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December 10, 2009

AT&T rethinks unlimited iPhone data plans

Posted: 02:37 PM ET

Unlimited iPhone data plans and popular high-bandwidth video offerings are causing headaches for AT&T. In some saturated markets, such as New York City and San Francisco, the company's wireless network is unable to keep up with demand and transfers slow to a crawl.

[cnn-photo-caption image= caption="AT&T President and CEO of Mobility and Consumer Markets Ralph de la Vega"]According to the Wall Street Journal, AT&T's head of consumer services Ralph de la Vega blames high-bandwidth users for these network shortages, and, in a recent meeting with investors, hinted at the end of unlimited data packages.

“This is going to get fixed,” Mr. de la Vega said. “In both of those markets, I am very confident that you’re going to see significant progress.”

With about 3 percent of smartphone customers driving 40 percent of data traffic, AT&T is considering incentives to keep those subscribers from hampering the experience for everyone else, he said.

De la Vega did not elaborate on what "incentives" AT&T plans to enact, but you can bet the agenda will have more in common with data caps and speed limits than free toasters.

Bandwidth-hungry iPhones may be the cause of AT&T's network problems, but they are hardly to blame. iPhone users are forced into unlimited data packages costing at least $30 a month. I don't think AT&T has any right to complain when a few of those users fully utilize their purchase.

Who do you feel is responsible for the struggling wireless networks? AT&T, high-bandwidth users, or both?

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Filed under: Apple • cell phones • consumer tech • iPhone • Uncategorized

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John   December 19th, 2009 5:54 pm ET

It's a contract. ATT can't modify existing contract. If leaders at ATT can't handle this, they don't deserve those extraorbitant bonuses or none at all for their incompetent forsight.

Arod   December 19th, 2009 9:11 pm ET

It is AT@T'S Fault for not having a reliable network like Verizon!!!!!!!!!! All the I Phone users just need to get an Android..and go with Verizon..who 1-they spend over a billion dollars on their network...and never have a problem with like their CEO stating that they have to cut plans that they offered to cust's like thier unlimited data plans.also that you have to send back to APPLE every time you have a probelm with the I PHONE..the ANDROID has a seperate battery that you can take out and is servicable through Verizon and Android ...they just dont spend enough money or invest into thier own self worth for the market!!!!!..Also..who wouldnt want an platform..that the user can make an app and apply to the device..with no worries of getting charged for it..also you can put your own music on the ANDROID and use it for your me Verizon has the best Network hands down!!!!

Moe   December 20th, 2009 9:09 am ET

What people don't realize is that the power & capabilty of the iphone was probably unexpected or unrealized by, I'll say, the wireless network for now. Do you not think that as smart as Steve Jobs & the Apple Engineers are, in developing the iphone, that they have not equally thought out which network would be best suited for the device. It's like an unexperienced high school kid, getting a Lamborghini for Christmas; the power & capability of the car is unrealized, & therefore the kid is unable to drive the car to it's full potential.

Now due to the number of iphone's, with unlimited data access, the system becomes clogged, a dilemna that Verizon, Sprint, T-Mobile, etc... would also have experienced, if they had the iphone exclusively, like AT&T does. AT&T just happens to be in the spotlight on this one, because yes, their network can not (at this time) handle the demand of the iphone & it's users, plus all of their other tasks, BUT, as I previously stated, which network can. Verizon might as well face the fact, that if they were in AT&T shoes, they would have the same problem. Then it would be "Verizon sucks", "Can't wait until my contract is up", etc...

Kevin   December 20th, 2009 11:41 am ET

I have a jailbroken Iphone and won't hesitate to take it to verizon. I never liked the fact they rammed the so called unlimited data package down our throat anyway. If they make people buy it, they shouldn't be surprised when they use it!

JayG CT   December 20th, 2009 12:48 pm ET

AT&T is awful. Verizon has way better customer service and a better variety of phones. Why go with AT&T for 1 product like the IPhone when you can goto Verizon and get multiple different DROIDS or even the Storm2. It is not the Iphone that is clogging up AT&T's network, its the fact that they have no 3G network! By the time they complete there 3G across the country Verizon and Sprint will be done with 4G! how lame is that!

