Apple and AT&T Slime iPad Buyers

A large part of Apple's iPad 3G sales pitch was the ability to buy a $30 a month unlimited data plan from AT&T.   In an announcement that clearly has been in the works long before Apple introduced the iPad, and which was only released after the first wave of iPad 3G sales, AT&T said "just kidding" to its unlimited data plan customers.  I understand where AT&T is going with this but if Apple is going to have an exclusive relationship with a cellular provider, it has some responsibility to its customers to keep them in line.

For years I have resisted the urge to switch to AT&T to get an iPhone, sticking with whatever imperfect phones I could find to access the Verizon network.  This just reinforces that choice.

Local telephone providers pretty much failed in their ability to offer reasonable high-speed data services to customers, for years losing out to cable and other suppliers.  It will be interesting to see if any cellular providers will be up to this challenge.  HT Megan McArdle.

Update: The old plans are still up at the Apple site selling iPads.  Note the new AT&T plan even cost increases the low volume plan, increasing it from $15 for 250mb to $15 for 200mb.  Crazy that Apple allowed their partner to do this within a month of the iPad 3G launch.

  • mysterian1729

    you can keep the old unlimited plan if you want

  • Gumby

    Seems like another reason to save the 3G premium and buy a Mi-Fi instead.

  • sam

    AT&T has said that the old iPad plan will remain ($15 / 250MB)

  • tehag

    Has some friend of yours ignored your advice not to buy an iPad?

  • me

    Keep in mind that you can buy a used iPhone, jailbreak and unlock it and then run it with any carrier. I know dozens of people doing just that with the t-mobile data plans.

  • Michael

    AT&T is big on the bait and switch. We have a 3 phone family plan. We had basic model phones and they had a promotion that if you buy one smart phone for $60, you could get 2 texting phones for free. This was at AT&Ts 2 year upgrade point. No one really need any of the features of the high grade phones, though I wouldn't have minded the calendering and the bigger font would have been nice for my mother. At check out, At&T said our rate would go up $30/month for each texting phone and $60/month for the smart phone. We passed on the "deal".

  • I'm just home from my annual midwest storm chase trip (2 wks) and almost ready to throw the iPhone away because of lousy AT&T service. We had innumerable places without service. Even in Phoenix, I often get missed calls when I have 4 bars of service, and have dropped calls. AT&T service, IMHO, sucks.

    OTOH, I had a Verizon data card (admittedly with an amplifier and internal antenna). We had data almost everywhere, and that means in some pretty out of the way places.

    Android is coming along as a good challenger to the iPhone, and Android phones are available on lots of carriers (there are over 120 brands introduced so far). Android pads are also coming out.

    So pick whatever service you prefer, then buy an appropriate Android phone, and let AT&T die the death they deserve, and Apple lose the business they deserve for partnering with these losers.

  • Doug

    @ John Moore ... "and Apple lose the business they deserve for partnering with these losers."
    =================
    January 30, 2007:

    Verizon Wireless was the first company offered exclusive access to the iPhone, but turned Apple away because of problems with the proposed business model. Cingular had no such reservations, and will be selling Steve Jobs' "revolution" later this year.

    Verizon Communications president and chief operating officer Denny Strigl said: "The iPhone product is something we are happy we aren't the first to market with."

    Verizon vice president Jim Gerace (one of many veeps at the company) said: "We said no. We have nothing bad to say about the Apple iPhone. We just couldn't reach a deal that was mutually beneficial."

    http://tinyurl.com/32k3mo
    =================

    50 million iPhones later, AT&T has an estimated 15 million iPhone-based customers, which is the name of the game in the saturated US cell phone market: luring new customers away from the others. Does anyone think Verizon regrets its smug 2007 decision today?

    Assuming the rumors pan out, and a Verizon iPhone materializes, it will be interesting to see how the Verizon system responds to the heavy data demands that iPhones invite. Starry-eyed Verizon users have no idea what awaits them. It's could turn out like praying that good-looking Verizon woman will marry you, only to realize (after the service contract is signed) that she is instead the perfect ex-wife.

  • Judge Fredd

    I kicked AT&T to the curb back in 2002 when they gave shitty LANDLINE service.

    This maneuver does not surprise me in the least.

    My next phone will be a Droid.

