If Flat-Rate Mobile Data Plans Are So Bad, Why Do Operators Keep Launching New Ones?

from the playing-both-sides dept

On its quarterly conference call, AT&T's CFO once again talked up how the company needed to move away from flat-rate mobile data plans because its networks are being overwhelmed by traffic from a small percentage of its users. This rhetoric -- which is really just trying to warm up the market for future price increases -- comes despite figures showing that AT&T's data revenues are increasing, while its network investment is decreasing. On some level, if an operator like AT&T wants to try to force through higher prices by increased flat rates or usage-based pricing, go right ahead; we'll see just how the market reacts. But all of their talk about their poor overwhelmed networks would go down a little bit better if they wouldn't decry flat-rate plans in situations like this, while they launch cheap flat-rate unlimited plans at the same time, as AT&T has done for the iPad 3G. If AT&T's network is already taxed and cheap data plans are to blame, why launch another one on a device that's built to consume data?

Filed Under: data plans, flat rate
Companies: at&t


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  1. icon
    Derek Kerton (profile), 22 Apr 2010 @ 2:26pm

    Re: Re: World of Warcraft

    The carriers also do the myopic thing of basing their pricing and estimates on CURRENT data use patterns. They don't do enough to predict what kinds of new apps will emerge, whether people will change their data consumption, and the impact this will have on their pricing and "unlimited" marketing.

    They should have never started with "unlimited data". The consumer naturally wants it, and they've trained consumers to expect it. A problem of their own making.

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