AT&T: No More Fixed-Price, Unlimited Internet

Photo (cc) by William Hook

If you’re planning on getting an iPhone, iPad or other web surfing wireless device from AT&T, don’t plan on unlimited web-surfing for a low monthly fee.

On Monday, AT&T will stop offering unlimited Internet access for its new smartphone customers. Existing customers will be able to stay on their unlimited plans, at least until their current contracts expire, but new customers will have to choose from two different plans: the Dataplus plan that offers 200 megabytes of data for $15/month, and the Datapro plan that offers 2 gigabytes for $25.

The company says it will send text messages to users of either plan warning them as they approach their limits. Going over means paying an extra $15 for 200 more megabytes for Dataplus customers; Datapro customers will be charged an extra $10 for an extra 1 Gig.

If you live in an area like New York or San Francisco where the iPhone is notoriously unreliable, you can probably guess the reason for the move: to get a more reliable network for everyone by charging more to those who use the most capacity. According to an AT&T spokesman quoted in this USA Today article, just 3% of smartphone users account for nearly 40% of traffic.

Of course, if that minority is willing to pay for the extra usage, the network will still be overloaded and calls will still be dropped — the only change will be that AT&T will make a lot more money.

According to the article above, other major carriers are considering following suit.

And that’s not all AT&T has announced recently when it comes to charging more. On June 1st, AT&T doubled termination fees for smartphones. Here’s a quote from an “Open Letter to our Valued Customers” AT&T published on May 21st: words in parenthesis are mine.

For customers who enter into new two-year service agreements in connection with the purchase of our more advanced, higher end devices, including netbooks and smartphones, the ETF (early termination fee) will increase to $325 (from the current $175) and be reduced by $10 for each month that you remain with us as a customer during the balance of your two-year service agreement. After that, the ETF will no longer apply.

That means that if you quit your contract with only one month to go, you’ll still owe $85.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

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