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AT&T Raising Data Rates and Allowances
By Adam DickterPosted: January 19, 2012 11:58am PST
"The [new AT&T] data plans address the increased data usage that smartphone users are experiencing with increased data thresholds," said analyst William Ho. "For new consumers, they'll have more data usage relative to older plans but at the same time the pricing increases" if they sign up for an AT&T data plan beginning Sunday.
For heavy data users, AT&T's new plans for smartphones and tablets offer a good value that could help avoid expensive overages. But those who prefer the older plans still have a short window: The price increase goes into effect on Sunday. More Coin, More Bytes The nation's second biggest wireless carrier announced Thursday that under the new rates, 300 megabytes of data will now cost $20 a month, 3 gigabytes will cost $30, and 5 GB will set you back $50, with mobile hotspot tethering capability thrown in. Each gigabyte over the limit will cost $10 for the latter two plans. For tablets, those on the 300 MB plan can switch to 600 MB for $20, or choose the 3 GB and or 5 GB plans. Existing customers can continue paying $15 for 200 MB, $25 for 2 GB and $45 for 5 GB of data, though a hotspot connection would add another $5, making it the same as the new plan. "Given that these changes happen on Sunday, consumers who want the lower priced entry point should look at adopting before the price increases," said wireless analyst William Ho of Current Analysis. "As before, unlimited data plan users or users with the older price points are grandfathered." The change comes as AT&T struggles to adapt after losing an early advantage in the smartphone market. It was the first, and for three years the only, carrier to sell Apple's iPhone. Like other carriers, AT&T is also coping with soaring demand as data vastly overtakes voice communication in the level of traffic on wireless networks. But data usage is inconsistent. Earlier this month market research firm Arieso released a study suggesting that just 1 percent of mobile Internet users are hogging a whopping 50 percent of all the data surging through wireless connections. "Customers are using more data than ever before," said David Christopher, chief marketing officer, for AT&T Mobility and Consumer Markets. "Our new plans are driven by this increasing demand in a highly competitive environment, and continue to deliver a great value to customers, especially as we continue our 4G LTE deployment." FCC Chairman Julius Genachowski, speaking this month at the Consumer Electronics Show in Las Vegas, warned that the data explosion will call for a huge increase in spectrum demand, and carriers will have to find a way to buy more bandwidth from cable operators and other license holders. Increased Thresholds AT&T recently launched its high-speed data, long-term evolution network and will have to work hard to keep up with demand as it introduces more 4G smartphones and other devices to avoid incurring embarrassing system outages such as those faced by top rival Verizon Wireless. "The [new] data plans address the increased data usage that smartphone users are experiencing with increased data thresholds," said Ho of Current Analysis. "For new consumers, they'll have more data usage relative to older plans but at the same time the pricing increases." He added that heavy data users will be less likely to contend with data plan overages as before. Those better suited for the old rates had better decide quickly, he said. Verizon Wireless recently ran a promotion offering double the data in each price category. That expired Jan. 15.
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