Before a recent vacation to visit with family in the US, I decided that instead of paying for international roaming rates that are tantamount to armed robbery (US$2.42 a minute for phone calls and up to US$19 per megabyte of data -- totally not kidding), I'd instead perform a trick that savvy international travelers have pulled for years: upon arriving in the States, I'd visit an AT&T store, purchase a SIM and pre-paid plan from them, and reap the benefits of far lower charges for voice calls. Though I'd still suffer exorbitant data rates, I was aware beforehand that the lovely folks at AT&T had already discontinued pre-paid data plans for the iPhone. Still, at least I'd be able to make cheaper calls to my family if necessary; or so I thought.
Upon visiting an AT&T store, the salesman I spoke to forgot to get either the IMEI or ICCID off of my phone before I removed my Vodafone SIM. He was humorously unaware that my iPhone would work just fine without a SIM in it -- no New Zealand phones are SIM locked, as it's actually illegal to do so here. Upon attempting to set the AT&T SIM up for my iPhone, however, an error popped up on his screen saying "Not allowed for this device."
After that wasted trip into town, I went back to my parents' house and contacted AT&T customer service to find out what the deal was. After half an hour of being shuffled between several different departments, someone finally gave me an answer, and what an answer it was.
Apparently, AT&T not only discontinued data service for pre-paid customers on June 11, they also placed a flag in their system to prevent any new customers from activating an iPhone on a pre-paid plan. This essentially means international travelers with perfectly good, unlocked iPhones now pretty much have iPod touches unless they want to mortgage their homes to pay international roaming charges.
As an international traveler, this new AT&T policy has me absolutely livid with rage. Rather than cater to international customers' needs by providing a solution that costs far less money than roaming, AT&T has instead chosen to leave those potential customers out in the cold by placing arbitrary restrictions on their pre-paid plans. The solution they offered - buying a GoPhone for US$30 to $40 - was obscene. I already have a perfectly good phone, but their solution for my five days in North America was to tell me to get another one, for a total cost of nearly twice what my monthly iPhone plan costs back home. Their other "solution" was to attempt to get me to sign up for a 24-month iPhone plan. Sure, why not? Who wouldn't pay for 731 days of service when they'll only actually use AT&T's network for five days?
Needless to say, I did not take AT&T up on either of their "generous" offers. I tried T-Mobile instead, but here again I met with nothing but FAIL; none of the T-Mobile outlets in my parents' area sold SIM cards at all, and since I was heading to Canada the next day to meet friends in Vancouver, a city I haven't been to since I was eleven years old, it meant being completely without any means of easily communicating with my Canadian mates or consulting Google maps if I got lost. I certainly could have found a free Wi-Fi point and contacted them via Skype, but that's a far cry from being able to contact them while on the move. I got printed directions from Google maps the day before we left for Vancouver and basically prayed we never missed a turn.
I did eventually enable international voice roaming on my iPhone, which took almost 48 hours to activate for some reason, but I did NOT turn on data roaming. That remained disabled in my settings, and because I'm ultra-paranoid about ending up like that guy who got a $62,000 bill for downloading Wall-E while in Mexico, I also put both of my e-mail accounts and MobileMe syncing on fetch, disabled notifications, and turned off location services. None of that was particularly necessary since data roaming was off anyway, but like I said, I'm paranoid. I also left my phone in airplane mode for most of the trip unless I knew there was a free Wi-Fi point nearby, which as I said earlier basically meant I had a more expensive iPod touch.
It didn't ruin my vacation by any stretch, but AT&T's self-serving, idiotic policies definitely made things far more inconvenient for my wife, my Canadian friends, and me than they needed to be. While the iPhone may be very nearly the perfect companion for the international traveler, by far the weakest link in the chain is the telecommunications companies, whose intergalactic-level greed somehow makes it justifiable to charge roaming customers over 3000 times more than on-account customers (based on US$30 for AT&T's "unlimited" [5 GB] plan vs. US$19 per MEGABYTE on Vodafone NZ's international roaming data rates while on Rogers Wireless's network in Vancouver).
Bottom line for international travelers planning on visiting the USA with your iPhones: brace yourself for disappointment, because AT&T no longer caters to your needs -- they're more concerned with catering to their own.
TUAW's Erica Sadun has pointed out a possible way to get around this new restriction, though as I've returned to New Zealand, I have no way to test whether it works or not:
"The US 3G and 3GS let you insert AT&T cards, even non-iPhone plans, in the US. It's possible that you might be able to use branded AT&T SIMs in the US when travelling (although you'd give up data).
"Best Buy offers a $10 O2 SIM that supports international calling ($$$$) and $0.17/minute meant to be used with unlocked but tested in US locked iPhones. It's just a rebranded AT&T card (starts with 8901 on the SIM).
"It's a possible avenue for international visitors and is meant for use for people with foreign phones."
If that does indeed still work, it sure would have been nice to know about it before I left. But during my phone conversation with the AT&T CSR, I did straight up ask her what my options were as an international visitor, and the only options she gave me were buying a GoPhone or signing a 2-year contract. Given the fact that AT&T has nuked the iPhone pre-paid plans and set up flags in their system to prevent new users from activating pre-paid SIMs on the iPhone, I don't know if Erica's solution will still work. If you're able to test it, let us know in the comments.