AT&T Data Caps Spell Doom - InformationWeek
IoT
IoT
Mobile // Mobile Devices
Commentary
6/3/2010
06:20 PM
Thomas Claburn
Thomas Claburn
Commentary
Connect Directly
Google+
LinkedIn
Twitter
RSS
E-Mail
50%
50%
RELATED EVENTS
Dun & Bradstreet CAO Discusses Her Roll & The Skills Needed to Do the Job
Jul 26, 2017
LWhat does a chief analytics officer do each day? To help us answer that question we welcome Dun & ...Read More>>

AT&T Data Caps Spell Doom

AT&T on Wednesday ended the all-you-can-eat data buffet for iPhone users by announcing new wireless data plans with monthly data limits. Web companies will suffer as a result.

AT&T on Wednesday ended the all-you-can-eat data buffet for iPhone users by announcing new wireless data plans with monthly data limits. Web companies will suffer as a result.The plans provide 200 megabytes (MB) of data and 2 gigabytes (GB) of data for $15 and $25 per month respectively. That sounds pretty good, given that 98% of AT&T customers use less than 2 GB per month.

But without flat rate bandwidth, every online action invites mental calculation about the worth of the activity. And it will turn out that a lot of online activity just isn't worth paying for. Even if the cost is trivial, metered usage will create mental drag that's likely to discourage Web use on AT&T mobile devices.

This is one of the reasons that micro-transactions have proven to be so problematic. It's too difficult to determine whether, say, a news article is worth a ten cent reading charge, so those invited to make that calculation tend to balk rather than pay. The cost-benefit analysis we all go through when we are asked to pay for something just becomes too murky.

This is doubly true for ads. Users will be paying for the bandwidth to deliver marketers' pitches.

When the ads come as part of a flat rate package, that's not a problem. But when every electronic bit counts toward one's data limit, people are going to start demanding refunds for ad bandwidth, or ad blocking software.

That may be just what AT&T wants: It could charge advertisers a premium to deliver ads that don't count toward viewers' data totals.

Two GB is enough, AT&T says "to send/receive 10,000 emails (no attachments), plus send/receive 1,500 emails with attachments, plus view 4,000 Web pages, plus post 500 photos to social media sites, plus watch 200 minutes of streaming video."

iPhone user consume an average of 273 MBs of data per month, according to Consumer Reports.

View a few movies using your phone and you've hit your monthly limit. Suddenly, innovative services that involve streaming video and music, video chat, VoIP calling, and other data-heavy activities like live streaming look a lot more difficult on mobile devices.

The Enterprise 2.0 Conference is the largest gathering for people ready to connect teams, and harness collective intelligence with social tools and 2.0 technologies. It happens in Boston, June 14-17.Find out more here.

Comment  | 
Print  | 
More Insights
Comments
Newest First  |  Oldest First  |  Threaded View
How Enterprises Are Attacking the IT Security Enterprise
How Enterprises Are Attacking the IT Security Enterprise
To learn more about what organizations are doing to tackle attacks and threats we surveyed a group of 300 IT and infosec professionals to find out what their biggest IT security challenges are and what they're doing to defend against today's threats. Download the report to see what they're saying.
Register for InformationWeek Newsletters
White Papers
Current Issue
IT Strategies to Conquer the Cloud
Chances are your organization is adopting cloud computing in one way or another -- or in multiple ways. Understanding the skills you need and how cloud affects IT operations and networking will help you adapt.
Video
Slideshows
Twitter Feed
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.
Flash Poll