AT&T Ends Unlimited Data Pricing Even on the iPad

att_logo_250AT&T has ended unlimited data pricing on all devices including the iPad. The $30 unlimited plan has been replaced by the options of $15 for 200MB or $25 for 2GB. This may be good for AT&T in the short term but this is a long term negative for the consumer as data consumption is only growing as smartphone adoption increases. Also, Verizon is considering similar changes to their data plans. Already on most devices and plans, unlimited really meant 5GB.

Notable exceptions were AT&T’s plan for the iPad and Sprints upcoming 4G plan for the HTC EVO.

What does this really mean? It means that the HTC EVO seems a far superior choice than the new upcoming iPhone because Sprint’s plan is cheaper and unlimited. As it is Sprint’s plans have been better and cheaper than other carriers for a while but anybody who has experience with Sprint customer service a few years ago never wants to go back. After this change they might consider giving Sprint a second chance.

verizonAs a side effect (hoping for reduced data usage) of this AT&T expects to  introduce tethering for the iPhone at an extra $20 per month (without adding any more data, What?) to coincide with the launch of the new model. This has been a long time coming with promises of it ‘coming soon’ made three years ago when the original iPhone launched. US is the only country with tethering missing for the iPhone in the world. This should be have been an embarrassment for AT&T who also cannot get the phone to work right in major metros like New York.

Just a few days ago AT&T introduced new smartphone early termination fees. My assumption is that AT&T doesnt want a mass exodus to Verizon when a new iPhone launches on Verizon later this year or next year. But now I realized it also prevents people from defecting to Sprint when they get hit by data overages.

sprint-logo1Final conclusion is that this is bad news for the consumer, not so good news for AT&T and Apple (especially in case of the iPad) and impending bad news for Verizon when they introduce tiered pricing themselves. The only winner here is Sprint. Maybe. AT&T claims that the tiers are based on what people actually use but I’m not sure I believe that and going forward as we start watching vidoes etc. on our phones and mobile devices – I’ve been using Youtube often on my phone – things are only going to get worse.

As for stock, if you can handle the risk buy Sprint. It has been on a roll after recent upgrades but if the first to 4G works out for them, the stock might to well. If you are less risky buy Verizon because over the long term they will get an iPhone. I’m not so sure about AT&T’s prospects if they lose their iPhone exclusivity and they will also be the last to market with 4G. Even the CEO says the people will not switch to other providers because they are locked in and not because AT&T will provide better service.

Disclosure: I own no stock in any wireless company. I do own Apple stock but no Apple products. I am happy with my Windows Mobile HTC Touch Pro which can be tethered and also has wifi hotspot.

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