Nativebutterfly   December 20th, 2009 2:51 pm ET

Exactly what (Gregory) said. Duh, all companies only give you 5gb for laptop datacard for $50 to $60 so, what makes anyone think they can have a 'unlimited" data plan, with an Iphone, and not be penalized for going over?

John   December 20th, 2009 11:25 pm ET

Everybody to include AT&T wanted the business from smart phones, people who buy them want to be able to use them, but yet none of the companies want to make the investment to support the user they want most....hmmm. Guess that's why unlocking your I-phone and giving yourself the ability to choose the network that actually works is so popular.

Grover W. Denver CO   December 21st, 2009 12:58 am ET

Personally I don't use more than 3 hours of data bandwidth per month. It was quite novel to able to read my e-mail away from my home desktop, but I usually do most of my responding to e-mail @ home on my high speed (20mps) pipe on my home PC. I'd like to pay $15 per month for data and live with a smaller usage window.
Otherwise, when my iPhone deal with AT&T expires, I'm going back to a plan that does NOT include Data usage and my iPhone can be jail broken and become just a plain phone.
I sure hope AT&T is listening.

Julia labaire   December 21st, 2009 1:54 am ET

AT&T is the worst!! I had t- mobile for 10 yrs only left for the iPhone…Poor customer service, Drop calls, lack of coverage now reduced service, frozen phone! T-mobile just made the unlimited plan 49.99 a month and I never had a bad thing to say about them! Great customer service too!

Michael Hill   December 21st, 2009 3:36 am ET

If they take away the unlimitied package, many users will abandon AT&T and switch to another network that can support ALL of its users, thus AT&T will be hurting themselves. They should just enhance the network to keep up with the demand.

KFree   December 21st, 2009 6:34 am ET

I am disappointed in AT&T. I think that Apple should end its exclusive contract with this company and open up the competition to other companies. I love the iPhone, but could live without the service.

Dom   December 21st, 2009 7:06 am ET

This is what happens when you have a bunch of greedy @ssholes in charge of a corporation who don't properly plan ahead. What did they think was going to happen? It's 100% their fault for not making sure they'd be able to handle the volume of data transfers. I will laugh when they lose a ton of subscribers over this.

Deb   December 21st, 2009 10:59 am ET

AT&T shouldn't offer what it can't handle. And I will be one of many unhappy campers if they try to take away my unlimited data package. I signed up for this plan and don't plan on changing it. This would just give me one more reason to hope that Verizon picks up the iPhone soon.

Tom   December 21st, 2009 12:20 pm ET

If they take away my unlimited data from my iphone, I am leaving to the droid with verizon. I love my iphone so much but without unlimited data, it wouldn't be the same!

Richard   December 21st, 2009 3:06 pm ET

God what a bunch of whiners. I've never seen so many complaints about AT&T. Now maybe it's because I don't live in LA or NY or SF but my wife and I (both with iPhone 3Gs phones) almost never have dropped calls. And I really mean that, almost never. Now we don't have the greatest coverage (we live in a very remote part of southeast AZ) but even being 20 miles from Tucson we still can use our phones (closest tower is at least 8 miles away). And in town we almost always have full 3G service. I've never run into any issues with customer service, they have always been very helpful with us. We love our iPhones and I have no desire to move to another carrier.

Now, having said that, I would not care to have my data plan price increase or have a cap put on it. I have to deal with that already with Hughes Satelite Internet. Now, if you want to talk about REALLY bad service...

Joe Sorge   December 21st, 2009 4:23 pm ET

I believe the problem is AT&T doesn't have the towers to support the amounts of bandwidth. If AT&T would either increase their towers or the bandwidth capabilities, every PDA customer would be increadibly happy. Also talking about contracts, if AT&T would either merge with another company and take on their towers, that would be another option. The only last option would be to develop a kind of contract possibly with Verizon or another large company to "borrow" or use the towers of the other comapny and share the increased wealth.

