The wireless data paradox: AT&T asks you to use less data

AT&T top story badgeSo let me get this straight: AT&T says iPhone users are using too much data. And to ease the resulting strain on its network, the carrier wants to...(ahem)...encourage its customers to throttle back on YouTube, live-streamed radio, and other media-rich apps. A week after playing the good guy with "Mark the Spot," a handy iPhone app that lets users report on coverage dead zones, AT&T is reversing any goodwill gained by warning heavy users they may soon face extra charges for their data gluttony.

Someone please tell me this is little more than a badly thought-out joke.

Since when does a supposedly progressive-thinking company try to rein in its customers' behavior by asking them to turn back the clock? Last I checked, technology tended to evolve in only one direction, and trying to slow it down or reverse it would be as advisable as attempting to hold back an accelerating space shuttle. Of course, an iPhone isn't cranking out millions of pounds of rocket-fuelled thrust, but the prospect of millions of subscribers peacefully going along with AT&T's grand plan strikes me as risky and ill-advised in its own right.

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A failure of its own making

Part of me wants to feel more than a little sorry for AT&T. Its exclusive deal with Apple should have been a coup for the carrier. A couple of years of US market exclusivity for the iPhone should have been more than enough to attract -- and keep -- scads of Apple-loving, subscription-paying smartphone fans who happily lived at the upper end of the average revenue per user (ARPU) curve. The marquee value of being the iPhone's exclusive carrier should have been sufficient to reinforce AT&T's market position in the brutal pecking order of carriers.

But a funny thing happened on the way to smartphone nirvana: AT&T's network proved to be woefully under-built for the iPhone's unprecedented data appetite. So rather than spend what it needed to bolster the nuts and bolts that kept iPhone users connected and happy, the company instead continued to market the heck out of its uber-product -- and in doing so continued to hope that folks wouldn't notice.

Unfortunately for AT&T, they did notice. And as more iPhone users use more data-heavy apps (just what the ads have been telling them to do all along), network reliability continues to plumb the depths and subscriber complaints continue to pour in. The problem, particularly acute in device-dense urban areas, manifested itself most recently in San Francisco this past Friday, when many iPhone users found themselves without Internet connectivity for much of the afternoon. It wasn't the first time this has happened and it likely won't be the last as iPhone mania -- both in terms of new users signing onm and existing users becoming more at one with the device -- shows no signs of abating.

Not entirely in control

Sadly for existing AT&T customers, it doesn't look as if the carrier has much of a handle on the problem. Speaking at a conference last week, CEO and president of AT&T mobility and consumer markets Ralph de la Vega admitted its New York and San Francisco wireless coverage was "below our standards." Jim Cicconi, the company's senior executive vice president of external and legislative affairs, was similarly blunt, in an interview last week with CNET's Marguerite Reardon:

Wireless-data usage is growing far faster than anyone had expected. And if we don't do something soon, we will run out very fast. And then we will have to start telling wireless customers that they can't do all the things they want to do with their devices.

I have to apologize to Mr. Cicconi, who clearly wishes he had had happier news to share, but his position is bogus. Data usage didn't grow faster than anyone -- notably AT&T -- expected. It grew just as quickly as the pundits claimed it would. In fact, we'd be in even worse shape if the economy hadn't tanked and kept even more consumers from diving into the iPhone pool.

It's hard to believe that AT&T couldn't anticipate the wireless data growth curve. It's also rather easy to believe AT&T hoped it would be able to ride the iPhone wave without investing enough in its wireless infrastructure to handle the load. Like the car owner who puts off slapping on winter tires as the cheapskate's way out of preparing for winter, AT&T got caught short when the big blizzard rolled in and it was woefully unprepared.

All of which leaves AT&T in an unenviable position where 3% of its iPhone subscribers account for 40% of total data usage. Does it institute usage caps on these heavy users? Does it throttle them back? Does it charge them through the nose? Perhaps it might consider doing all three. If you want to play the game at a level or two beyond everyone else, after all, perhaps you should be willing to pay extra for the privilege.

