AT&T Mandates Data Plans For Smartphones - InformationWeek

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8/24/2009
02:13 PM
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AT&T Mandates Data Plans For Smartphones

Palm, Windows Mobile, and Symbian smartphone users will have to sign up for the monthly data plan iPhone and BlackBerry users carry, instead of a lower-cost option.

New smartphone users on AT&T will have to sign up for a monthly data plan beginning in September, the second-largest U.S. wireless carrier said.

Apple iPhone and Research In Motion BlackBerry users are already required to sign up for a data plan that costs roughly $30 a month, but customers with other smartphones or unlocked devices are able to use a potentially cheaper data plan called MEdia Net. The MEdia Net plan has multiple tiers of pricing that can cost up to $2 per MB, and the wireless carrier said it will be changing that policy in order to give subscribers a more consistent billing experience.

"Smartphone users tend to consume a higher amount of data services, like advanced e-mail, mobile Web, applications, and more," AT&T said in an e-mailed statement to press. "Being able to take full advantage of these features without having to worry about a fluctuating or unusually high bill generally leads to greater customer satisfaction, so effective Sept. 6, smartphone customers will need to subscribe to a data plan, as the vast majority of customers already do."

The company did not specify how many smartphone users currently use the less-expensive data plan, but the move will likely provide a boost to AT&T's revenue. Smartphone users have higher average revenue per user than normal cell phone subscribers thanks to the mobile data plan and the propensity for these customers to use additional carrier services. The change will apply to new or renewed lines, and existing smartphone customers with MEdia Net will be able to stay with their current plans.

But smartphone users also carry a heavy cost for carriers, as the mobile operators usually pour hundreds of dollars of subsidies into each handset to make them affordable. For example, Apple's iPhone has been a major driver of new subscriber growth for AT&T, but the massive subsidies have hurt the carrier's margins a bit.


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