~Tami~   December 21st, 2009 5:45 pm ET

AT&T never had the coverage or the bandwidth to adequately carry the iPhone. Verizon and Sprint have been and continue to be vastly superior to AT&T in the those two aspects which are the only two that truly matter. Making it mandatory to have the $30 data plan is merely adding insult to injury.
The only reason AT&T has customers is because Apple made a proprietary agreement for the iPhone. Now Apple is seeing the error of that way and opening up the iPhone to vendors who will help ensure that the cell phone service lives up to the Apple name.

Robert   December 21st, 2009 9:11 pm ET

You're using your iPhone the way we told you you could?


AT&T only had $ 119,300,000,000.00 in revenue last year.
(whining) We can't afford to more bandwdith.

BAD USER ! ! !

thomas rhodes   December 21st, 2009 11:16 pm ET

cant believe att is blaming the customer,when its their equipment that cant handle the load.

Menno Aartsen   December 22nd, 2009 12:52 am ET

I have a hard time believing those numbers. There are hundreds of 3G phones, they have been around for years, fast data is the only reason someone would get a 3G phone, and these complaints (they come from the UK too, the rest of the world is less interested in the iPhone) are specific to the Apple product. It is therefore most likely the cause is the iPhone's design, a conclusion that makes a lot of sense if you take into consideration that the iPhone is the only 3G phone made by a manufacturer that has no experience designing and manufacturing cellphones. Add to that Apple's reluctance to conform to the GSM standards all other manufacturers adhere to, and you have your answer.

Scuba Steve   December 22nd, 2009 5:23 am ET

Perhaps ATT should put more $$ into the services they are defending rather than wasting it on the washed up actor they are using to promote them. Then again, I guess the $10 wouldn't have made much'a difference. XD

Just another case of writing a check that yo a** can't cash!! Pitiful blaming the consumer. You know when a company is complaining about too much business the customer is obviously not the focus...but rather the stockholders my friends. After all, the country is rapidly perpetuating the art of the rich getting richer while to poor just keep gettin' poorer...

Kyan Hartley   December 22nd, 2009 11:52 am ET

As an iPhone user.. should AT&T drop its unlimited data plans for the iPhone, which are already rather expensive @ $30/month, causing my bill to be over $100/month... I would rather pay the $175 cancellation fee and terminate my service rather than getting the shaft from a company I've been loyal to for years. I'm interested to see what they do.

Richard   December 22nd, 2009 12:41 pm ET

I have a original iPhone 8 gig. In Mexico, Canada, and London I never loose a call and have great reception even in the metro. Downloads are fast and using the phone part of my iPhone is a joy. In the USA it is a mess and I sometime even have a old Nokia as a backup. 2 months ago I switched my iPhone to t-Mobile and even though I do not have the internet speed I have in other countries I do have a perfect working cellphone service with the phone part of my iPhone.

Many people have had the same experience with their iPhone. AT&T is obviously the issue.

Gregg   December 22nd, 2009 1:30 pm ET

Either limit or increase cost and I am so outta here, I made the mistake of leaving Verizon, really hope Verizon gets the iphone next summer like the rumor says.

Lomlom   December 22nd, 2009 1:51 pm ET

ATT !!! I hope somneone from ATT reads this:

You and your company sucks for even hinting this idea as a way to tackle your network issues. I hope it is just a lie for your investors (prob not). Get ready to see your customers walk.

Moreover, I am getting fed up with these data plans and so called smart phones. My friends are gradually switching to Cricket in Houston for everything unlimited at $60/month and that includes unlimited international calls to anywhere..Europe and Africa!!! Funny thing is they can get most important features (voice, text, web) on your Iphone or blackberry working at Cricket.