History repeats itself

We've been down this road before, of course, with peer-to-peer downloaders running afoul of ISPs' acceptable use policies. In many cases, usage caps, throttling and differential rate plans have quelled the debate, and ensured regular folks can still get stuff done online without their sessions slowing to a crawl. We'll save the net neutrality debate for another day, but clearly the industry needs a way to balance the needs of the heavy-duty users with those who just want to send an e-mail to grandma.

Unfortunately, AT&T exemplifies precisely the kind of strategy the industry doesn't need right now, if ever. You can't sell the heck out of a solution, starve it, and then hope consumers don't complain too loudly. You can't blame the mega-streaming 3% for doing what your ads have been begging them to do since the day you first started selling the device. You can't back away from your own accountability to do everything you can to deliver a quality end-user experience. You can't use differential rate plans before you've ensured your network can first be all that it can be.

And if you try, consumers with long memories will keep that in mind the day you lose exclusivity. Because the first carrier that punishes heavy users in this manner will itself end up punished.


Carmi Levy is a Canadian-based independent technology analyst and journalist still trying to live down his past life leading help desks and managing projects for large financial services organizations. He comments extensively in a wide range of media, and works closely with clients to help them leverage technology and social media tools and processes to drive their business.

43 Responses to The wireless data paradox: AT&T asks you to use less data

  1. menting says:

    don't sell unlimited unless you really mean it. I wish the FCC would crack down on this kind of false advertising. Nobody would complain of being lied to if they said in the ads that you pay $30 for like 5GB of data. Same for Comcast. Don't advertise unlimited when it's really 200GB worth of data.

    • RationalCop says:

      They haven't falsely advertised anything yet. No penalities or restrictions have been placed on data users yet. There is nothing for the FCC to "crack down on".

      IF they change their policy or practice, but then continue to advertise otherwise, THEN you may have false advertisement. Simply asking users to use less data is not compulsory and does not actually affect what you can do with the product or service you pay for.

  2. bigsexy022870 says:

    I wanna know what they consider to much data usage. Cause i use alot of the music and vide streaming apps. They want you to buy the phone and then the apps that are so cool but require lots of data usage. They need to fix the issue on there end not ours. We are doing what they wanted us to do.

    In all fairness even I didnt forsee such high data usage. I came from a Motorola Razr. So while i could spend all day on the internet i sure didnt want to. But the iphone made alot possible that just wasn't b4 the iphone came along. I still feel 30 bucks for unlimited access is fair, if not a little high. I don't use more then 2gigs a mth. If there are people useing alot more then what the heck are they doing. I mean do they have jobs? Cause I love my phone but life and work dont allow me to stare at the phone 24/7.

    • PC_Tool says:

      "I wanna know what they consider to much data usage"

      +++

      They need to specify the limits before enforcing them, but I would check the ToS...they may already be specified. If they are instituting a new cap, obviously, it should be one the users are aware of and can track.

    • gawd21 says:

      This is another perfect reason why the Cloud will fail!!!!!!!!!!!!!!!!!

  3. Neoprimal says:

    I'm by no means defending these companies. But you have to admit, we have a very long history of hidden realities. If I can eat 100 plates of food, I guarantee that the All-You-Can-Eat Buffet isn't going to allow me to sit there and eat 100 plates. They're either going to 1. tell me that 4 or 5 plates are the limit or 2. tell me that 2 hrs. is the limit. Basically, they're going to find a way to make me leave before eating 100 plates of food.

    Broadband and Cellphone data consumption are similar. Unlimited means by all certain standards, all-you-can-surf, and not necessarily all-you-can-download. No amount of youtube, huluing, surfing, video or voice chatting will reach most of the caps set by providers who advertise Unlimited. Like All-You-Can-Eat Buffets however, they've made a terrible mistake in not realizing that there are a few that will take 100% advantage of said 'claims'.

