Techies Split Over AT&T's Plan to Curtail iPhone Customers' Data Use

The company may offer customers incentives to use less bandwith, dividing tech bloggers

Bloggers say AT&T just isn't getting the message: as the only official carrier of the iPhone, the company has been accused of leaving customers hanging, yearning for more reliable connectivity and data flow. Now AT&T's looking to offer "incentives" to get  iPhone customers to curb consumption of data-intensive operations such as streaming music and YouTube videos. Is it a sound plan? Technopundits are divided:

• Tough Call Business Week's Olga Kharif thinks that while basic supply-and-demand economics may be motivating the move, it is ultimately more likely to backfire and harm the company's business in the long run:

In a market where customers have grown accustomed to paying a single fee no matter how much data they consume, a switch by AT&T, the largest U.S. mobile-phone operator, may backfire. Analysts and consumer advocates say the move may curb demand for smartphones and wireless data products, stymie development by programmers who specialize in mobile applications, and push subscribers into the arms of rivals, such as Verizon Wireless, that currently charge flat fees.

• Customer Service Disconnect Robert X. Cringely at InfoWorld isn't surprised that AT&T is suggesting that it will limit customers' data access, given that its poor record pleasing some customers:

So, to recap: The only reason to pick AT&T as your wireless provider is the iPhone. In virtually every consumer survey, it lands at the bottom of the heap. It already charges an arm, a leg, and other vital bodily parts for a mandatory 'unlimited' data plan. Now it wants to charge by the megabyte and/or put in bandwidth caps. Why is the world's largest telecom being such a total asshat? Apparently it's doing everything it can to win the Worst Company Ever award.

• Might as Well Block Calls Similarly, True/Slant's Bill Barol argues that "Ma Bell" is a deliberately cruel mistress: "AT&T is guilty of almost unbelievable gall. Struggling with the success it's been forced to endure as the sole carrier of Apple's iPhone, the telephone giant is now actually thinking up ways to get customers to use its maxed-out network less. Among the possibilities: Bait-and-switch heavy data users off the unlimited plans they signed up for. This after years of promises, so far largely unrealized, that the company would build out its data network to handle demand."

• At Least It's Something to Satisfy Appetite for Bytes TechNewsWorld contributor Chris Maxcer calls the complaints of his fellow bloggers "whiny," yet he concedes they may have a point in calling the kettle (AT&T) black, saying the nation's largest wireless provider shouldn't "whine" about exceeding its anticipated iPhone numbers and their total data-usage. He compares AT&T to an "all you-can-eat Burrito" restaurant that becomes too popular for its own good.

Most of the seats in the restaurant are filled with parked burrito eaters, which naturally are crowding out other customers who come in, eat a burrito or two, and leave.

Is anyone going to watch their restaurant fail because the business environment had changed? No freakin' way. The business owner would find a way to change the all-you-can eat deal to something else, ideally by retaining customers, keeping them delighted, and remaining profitable.

• Actually, It Sounds Promising says GigaOm's Stacey Higginbotham. She explains that the new idea to offer an instant opt-in, multi-tiered data access plan is more carrot for customers than stick:

Carrots are different forms of congestion pricing, where folks can pay less for their mobile broadband access at certain times of the day, or get more if they download content when the network is empty. For example, buy one song, get one free between the hours of 10 p.m. and 6 a.m....

Under the assumption that mobile broadband is limited by spectrum constraints and reasonable network investment, I've no problems with carriers finding ways to get people to use it wisely, even if it means the end of streaming music to my hotel room over my Verizon Mi-Fi when I travel.