  • Mary

    I think the plan is great. It saves me money by not charging me for what I don't use. I currently have 2 iPhones on the unlimited data plan, neither of which ever goes over 50 Mb of data per month. Also keep in mind that Verizon will be rolling out the same kind of "bucket" data plans next year as they phase in their 4G system. This is something I believe you will see all carriers adopting as time goes forward. AT&T was just forced to be the first due to the heavy demand that iPhone users put on their network.

    (And, no, I am not an AT&T shill. I just have experience with all the carriers in my region. None of them are perfect or even good on average.)

  • morganovich

    i really think you missed the boat on this one coyote.

    what's so slimy about pay for use? do you subscribe to all you can eat cornflakes and gasoline? pay for use is the simplest business model out there. that's normal, not anomalous. every other utility works that way.

    all you can eat internet is going to go away away all over the net. usage patterns are changing. with file sharing and video becoming a bigger and bigger part of traffic and threats of net neutrality making it difficult to shape around that kind of traffic, a few users are consuming enormous bandwidth. there is no way to profitable serve them with all you can eat without rationing (data limits).

    bandwidth costs money. ATT is just feeling it first because they have been so successful with the iphone.

    this change will improve ATT network performance which makes it ironic that so many of the folks who complain about bad ATT service are complaining about this change.

  • Matt

    The old plan is still listed on Apple's website because the old plan is still available until June 7th. Existing users are being allowed to keep the the $30/month unlimited plan. (For how long, it's not clear)

  • Amy

    i really think you missed the boat on this one coyote.

    what's so slimy about pay for use? do you subscribe to all you can eat cornflakes and gasoline? pay for use is the simplest business model out there. that's normal, not anomalous. every other utility works that way.

    all you can eat internet is going to go away away all over the net. usage patterns are changing. with file sharing and video becoming a bigger and bigger part of traffic and threats of net neutrality making it difficult to shape around that kind of traffic, a few users are consuming enormous bandwidth. there is no way to profitable serve them with all you can eat without rationing (data limits).

    bandwidth costs money. ATT is just feeling it first because they have been so successful with the iphone.

    this change will improve ATT network performance which makes it ironic that so many of the folks who complain about bad ATT service are complaining about this change.

  • jaed

    Nothing's slimy about pay-per-use. (Unattractive to customers who don't like worrying about the possibility of ugly surprises in their monthly bill, yes. Slimy, no.) What's slimy is bait-and-switch.

  • B

    "What’s slimy is bait-and-switch."
    Anyone who purchases the unlimited plan by June 7 will be able to keep that plan at that rate for as long as they want. Those same people can also switch to the new plans if they choose to. In the meantime, I would *speculate* that ATT and Apple will stop advertising the existance of an unlimited plan (because to do otherwise would open them to litigation).
    http://www.macrumors.com/2010/06/04/atandt-considering-modifications-to-deadline-for-ipad-unlimited-3g-service-activations/
    On top of that, I'm certain that you can have your iPad alert you when you are nearing a data-use overage (not sure about the iPhone but it would make sense).
    On top of that, I've seen statistics that show that many people who visit techie site Ars Technica don't exceed 200 Mb/month on their iPhones (and you might *speculate* that they use more than average), so since it's cheaper the majority will end up saving money. I'll save money on it at least.
    I think this should be updated with the truth of what happens to the people who bought unlimited plans... slimy might be a bit of a sensationalist overstatement, especially since the change makes sense for many. And no, I don't like my ATT service at all.

  • B

    Forgot to add the link to the Ars Technica poll:
    http://arstechnica.com/telecom/news/2010/06/iphone-data-usage-we-show-you-ours-please-show-us-yours.ars
    The poll is at the bottom of the page.

  • John David Galt

    Companies have colluded to get away with this kind of bait-and-switch many times before. Finding a way to stop it without changing the legal system in destructive ways (for instance cutting back the presumption of innocence in fraud cases against large companies) is a hard problem, and so is keeping antitrust law fair.

    Sometimes even a libertarian has to admit that natural near-monopolies exist and need to be regulated. If you know a better answer, I'd love to hear it.

  • I just spent two weeks storm chasing in the Midwest, which is an activity that requires lots of internet use, loading lots of graphics, for 12-14 hours a day. My total usage was 1.2 GB.

    Conclusion: unless you are streaming media a lot, you won't use up 2GB on your iPhone or iPad. I am considering dropping my iPhone plan to the 200MB program until I scrap the service (and pay the penalty) and get a Verizon Android of some sort.