    While any normal person would eat a plate or 2 and be done - there are a few that will keep going until they can barely move. Some internet users feel that they're entitled to use an unspecified/unlimited amt. of data and it just doesn't work like that...it can't.

    The RIGHT thing to do would be simply to advertise that for xx.xx you're getting roughly 250GB per month - but that's not entirely true either, is it? Because you're not necessarily penalized for it unless it happens 2 or more months in a row or unless you download 3 or 400GB for the month (or maybe week, for some)...which is grossly excessive. The fact is, Unlimited has never, ever truly been Unlimited, and they simply need to re-phrase, which I think they have. Nowadays they don't advertise Unlimited, perhaps unlimited surfing, but not unlimited downloading. 250+ GB of traffic is easily 'business'/commercial account worthy...and check out the cost of a T1 line from any ISP.

    This goes twofold for cell companies.

  4. figaro331 says:

    I'm completely agree with the author of this article. Two things in this world have no limits: greediness and stupidity !! AT&T is greedy without any limits and must be stopped! I do not see any effort from AT&T to develop their network, improve current situation but rather acts like a vampire to suck our blood to last drop till we are all die!

  5. Bogunch says:

    @Neoprimal: I agree - unlimited means within reason

    • ir0nw0lf says:

      Merriam-Webster Dictionary: unlimited: unrestricted, boundless, infinite. Guess the cell phone companies are now re-writing textbook definitions? They shouldn't use that word unless they mean it. Just like some places a "lifetime" warranty is only for the life of the product on the primary market, not the life of the company. Stop hiding the limitations.

      • Bogunch says:

        SFI - your definition would apply if there was unrestricted, boundless, infinite bandwidth available - there isn't! Live with it!

      • -Wanted- says:

        Then the appropriate descriptors need to be used in their marketed advertisement.

    • RationalCop says:

      Hmm, yea, unlimited means "within reason" if we change the definition.

    • tiburoncito_2000 says:

      I would agree to that if the charges were less. I want to get my moneys worth!

  6. shallot says:

    I know AT&T is not a brand one would root for...but I guess in this case they have a point. People with their iphones have really pushed the limits too much....but I guess the real blame has to be for AT&T who were greedy when they put out iphones on their network without thinking the consequences....

    • bousozoku says:

      AT&T had plenty of problems before there was one iPhone on their network.

      • God Dammit ! says:

        @ bousozoku - No they didn't. Don't blame the network for problems that are clearly with your phone.

    • RationalCop says:

      I'm not sure how one "pushes the limits" when they use a product they paid for at a service rate and plan prescribed by the provider. The $30 data plan rate includes "unlimited data".

      ALL major carriers want to be "greedy" by attracting more customers to their network... that's kinda what they are there for, to make money. What they apparently did not foresee was that iPhone users would actually use their smartphones so much. To my knowledge, no other smartphones are used as much as iPhones. One could imply that the iPhone apparently got something right in terms of usability that other smartphones were lacking up to that point.

      However, AT&T may run into public relation problems if they start throttling bandwidth, limiting data usage or charging higher rates for more data usage as that is a change from one of the things they "enticed" people with when they bought their iPhones.

      IF Verizon picked up the iPhone at some point in the future, they would be best to consider such limitations at the start. Of course, they will be operating with the benefit of knowing what has happened in the AT&T situation, something of which AT&T did not have the benefit.

      • bousozoku says:

        @RationalCop:

        The four big carriers changed "unlimited data" with some very small text saying "5 GB maximum" a couple of years ago. AT&T has always been worse in similar usage situations, i.e. not allowing mobile phone use to attend conference calls.

      • RationalCop says:

        I'm not sure if you include AT&T as one of the four major carriers, but here is what they say on their website about "unlimited data" for the iPhone.

        "Data Plan for iPhone includes unlimited data in the U.S. Access rich HTML email and desktop-level web browsing, as well as Visual Voicemail to listen to voicemail messages in any order you choose.

