AT&T makes sweeping changes to data plans, iPhone tethering coming at OS 4 launch

By Chris Ziegler

posted June 2nd 2010 3:00AM

Breaking News

You might think that AT&T would hold off for a national HSPA+ deployment or a full-on LTE launch before tweaking its data pricing strategy, but not so much -- the carrier is coming out swinging today with some significant changes that should benefit the overwhelming majority of its smartphone users (and could stand to harm a select few). Let's break down the major points:

DataPlus / DataPro

The existing $30 fair-use "unlimited" smartphone data plan is being replaced by two new options: $15 per month for 200MB and $25 for 2GB (called "DataPlus" and "DataPro," respectively). Customers currently on the $30 plan are welcome to stay on it, but they can switch at any time without extending their contract.
AT&T's new overage system is arguably the game changer: on the $15 plan, you'll pay $15 for each additional 200MB, but on the $25 plan, you'll pay $10 for each additional GB. It's simple and straightforward -- but most importantly, it won't bankrupt you if you go over by a gig or three in a month. This compares to $50 per gigabyte of overage on AT&T's 5GB DataConnect plan for laptops.
The carrier's going to be very flexible about changing between the DataPlus and DataPro plans -- if you're on DataPlus, for example, and you discover that you're blowing past your allotment, you can choose either to start DataPro the following billing cycle, pro-rate it, or apply the higher plan retroactively to the beginning of your current billing cycle. That's pretty wild.

Tethering

Tethering will be offered as an add-on to the DataPro plan for an additional $20 per month, which means you'll pay a total of $45 a month for 2GB of data shared between your phone and your tethered devices. If you're light on the usage, it's a sweet deal -- but if you scale it up and you're using the data almost exclusively on your laptop, it compares unfavorably to the traditional DataConnect plan: $60 versus $75 for 5GB (and in the unlikely even you've got a webOS device on Verizon, it compares even less favorably). If you're striking a balance of data use between a smartphone and tethered gear, AT&T's new setup is still pretty solid considering that you would've been paying $60 for the USB stick plus $30 for smartphone data before.
Yes, it's finally happening: AT&T's iPhones will get access to the tethering option, too.

iPad

iPad users are also affected by the change. The $30 iPad data plan -- lauded for being labeled by AT&T as truly unlimited -- goes away to be replaced by the same $25 / 2GB plan that smartphone users will see, though current subscribers to the $30 plan can continue unaffected.

Everything launches on June 7, except for iPhone tethering -- it'll launch when OS 4 does. In the meantime, we're told users can sign up for the $30 plans both on their phones and iPads if they'd like to be grandfathered in. Follow the break for more details along with AT&T's full press release.

We're definitely mourning the death of unlimited data -- "unlimited" is a word that consumers always naturally like to hear -- but AT&T points out that 98 percent of its smartphone subscribers use less than 2GB a month, which means that nearly all users ultimately stand to see a $5 reduction in their monthly bills. We spoke to Mark Collins -- AT&T Mobility's senior vice president of data and voice products -- about the changes for a few clarifications on the company's strategy, and he made it crystal clear that the concept of unlimited data is a thing in the past (echoing comments made recently by Verizon's Lowell McAdam), particularly in light of the oncoming spectrum crunch that stands to make wireless broadband an even more precious commodity than it already is. He also mentioned that laptop plans are unaffected by this move, though he went on to say that they've laid a "framework" for data pricing here that should continue all the way through to the company's LTE rollout, so we wouldn't be surprised to see some tweaks made on the laptop side sooner or later (to reduce overage fees, if nothing else).

We mentioned that the change stands to hurt a few users, and it's true -- we're extremely heavy smartphone users here, for example, and we're hard-pressed to break even a gigabyte of usage in a month; anyone doing a boatload of video streaming though, or lacking access to WiFi at home and the office (AT&T's quick to boast about its 20,000-odd hotspots) might find themselves regularly slamming headlong into that 2GB cap, and there won't be any option but to buy overage. For what it's worth, Collins pointed out to us that the plans will feature automatic text and email alerts at 65, 90, and 100 percent usage of your monthly allowance (and at 75 and 100 percent usage of each overage purchase), so it should be pretty easy to keep an eye on things and make sure you don't break the bank.

Show full PR text

AT&T ANNOUNCES NEW LOWER-PRICED WIRELESS DATA PLANS TO MAKE MOBILE INTERNET MORE AFFORDABLE TO MORE PEOPLE

DALLAS, June 2, 2010 - AT&T*, the U.S. smartphone leader, today introduced new wireless data plans that make it more affordable for more people to enjoy the benefits of the mobile Internet. Customers can pick the new data plan that best meets their needs - either a $15 per month entry plan or a $25 per month plan with 10 times more data. Current smartphone customers are not required to switch to the new plans, but can choose to do so without a contract extension.

