Mobile // Mobile Devices
Commentary
12/5/2013
10:06 AM
Eric Zeman
Eric Zeman
Commentary
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AT&T Cuts Fees For BYOD Customers

AT&T cuts monthly fees for customers who pay off their device or bring their own.

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AT&T must be feeling the heat from T-Mobile. T-Mobile has pursued AT&T's customers aggressively this year with new rates and device financing. AT&T offered a tempered response several months ago, but didn't go far enough. AT&T introduced on Thursday new monthly service plans and device payment options that more closely match those of T-Mobile.

The plans, which AT&T is calling Mobile Share Value Plans, build on the framework it launched over the summer. The idea is that people pay for a basic set of services -- minutes, messaging, data -- and then add devices to that service. All the plans offer unlimited voice minutes, unlimited messaging, unlimited FaceTime, and unlimited access to AT&T WiFi, which are then paired with finite data allotments. The smallest amount of data available is 300 MB per month and the most is 50 GB.

First, AT&T has altered the monthly pricing for the data allotments. Many of the allotments cost the same, though some cost less and some cost more. Under the new plans, the 300-MB option costs $20 per month, with the 1-GB option following at $45, 2 GB at $55, 4 GB at $70, 6 GB at $80, 8 GB at $90, 10 GB at $100, and on up to 50 GB at $375.

Second, AT&T has changed how much it costs to add devices to these plans. Previously, AT&T charged $30 to add a feature phone to any of these plans and between $35 and $50 to add a smartphone to any of these plans. Moving forward, feature phones cost only $20, and smartphones won't cost more than $40. (Keep in mind these device charges are per line in addition to the service fee.)

[Afraid your phone will be stolen? Read 10 Defenses Against Smartphone Theft.]

Third, AT&T saw the light and realized it can't charge customers twice for their handsets (which it was doing under the previous plans). From now on, customers who complete their two-year contract (and effectively pay off their device) will see their monthly service charge automatically drop by $15 to $25. Customers who come to AT&T with their own phone will only pay the $25 monthly fee per line (on top of the basic service charge), as will customers who choose to pay full price for their device, and those who choose one of AT&T's Next device installment plans. This is critical.

One of the daring moves made by T-Mobile earlier this year was to separate the cost of the device from the cost of the service. Though the monthly bill was about the same, it provided a much clearer view about how much smartphones really cost. Customers who bring their own phone to T-Mobile or pay their phone off enjoy a monthly savings of approximately $20. AT&T wasn't matching this monthly savings until now. Unhooking device subsidies from the monthly service plan is a major win for AT&T customers.

(Source: Wikimedia Commons)

The last component revealed by AT&T on Thursday is a new option for device financing. Previously, it offered either 12 months or 24 months. Now, an 18-month option is available. This lets people spread out their device payments over the amount of time that works best for them.

Parsing through the various options might require an accounting degree, but AT&T says most customers can save between $10 and $25 per month with the new plans. Savings hover at $15 per month for customers who select plans with lower data allotments, but range up to $50 the more data one chooses.

AT&T's new Mobile Share Value Plans go into effect on December 8. They will be available to all new customers and to existing customers who contact customer care.

Making decisions based on flashy macro trends while ignoring "little data" fundamentals is a recipe for failure. Also in the new, all-digital Blinded By Big Data issue of InformationWeek: How Coke Bottling's CIO manages mobile strategy. (Free registration required.)

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ZachM969
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ZachM969,
User Rank: Apprentice
12/5/2013 | 4:26:27 PM
Some Great Tablets and SmartPhones
One of the best U.S. sites for No-Contract Tablets and Smartphones that work on the AT&T and Straight Talk wireless networks is -- TabletSprint

The new 8.9" Pipo M7 Pro - 3G HSPA+ tablet is on sale for $279 -- with built-in SIM card slot that works with any AT&T wireless plan as well as Straight Talk plans (which now use the AT&T Network).

The Pipo M7 Pro - 3G tablet offers high end specs that compare to the new Nexus 7 - plus its larger 8.9-inch screen makes it one of the best values on a tablet this holiday season.

The Pipo M9 Pro - 3G tablet offers a 10-inch size with the same high-end specs, available for $309 --  and in addition is one of the first tablets with both Internet & Voice Calling capability... which works well with a bluetooth headset to make phone calls.

Also available through TabletSprint is one of the best budget priced quad core phones on the market - the THL W100S (priced at $164). complete specs available through their site.

Many other new models to launch this month  and  available through TabletSprint are worth checking out, including the new SmartQ Z-Watch to launch last week, for $155 – which compares to the new Samsung smartwatch, but nearly half the price.
walkercctv
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walkercctv,
User Rank: Apprentice
12/5/2013 | 6:53:52 PM
Re: Some Great Tablets and SmartPhones
The logic in this article is flawed.  Customers enter into a 2 year contract in order to save mony on the inital device purchase, instead of buying an iPhone for $649 they get it for $199.  When your contract ends you have satisfied the subsidy.  This has nothing to do with the fact that you are no longer under contract so you shouldn't be charged extra, this is simply a move by AT&T to be cost competitive with the competition.
Eric Zeman
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Eric Zeman,
User Rank: Strategist
12/6/2013 | 8:46:03 AM
Re: Some Great Tablets and SmartPhones
Thanks for your note. I understand your point of view in that, yes, most people buy phones on-contract to get the subsidized price. The monthly subsidy averages about $20 per month over the lifetime of a contract. The issue here is that customers who satisfy the contract and pay off their device after two years didn't receive a discount on their service. They continued to pay the same monthly fee, which includes the $20 subsidy even though the phone is paid for. This is where AT&T and others were ripping customers off. That device subsidy should have gone away at the end of the contract, but didn't. Now, with these new plans, it does. 

Speaking personally, I will never sign a contract with a wireless network operator again. I don't mind paying full price for phones, but in return I expect my service to cost a little less. 
Kristin Burnham
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Kristin Burnham,
User Rank: Author
12/6/2013 | 9:47:02 PM
Competition is good
It's nice to see AT&T getting more competitive. It can only be good news for consumers (especially around the holiday season).
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