        Please note: AT&T is Apple's exclusive carrier partner for iPhone in the United States. An eligible data plan for iPhone is required. This data plan covers data usage in the United States and does not cover international data usage and charges. If AT&T determines that you are using an iPhone on your account without an eligible data plan, AT&T reserves the right to add an eligible data plan to your account and bill you the appropriate monthly fee."

        I'm not seeing this very small text you are referring, but if you provide a link I'd be happy to check it out.

  7. jermort says:

    Every day my wife demands that I get rid of my iPhone. Doesn't ring, cannot pick up when it does. Voicemail?? Joke of the day! My notifications for VM are sometimes a day late! I only get reliable data when I'm on my WiFi.

    Perhaps some competition would help (or at least spread out the pain). Verizon would be smart to run from the iPhone like the wind!

    Ahem,,, ATT, are you listening???

  8. lvthunder says:

    First it is Apple advertising the iPhone not AT&T. If you notice the AT&T ads generally show the other phones they sell.

    Also there is a limit to the amount AT&T can do. There are only so many cell towers they can build within an area. Also there is a limit to how fast you can build this stuff out. In Las Vegas where I live it takes about 9-12 months to get a set of plans approved by the local government. So I think this trying to get customers to stop using data is just AT&T trying to stall until they can get the infrastructure in place.

  9. tiburoncito_2000 says:

    what a crock!

    This is such a lame excuse to push user to pay more. If I do not use my connection on the phone I leave my PC connected via the SIM adapter to maximize what I download. So much for unlimited usage. It should be rather call unlimited charges as we are greedy bastards.

    Mark my word if AT& gets is way and start charging more for unlimited then the other networks will follow. $15 should be the max they should be able to charge for unlimited internet access and unlimited texting.

    bah-amba AT&T

  10. extremely well says:

    Both the FCC and the FTC need to get involved. AT&T advertised unlimited knowing full well that if they promoted a new product with "5GB/mo limit", it would turn off too many customers, vast majority of whom would never even use more than 3GB/mo...

    So they advertised "unlimited", of course with the little fine print stating "as long as it doesn't hurt our network" (the copout clause EVERY SINGLE TECH COMPANY HAS ALWAYS USED WHEN GIVING "UNLIMITED" SERVICE).

    So the FCC and FTC need to step-in and say: "Bravo, AT&T, you made the right marketing choice to push the product with clever wording. Now you can't have the cake and eat it too. This is what you're gonna do for us: YOU WILL ALLOW THE HEAVY USERS (WHICH YOU HATE ANYWAY SINCE YOU LOSE MONEY ON THEM) TO LEAVE WITHOUT PENALTY (IF THEY CANNOT CUT BACK USAGE), AND YOU WILL GIVE THEM THIS NIFTY PRINTED GUIDE INFORMING THEM THEY CAN TAKE THEIR UNLOCKED IPHONE TO CELL PROVIDER X Y Z, OR THAT THEY CAN SELL IT UNLOCKED ON EBAY. AND NOW, SINCE YOU 'ALL OF A SUDDEN' 'REALIZED' THAT YOU CANNOT OFFER AN UNLIMITED DATA PLAN, WE WILL FORCE YOU TO NO LONGER USE THAT WORD, AND SPECIFY HOW MANY MB DATA MONTHLY YOU ALLOW PER PRICE PLAN, AND WE WANNA SEE YOU TELL US IN ADVANCE WHAT YOU'D DO FOR A THEORETICAL 100-GB PER MONTH USER -- NO COPOUTS THIS TIME AROUND..."

    It wouldn't be fair for AT&T to just change the rules of the game in the middle of a contract for their existing customers without giving them the option of early termination WITHOUT A FEE.

  11. Anastasia2007 says:

    Sure AT&T.. I'm using a lot less data on your network since I switched to Verizon.. ;)

  12. PC_Tool says:

    *laughing*

    [i]"Waaah!"

    "I can't be assed to read the ToS or the fine print, so I am going to whine when they actually start enforcing them!"