"AT&T helps mobilize everything on the Internet - your favorite web sites, TV shows, music, games and social networks. Virtually everything previously done while sitting at a computer can now be done on the go," said Ralph de la Vega, president and CEO, AT&T Mobility and Consumer Markets. "To give more people the opportunity to experience these benefits, we're breaking free from the traditional 'one-size-fits-all' pricing model and making the mobile Internet more affordable to a greater number of people."

Each plan includes unlimited access at no additional charge to more than 20,000 AT&T Wi-Fi Hot Spots in the U.S. Customers can also use unlimited Wi-Fi at home, in the office or elsewhere if available. AT&T will also help customers manage their wireless data usage by sending free text messages when customers reach different usage intervals, and by providing online tools, including a smartphone app that shows monthly usage information.

The new wireless data plans - including a new tethering option - will be available beginning June 7. Current AT&T voice and texting plans are unchanged.

More Choice

The new AT&T plans provide large amounts of data to enable people to enjoy their favorite online activities:

* DataPlus. Provides 200 megabytes (MB) of data - enough to send/receive 1,000 emails (no attachments), send/receive 150 emails with attachments, view 400 Web pages, post 50 photos on social media sites and 20 minutes of streaming video - for just $15 per month. This plan, which can save customers up to 20 percent off their wireless voice and data charges, is designed for people who primarily like to surf the web, send email and use social networking apps. If customers exceed 200 MB in a monthly billing cycle, they will receive an additional 200 MB of data usage for $15 for use in the month. Currently, 65 percent of AT&T smartphone customers use less than 200 MB of data per month on average.

* DataPro. Provides 2 gigabytes (GB) of data - enough to send/receive 10,000 emails (no attachments), send/receive 1,500 emails with attachments, view 4,000 Web pages, post 500 photos to social media sites and watch 200 minutes of streaming video - for $25 per month. Should a customer exceed 2 GB during a billing cycle, they will receive an additional 1 GB of data for $10 for use in the month. Currently, 98 percent of AT&T smartphone customers use less than 2 GB of data a month on average.

* Tethering. Smartphone customers - including iPhone customers - who choose the DataPro plan have the option to add tethering for an additional $20 per month. Tethering enables customers to use their smartphone as a modem to provide a broadband connection for laptop computers, netbooks or other computing devices. Tethering for iPhones will be available when Apple releases OS 4.0 this summer.

With the new wireless data plans, pricing for a smartphone voice and data bundle now starts at just $54.99 per month for an individual plan, or $24.99 per month for an additional line on a FamilyTalk plan, $15 per month less than the price of the previous entry level bundle.

For new iPad customers, the $25 per month 2 GB plan will replace the existing $29.99 unlimited plan. iPad customers will continue to pre-pay for their wireless data plan and no contract is required. Existing iPad customers who have the $29.99 per month unlimited plan can keep that plan or switch to the new $25 per month plan with 2 GB of data.

Wi-Fi at 20,000 AT&T Hot Spots

The vast majority of smartphones that AT&T offers have built-in Wi-Fi, which lets the devices automatically switch from the wireless network to a Wi-Fi hotspot without prompting, making Wi-Fi even more convenient and easy to use. This enables customers to use Wi-Fi in the home, office and at public locations where available. Using Wi-Fi does not count against a customer's monthly data plan usage total. In addition, virtually all AT&T smartphone customers have access at no additional charge to more than 20,000 AT&T Wi-Fi Hot Spots at Starbucks, Barnes & Noble, and other U.S. locations. Customers can get more information on how to use Wi-Fi and find the location of AT&T Wi-Fi Hot Spots at www.att.com/wifiaccess.

Monitoring and Managing Usage

To help customers easily check their data usage, AT&T has made the information readily available in a number of ways:

* Customer Text Notifications On Data Usage. When customers begin to approach their monthly usage limit, AT&T will send three text notifications - when they reach 65 percent, 90 percent and 100 percent of the threshold. Customers will also be sent emails if AT&T has their email address.

* Data Usage Monitoring. Additionally, customers with iPhones and other select devices can use the free AT&T myWireless application to check data usage. The application is available for download in several smartphone app stores. Also, AT&T customers can call *DATA# from their wireless phone to check their data usage for the current billing period. They receive a free text message with their usage information. Customers can also go online to www.att.com/wireless to see all their usage information, past and present.

* Data Calculator. The easy-to-use online data calculator enables customers to estimate their mobile data usage and get a better sense for which data plan is right for them. It's located at www.att.com/datacalculator.

Customers can learn more about the new plans online at www.att.com/dataplans, by contacting AT&T customer service at 1-800-331-0500, or by visiting an AT&T retail store.

AT&T expects these new data plans to have minimal revenue impact this year and to not affect previous guidance for 2010.