Ryan   December 22nd, 2009 2:16 pm ET

I hope they implement this mid-contract so I can cancel my Iphone contract without a fee! That'd be sweet!! Then I will jailbreak it and go to a more reasonable carrier or just sell it on eBay 😉

BessH5   December 22nd, 2009 4:18 pm ET

Ok; I have an iPhone, I use it for work, and I do use the internet. Yes, I am paying more than I should. As far as coverage; I have had verizon and it was expensive and horrible, I had cingular and that was worse, now I am back to AT&T. I had coverage when other people did not like in the middle of the San Bernadino mountains and at LaJolle Cove.

I love the phone, I have so far some issues (not a great deal) with the internet being "slow". However, even the Verizon network home computer could not connect. I agree with one writer; all the carriers will have problems with the bandwidth.
Has anyone on this blog contacted AT&T directly? I think I will give them a jingle on the verizon home phone

Leslie   December 22nd, 2009 5:09 pm ET

AT&T complaining about IPHONE users using the network too much, is like Ferarri complaining that owners driver their cars too fast. Put some money back into building up the network...stop complaining AT&T..this is the monster you created. If in fact they do cap the plan..i will leave.

Brad   December 22nd, 2009 7:47 pm ET

This is so stupid for AT&T to do I mean come on this has got to be one of the biggest messups they could do how many people have I-phones and they are willing to go ok a few users are ruining it for everyone so everyone has to pay for a service they are already paying to much for I mean if people want to start messing with AT&T then everyone should stop paying for text and just use the email service if everyone did that then they would be boned because lets face it that 20 dollars is free for them when you think about it. As for if AT&T does this I will just drop them, so if they want to see the bulk of their money exiting them faster then a fat kid runs after cake then by all means do it but if they want to do what is right how about give everyone what they are paying for instead of bending them over like they have been.

lance   December 23rd, 2009 2:07 am ET

boy o boy am i glad with my t-mobile service, as well as my g1 droid phone. its so much better then the iphone. haha have fun suckers :]

Anthony   December 23rd, 2009 9:08 am ET

you people are crazy, Verizon charges the same amount for data every month!

Conner   December 23rd, 2009 10:37 am ET

Love my iphone. Disgusted with AT&T's service. I rarely get through a phone conversation that doesn't leave me talking to the air – while the person I was talking to has disappeared from the call. Nightmare. If they do upcharge for data usage – I am done. AT&T will then be talking to the air...

Robert   December 23rd, 2009 11:12 am ET

I just bought and iphone last week and was aware of the Mandatory 30 unlimited data plan. If they are going to LIMIT the amount of data/bandwith that can be used per user, they better atleast Cut the price in Half, or use all that money we are paying to upgrade their servers/service....They CANNOT limit the bandwith and keep the Current price, that is NOT what everyone agreed to when signing those contracts.

Agent Bacardi   December 23rd, 2009 12:20 pm ET

I left Verizon after 7 years and joined AT&T for the iPhone. It's like marrying the girl of your dreams and then discovering her parents are the devil's spawn. I love my phone, but AT&T's service has been terribly poor. I've considered jailbreaking my iPhone and moving to another service once my contract is up.

If they persist in blaming their customers because they did not take the windfall revenue from new iPhone contracts and reinvest in better infrastructure, then I will certainly leave. Major corporations whining about their customers actually USING contractually guaranteed service is beyond the pale. In which business school did these executives learn that their companies deserve money for nothing??

Lin McNaughton   December 23rd, 2009 2:17 pm ET

OK AT&T, So you think that the end of unlimited data plans is still a good idea? I only read a small amount of the comments and it does not take rocket science to know that it is a really bad idea to go backwards! I remember the days of "limited" net service and how expensive that was and I will be just one of thousands (my guess) that will also change carriers. I only recently went back to AT&T after several years of using other carriers and only then because of helping save other people money since I had an unlimited use plan 24/7 which even though they did'nt have the highly touted 3G network, I have really not noticed much of a difference and I am a "techie" and I notice and look for those things.
So if you decide to go ahead with this I think you will show significant improvement allright, but only due to the loss of huge numbers of users that will certainly go elsewhere, Iphone or not.

Jeff   December 23rd, 2009 2:39 pm ET

I too am completely disgusted by the notion that AT&T would even consider uping the monthly charge for a service exclusive to them. Honestly, I have had my 3Gs for almost a month and I am blazing fast. Not a dropped call.

