A bill too far: With iPad, AT&T attempts a triple-dip

Do you ever get the impression your wallet is being relentlessly sucked dry? Or that consumers are being expected to pay for an ever growing list of subscription-based services that, in a less profit-mad world, would likely be free?

Apple's gotten quite enough publicity from me and my colleagues over the last little while. So while I hate to harp on the iPad yet again this week, I can't let go of the fact that this particular introduction represents yet another step toward the deepening fiscal enslavement of consumers.

Information never wanted to be free

As an example, let's consider the price we pay to connect to the Internet. In the very beginning, we dialed the Internet by phone on a 1200 baud connection. (Anyone remember Telenet? Paying by the minute?) A long time later, in the Mosaic era, outside of community-funded Freenets or gamey-looking PCs at the local library, we paid ISPs to go online. Cost-per-minute rate plans soon gave way to unlimited access, of course, but we were still paying every month for the privilege of sucking the Internet through the data equivalent of a straw. Information superhighway, my eye.

Soon enough, DSL and cable-based high-speed connectivity shoved dial-up to the side, but that monthly subscription of around $20 to $30 nearly doubled in most cases. For some consumers, ISPs added insult to injury by charging extra for modem rental; in some European countries, governments charged license fees for using modems.

As the world mobilized and cell phones became mainstream consumer offerings, our monthly budgets made room for yet another bill. As cell phones morphed into smartphones, the voice-only invoice became a voice-and-data plan. In many cases (mine included) we were paying two amounts to the same service provider/carrier to be online at home and on the go.

Another device, another bill

In its higher-end 3G form, Apple's iPad threatens to add to the budgetary hurt by requiring yet another payment to access the very same Internet we've been paying for (twice) all along. Now, in fairness, we should thank AT&T for busting some of the old, consumer-unfriendly paradigms of the carrier biz. Its rate structure -- $15 a month for 250 MB of data and $30 for unlimited -- is a paradigm shift from the typically far more expensive smartphone-based plans. That it doesn't require a contract is an even more radical change from the traditional lock-in strategy that's hosed us all since this entire industry was first formed.

So as much as I want to congratulate AT&T for dropping the price and making it easier for us to opt in and opt out whenever we choose, I still think it's a crock. Thanks to Apple and its US carrier partner-in-crime, anyone who chooses to buy a 3G-capable iPad now faces a third monthly bill for the one Internet that his/her tax dollars funded oh-so-long-ago.

Am I the only one who thinks we should be paying once no matter how we connect? It can't be that radical a concept, can it?

Carmi Levy Wide Angle Zoom (v.2)Like television before it

In many respects, increasingly fee-based Internet access follows the broadcast television model. In the beginning, we picked signals out of the air for free. While the resulting experience was anything but home theater-like, it reflected the then-state-of-the-art, and was generally considered acceptable for its time. The arrival of cable distribution of those formerly free signals meant we no longer missed our favorite shows because an intense rainstorm blew the rooftop antenna out of alignment.

The relentless march of cable/satellite bills has far outstripped the rate of inflation in both Canada and the US for the past decade. It has also given pause to consumers who have grown weary of getting their pockets picked at every turn. Keep in mind the public technically owns the frequencies over which radio and television have traditionally been broadcast.

Fair is not free

I'm not saying AT&T should suddenly offer its 3G service for iPads, smartphones, netbooks or any other device for free. I'm also not suggesting that a carrier that builds out separate infrastructure for terrestrial and mobile data access shouldn't be able to define and manage separate revenue streams for each. Although we may not always have the most peaceful relationships with our carriers, we should show them a little love for choosing to do business in a very difficult sector. They make multi-billion-dollar bets on what technologies will be hot, and they deserve the opportunity to generate reasonable profits from those investments.

The key words here are "fair," "reasonable," and "balanced." Which is my politically correct way of saying that the profit motive should not be an excuse for companies to thinly slice nearly similar services, and then resell them to us as though they were unique. They are not, and despite the very different kinds of infrastructure that support terrestrial and mobile Internet users, at some point, pipes are pipes are pipes.

We expect greater value

If the still-with-us recession has taught us anything, it's to question the value of the things we purchase and consume. And if we don't feel we're receiving value for our investment, the recession has further emboldened us to challenge the status quo and push for something better. AT&T's iPad data pricing model may look like a great deal when compared to existing smartphone plans, but to an existing AT&T customer, it seems like an unnecessary cash grab. It's entirely fair to ask why one customer can't tap into one wireless account with more than one device, especially if at least one of those devices was purchased outright rather than with an up-front subsidy and a two- or three-year contract commitment.

I know I'm likely screaming in the wind here. I get that entire business models of market-dominating carriers are based on prodding the same people to spend more and more for month after month. I get that shareholders love this kind of thing and will spank growth-driven companies if they deviate from this model.

But the idealist in me likes to think that 2010 will be the year when the average consumer maxes out the average number of individual subscriptions for technology-related services, and that the amount we spend on things that should be either free, less expensive, or combined into simpler packages will ultimately begin to drop.

In this context, paying once again for 3G service on an iPad could be the biggest sucker's bet yet. Apple could end up changing the landscape again, only not in a way it had initially intended.

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.

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