3%

[ASIAN JUL]

I think T-Mo had a cap on their data usage a while back, limited the G1 to 1GB a month or something. I'm just wondering what 1GB worth of data is like on a phone.

[Scapegoat]

i've had the g1 since it first came out and never noticed any sort of cap on data. and if it did, i never came close to reaching it

[ASIAN JUL]

I think they overturned it at some point or something

[240sxDann]

If the change is temporary until they can get their network to support the usage, then I'd be ok with it. But to punish me for them not being able to keep up? Thats not ok. It's not my fault their network is incapable of supporting their own customers.

[CHAOS]

old news... i can tell you this much... if they do that, thousands upon thousands will jump ship.

[ASIAN JUL]

Lol the story is like 8 days old, my bad.

[CHAOS]

Originally Posted by ASIAN JUL

Lol the story is like 8 days old, my bad.

the story itself is a bit older... no worries im sure it hasnt been posted yet.

theyve been talking about this for a couple months now off and on.

[240sxDann]

Originally Posted by CHAOS

old news... i can tell you this much... if they do that, thousands upon thousands will jump ship.

That's true. Maybe I'll just stay on, cuz then data usage will drop significantly and I can have it all for myself!

[twastheglow]

LOL @ AT&T. As if they don't suck enough with all their ****ty customer satisfaction surveys/studies. I'm sure this will help their cause just fine. LOL

[jpalamar]

The made a phone that is designed to be data hungry... then complain when people use it? What did they think was going to happen? Then after people spend $100s on the phone, have to sign 2 year contracts, and pay extra for data, they then tell you how much you can use.... CRAP!

I don't even have an iPhone, I'm a Windows Moblie guy, but ATT does suck now. A few years back, I loved it when it was Cingular.

[jcr557]

ive been having drop calls on my iphone recently

what they should do is keep the unlimited data plan at $30 and charge $20, $15, $10 for those users who choose to be kept at a limited usage plan.

[TROLL]

It said it will provide 'incentives', does it say anywhere it will cap or limit things, or create a worse scenario for anyone? Edit: I see... going from unlimited data to up to 5gb data, then additional fees for more than that.
Also, this applies to such a small percentage I doubt anyone here should be worried that it will affect them.

[DPancoast]

meh. I used the **** out my data plan when I had my iphone... now? nope.

you gotta pay to play.

[den9]

this explains why they dont have unlimited use plans on wireless mobile internet. imagine how backed up that would be.

[Subie_sleeper]

If they raise the data plan price a little at the end of my contract I'd probably still sign up.
LOVE my iPhone.
If they try to adjust anything BEFORE my contract ends I'll be jumping ship and or contacting a lawyer. If there's not already a class action suit. HAHAHA

[Glick]

Originally Posted by jpalamar

The made a phone that is designed to be data hungry... then complain when people use it?

AT&T didn't design the APPLE iPhone.

Personally, I think they should eat it and deal with it. They obviously didn't do the proper planning when they thought about carrying the iPhone and the data usage that would ensue as a result. If the actual data usage is greater than what their projection was then they need to implement a plan to deal with it. And capping their data plan MAY not be the way to go. I have no idea how much data the average smartphone user uses but I'm sure that whatever plan they go with will only affect a small number of people. Thats just my take on it.

[magnum_menace]

since i got my iPhone i've yet to have my data under 10,000 MB by the end of the service period. my usage resets on the 20th but this is my data usage so far. this is the lowest i've had. if they do set caps or start charging more for data i'm dropping at&t.