    "Just because they said "unlimited" I am going to apply that word to *everything* they offer....not because they have given me any rational reason to, but simply because I am an entitled, whiny, little brat!"[/i]

    Yeah....pretty much all I hear when you idiots start whining about the definition of "unlimited".

    Try being rational for a change. Perhaps reality wouldn't be quite so disappointing for you.

    • psycros says:

      Or maybe AT&T could start being honest by not using the term "unlimited" without any caveats, because they do in every single advertisement. And maybe you could try not being a pathetic corporate lapdog for 15 seconds, Tool. Then perhaps you wouldn't need to fill your empty existence with repetitive, tiresome attacks on anyone who takes issue with deceptive marketing.

      • PC_Tool says:

        1.) There are caveats, you're just too entitled to be bothered to actually find out what they are. Any thinking person would know that "unlimited" never comes without caveats. Ever.

        2.) Maybe you should try thinking like a logical, rational person for 15 seconds instead of the entitled brat you are coming across as?

        3.) Deceptive advertising sucks....when the caveats aren't obvious and people don't pretend they don't exist to support their entitlement issues.

        Any idiot with half a brain (Yeah, you can get by with half...probably less) can watch one of those commercials and *know* without a doubt that "unlimited" does *not* apply to "everything". Thinking about it for less than 10 seconds would probably allow that idiot to come up with few things it might actually not apply to.

        Just because you're an idiot doesn't mean everyone else has to change their ways to make life less disappointing for you. It's not our fault you're an entitled moron.

  13. Adrian79 says:

    ATT unlimited data plan = $30 (oh, but please dont use unlimited because we charge you more?!)

    WWWTTTTTFFFF????

    the word "unlimited" actually means "limited"? gee, do i hear class action???

    • PC_Tool says:

      It means unlimited...but it applies to the availability of the connection and *access*....not data amounts or speeds.

      Are you all really this clueless, or are you simply trying desperately to rationalize your entitlement issues?

      • Hidden_Agenda says:

        What PC_Tool said.

        Though it is worth mentioning that ATT's unlimited data plans do actually have a 5GB limit on data. Check the fine print sometime.

      • extremely well says:

        No, the iPhone doesn't have a 5GB limit on data. YOU check the fine print BEFORE propogating disinformation. Thanks.

        http://www.pcmag.com/article2/0,2817,2356972,00.asp

        "This probably has something to do with how data card subscribers (at $59.99 per month) have a 5GB cap, whereas right now smartphone users don't."

        CLEARLY there will soon be a 5GB limit for iPhone users; this "news" articles propaganda is just to ease the minds/get the support of the vast majority of users who DO NOT NEED MORE THAN 5GB. So AT&T "thinks" about placing a limit, "tries" to discourage users with words, and then "is forced" to place a hard limit. Of course the FCC/FTC is smarter than that and any MAJOR CHANGE TO TERMS OF SERVICE will basically null-and-void any customer obligations from existing customers, and may also come with severe penalties, such as forcing AT&T to buy back, at full purchase price, all hardware.

      • Neoprimal says:

        @PC_Tool

        I think some of them really do believe that because these companies use the term "unlimited", they can sit there and fill up a couple of their 2TB drives and ATT/Comcast shouldn't say hoot about it.

        I feel badly (but not too badly) for some of these companies that assume we as human beings all have some common sense. Moral of the story, stop using the word Unlimited, period. Stop assuming that people will understand that it doesn't mean having no range in limit or scope.

        That any one person should be able to sit there and gobble up even 50GB of data on their 8/16/32GB Iphone 3GS and be justified in it, is beyond me. I have a rough time on Comcast, much less a cell phone.

      • Adrian79 says:

        no i'm not that clueless, i'm just talking crap.. honestly this topic has been covered many times this year already with Comcast... unlimited access or unlimited whatever, but its the word itself and how its used so loosely on there advertizing schemes that tricks people.

