Is AT&T Just Hurting Itself With New Data Plans?

AT&T's decision to nix unlimited data plans may be yet another instance of the much-maligned company damaging its already shoddy reputation. Did AT&T institute these sweeping changes to shield itself from further abuse and strengthen its network, or has it spun the chamber on another round of Russian roulette?

Here's the quick and dirty on AT&T's new smartphone data plans:

  • DataPlus: 200MB of data for $15 per month. AT&T claims this is plenty for 65 percent of its customers. Exceeding the plan gives you another 200MB for another $15.
  • DataPro: 2GB of data for $25 per month. This will satisfy 98 percent of its customers, according to AT&T. Each additional GB costs $10.
  • Tethering: To tether your iPhone, you need the DataPro plan and another $20 per month. Spending GB on tethering counts against your DataPro 2GB.

If you're already paying $30 per month for unlimited data, you're welcome to keep that package -- for now. The cynic in me says that once these new plans gain steam, AT&T may strip customers of those privileges.

So what does this mean for iPhone and iPad users? As AT&T says, most people won't be affected, and many people will actually save money. Grandfathering the unlimited plan for current customers was a smooth and democratic move.

However, starting June 7, brand-new iPad owners might get miffed about the new limitations. There's a reason why it's called the iPad 3G: it's meant for a 3G network. iPhones can take their toll on AT&T's network -- just try to make a phone call sometime -- but the iPad was designed for network data usage, more so than the iPhone.

Steve Jobs personally commented on AT&T's service at the D8 Conference. Though he was somewhat enigmatic about his opinions -- wouldn't want to bite the hand that feeds, after all -- he did dish a backhanded compliment. "When Walt Mossberg asked Jobs how AT&T was doing on the network side of things, Jobs at first said AT&T was doing 'pretty good.' But then quickly noted that 'they have some issues,'" TechCrunch reported.

Other opinions in the blogosphere were similarly mixed. "Already we can see the comments forming: This is about throttling bandwidth. This is about giving less for the same amount of money. But we see a lot of good here..." Matt Hickey wrote for CNET. (Throttling has been a big PR nightmare for other companies, especially Comcast.)

The possibility of even more shifts in data usage plans intrigued Ryan Kim with the San Francisco Chronicle. "The big question is will these limits change as the usage goes up and the networks get more upgrades? If not, this could be affect an increasing number of users and could throw some cold water on the mobile data revolution going on.

Even if the limits change, just knowing there are limits could stifle some usage. That might be good for network reliability. But it still feels like the end of an era."

AT&T could win or lose in this situation -- it's hard to tell. Most customers will only care about saving money. Hardcore data users could get upset about the sudden changes. And new iPhone and iPad customers who like surfing the Web on their phones and tablets, respectively, could get really upset. What will be especially interesting to watch is how other wireless carriers will react to AT&T's brave new world. Competitive pricing between carriers could definitely entice customers away from Ma Bell, meaning AT&T just shot itself in the foot.

For comprehensive coverage of the Android ecosystem, visit Greenbot.com.

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