So considering about 89% of the people replying to this list would leave AT&T and go to Verizon for the you really REALLY think Verizon could even handle the amount of data saturating their network. Even better, if Verizon gets the iPhone..that with the Droid..all I forsee is screaching hault

don't get me wrong, I will jump ship in a heartbeat, after 12 years and then be the first one to sign a class action lawsuit for breaking a contractual agreement

Crazyi   December 23rd, 2009 2:53 pm ET

Telephony companies are to blame. It's not like users are polluting the air space or dumping bad data into the ocean. There is unlimited band width to be created. This is AT&T's house of cards they built and they are the ones selling a product. Just Fix it. This why those big AT&T Exec boys & girls get paid so much; they're suppose to forcast sales and usage and make it happen. Don't point the finger at the buyer for using your product, that's just crazy.

Taimoor   December 23rd, 2009 4:38 pm ET

The answer is SPRINT – most dependable network with the best device lineup. Try the new droids offered by S.

Hanku   December 23rd, 2009 8:57 pm ET

wow! I have had the iPhone for a year now along with the mandatory unlimited data plan. I use it "unlimitedly" I've had less than 5 dropped calls and they were to/from a friend on TMobile. The dropped calls stopped when they got their iPhone and got away from TMobile. I've not had the phone unlocked, but use it in China with a China Unicom SIM card. AT&T said it wouldn't work and I'd have to pay $2.29 a minute for calls and $20 a meg for data. I guess I was dumb enough to try it anyway. A verizon phone is not SIM based (or at least wasn't when I left them in 2004) and doesn't allow this method to use local SIM cards. Verizon extended my contract every time I called customer LACK OF service to the point that my 2 year contract signed in 2003 was due to expire in 2009 when I paid the cancellation fees in 2004. AT&T HAS their problems, however Tmobile has no reception coverage but they're cheap, Verizon has the best reception usually but miserable customer appreciation and limited hardware availability. The iPhone or a similar device will soon be available from any provider soon and we can decide which monster to feed.

Mike   December 23rd, 2009 10:43 pm ET

Oh calm down people. First off ATT is upgrading their network as fast as they can, they just need to get through the transition. Second, CNN is implying caps – ATT hasn't said it and they probably won't do it. There are other options. I suspect ATT will prioritize data requests based on usage – i.e. the more you use, the slower it gets. That way, normal users see improved service and the super high bandwidth users can switch over the Verizon and clog up their networks.

Sophak   December 24th, 2009 2:22 am ET

If you allow other carries to have the iPhone then you spread the usage over multiple networks. It's that simple. The iPhone and all of it's glory is made to use data and in today's nature of always being connected and instant at your finger type stuff, the network is the problem not the user. You REQUIRE people to buy the data package and WHAT believe they weren't going to use it? If I am going into a Buffet; I'm not going to hold back. It's also value and getting my money worth.

Romy   December 24th, 2009 8:34 am ET

ATT is to blame, they charge a huge amount and don't provide the infrastructure to use it the way it was designed and advetised. If they alienate their customer, I am sure T-Mobile can accept the chipped iPhone. Who would Apple side with, the people who buy their product of course. Its about the dollars and customer loyalty. Apople has to be careful since Android now and Windows Mobile is picking up slowly again. Bad move ATT, Hopefully the Apple Tablet will be free reign. I'll just jalbreak that one too.

danny   December 24th, 2009 9:18 am ET

Won't buy an I phone till its available for Verizon. Iv'e had AT&T and wo'nt go back

Boz   December 24th, 2009 10:57 am ET

Who is to blame? Apple and AT&T. A chunk of that 3 percent is probably made up of people who are forced to download via 3G because they can't get their wifi to work properly. Poor Apple support stil hasn't clarified its support cases to address all of the these cases. AT&T for forcing people into the service, not properly planning capacity, over-charging for text as so many U.S. carriers do, and then expecting people not to use the service. Why blame end users for using something they are over-charged for? One can feed an American family or a small village for what these plans cost. Moved by holiday spirit, I dropped the Grinch known as AT&T, went with a plan one-fifth the cost, and donated the difference to charity – 2500 bucks per year. I'm a world happier for having cut my relationship with companies that behave like AT&T.