      • Adrian79 says:

        no i'm not that clueless, just talking crap.. I remember few months back or so, this same topic with the word "unlimited" and how its used so loosely during advertising causes intentional confusion for most people! - see comcast previous articles

  14. partypop says:

    1. Most people are with AT&T because of the Iphone. If people cannot use their phones
    features why stay with AT&T? By my calculation if AT&T were to lose its Iphone customers they would be bankrupt. Everyone I know only has AT&T because of the Iphone and the Coverage sucks admitted by everyone Iphone user I spoke to.

    2. Instead of begging the public to exercise self-control, which everyone knows will not happen otherwise you or I wouldn't have gotten that speeding ticket, why not turn to your
    developers for some ideas instead of looking like fools to the public.

    Here is a free idea, no charge for this one: Its called DATA COMPRESSION. Use some
    existing technology that will lessen the traffic. Nobody needs Youtube videos to have
    crystal clear picture or THX sound on a 2 inch device.

    • God Dammit ! says:

      True, but what about people who use a 3G modem of some sort with their regular computer? Having a crystal clear picture and THX sound quality are the two most important things in this case. Data compression would negatively affect AT&T's numerous other customers.

    • extremely well says:

      There will always be people who don't want the battery drain and lag that heavy de-compression (even on the fly) will cause. And these compression technologies cost a lot of money to implement because you're talking server-side compression here.

      While it would be nice AS AN OPTION, really the only way to solve this problem is place a hard limit (of probably 5GB/mo - hopefully rolled over to a max of 10GB) and then the users will themselves start to conserve.

      And here's a free, completely do-able method to save browsing wasted bits AND speed up browsing: run an ad-blocker and script blocker on a white/grey/black-list basis. Or disable loading of images in specific locations on the page displayed. An image right next to an article in CNN is more important than images plastered all around the frame.

      So in a way you're right, new software technology will conserve some mobile data waste, but never enough to prevent the network to collapse without a hard limit. Even Comcast implemented a 250(!!!) GB limit per month. That tells you there are some crazy b*stards out there that probably used 500GB per month, consistently month after month... Running an FTP server will get you over the limit very fast.

  15. God Dammit ! says:

    Not with my broadband. On my FiOS internet service, Verizon still says I can download and upload as much data as I want.

    • lilchina says:

      unlimited data is is the same as all you can eat or is it? If the food runs out and you're still hungry is it still all you can eat? They will have to get rid of the unlimited description and call it limited if they put caps on. Thus they will lose a lot of business. I won't renew. Time Warner tried the same cap lilmitation and got so much bad publicity they had to kill that program. Go Ahead AT&T slit your own throat if you dare

  16. gorgeth says:

    This is exactly the same position the cable broadband providers took, advertising DOWNLOAD MOVIES AND TV DOWNLOAD MUSIC STREAM EVERYTHING.. then going YOU ARE USING TOO MUCH WE MEANT TO WATCH A youtube clip not stream 3 hours of movies a day every day from netflix watch instantly!

    • Neoprimal says:

      You could easily stream even more than 3 hours from netflix a day for 30 days and still not hit the cap.

      What they mean is, don't sit there and download 300GB of data in torrents and not expect to pay for it. I'm not sure if people realize this, but that's what T1 dedicated lines are for. Rent one of those and get TRULY unlimited speed. Your own dedicated line with no caps and no one else. It'll only run you about a thousand a month for the speeds you're getting now - or you could scrape by at 7xx down, 3xx up for about $350.

      The point is, stop complaining before they do something rash....and they do have the power to. They're mostly monopolies in their respective areas, so if your internet gets locked down for abuse you're pretty much borked unless you can get DSL, which is nowhere close to Cable speeds.

      • PC_Tool says:

        Hell, you don't even need a T1, which is slower than molasses in January comparatively nowadays. Just sign up for their "Business" internet service. You pay a little more (nowehere near the thousand or so you'd pay for T1), get your own IP, the ability to host your own web/mail servers, and guess what? You can set up your torrent machine to download all day long if you want.

        It's amazing that most of these high-use types don't realize that such things exist, or for some bizarre reason believe they are entitled to these services even though it's clearly spelled out that running servers is forbidden on residential lines.

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