D   December 24th, 2009 11:22 pm ET

AT&T should limit the 3% if that group is taking 40% of the network with them. It makes sense from any perspective: the customer, the business, and potential customers. If that 3% wants the larger bandwidth, they can pay for it. We all know who that 3% really is...

Don Triplett   December 26th, 2009 11:44 am ET

I think AT&T has been raping their customers long enough. They forced us into these plans and now they should be required to give us the services we've been paying for. I have never experienced such horrible cell phone service as what we have to deal with here in Dallas, Texas!!!! It's an embarrassment. If they didn't have the iPhone I'd have been gone long ago!!!! If another carrier gets the iphone AT&T will see hundreds of thousands of their customers jump ship!!!!

Grover W. Denver CO   December 26th, 2009 10:32 pm ET

I'd be happy with 15.00 data plan. If I don't see one, I'll be bricking my iPhone @ the end my current contract.

In a world that doesnt,   December 28th, 2009 1:48 am ET

hope verizon gets iphone, and keeps their smart phone data charge at 30$
+ 4g iphone, on A new network? TBH kickass way to start off 2010

Stephen Manning   December 29th, 2009 4:25 am ET

One (1) week after my new iphone purchase and the switch from Sprint, I decided to contact AT&T regarding dropped calls. I was told by a AT&T on-line rep that they are currently aware of the matter but (DID NOT) have a solution. Then… very quietly added "maybe (summer 2010) would be a better time to consider an iphone purchase."
Someone frauduantely represented themselves when submitting for this service bid for Apple – If you would rather work for AT&T's R&D dept. for "free" while Frequently reporting dropped calls using the app "Mark The Spot" then great. But for now, I need a capable phone service provider. AT&T DEFINITELY jumped the gun on this service agreement with Apple.
SPRINT provided my cellular needs for 15 yrs. and the only reason for leaving was to enjoy the iphone's super-flirty, super-friendly interface. Steve M. Hollywood, CA.

Evan   December 29th, 2009 12:29 pm ET

Really? At&t is blaming users for a product that they sell and advertise that they are the best for? Sounds to me like they weren't prepared for the job. How can you make it a policy to have a data plan and then blame the consumers for using it? Sounds like the boys over at At&t have some thinking to do. I for one love my iphone and use it all day every day, 98% of the time on a wifi network. Go ahead guys raise the plan and be ready for the fallout. I hope that many consumers such as I will jump ship as soon as we start getting even more ripped off. Should they up the charges and then try to charge us for breaking our contract remind them that they broke theirs first. I hear class action lawsuits in the making.

Ivy   January 9th, 2010 1:12 am ET

I just bought an Iphone 3Gs for $651.46 and when I called customer service of AT&T they said even if I paid the full price they are going to charge me for it because of their new policy. I told them I dont need data coz I only go to school which has a free wifi and at home also has wifi. At work I have internet. I only like the Iphone. Now it's just showing that I dont have the freedom to use the iphone.. The AT&T representative advice to stick on a cheaper phone that are not smartphone or else it will automatically charge me $30 a month even if I didn't sign up for it. It is not fair. Now I am returning the Iphone and changing to Tmobile or verizon. Tmobile is cheaper plan and I can get an Iphone jailbroken and they will not charge for any data plan. Which is COOLER than AT&T that will charge me for something that I didn't sign up for! CHEATER AT&T! Me and my family and friends are dropping AT&T also my cousins move to T-mobile. You guys will loose business.

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I am serously consider to get myself the new iPhone 4 but I don't think AT&T should stop the unlimited data packages. Business users use this technology all the time as well as other people that need this. I would love to see AT&T reconsider bringing back the unlimited data package. AT&T makes money off these iPhones and packages, why get rid of a good thing.

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