Will lack of unlimited data plan hurt AT&T and Android?

Last summer AT&T caused something of a hubbub when it announced tiered mobile data plans. Previously, smartphone owners paid $30 per month for unlimited data. In fact, in 2007, the year the iPhone was launched, they paid just $20 for data. But AT&T quickly realized that iPhone users consume data aplenty, so they upped the rate to $30, and then eventually put a 2GB cap on accounts (though they lowered the price to $25). Now, with Verizon not only getting the iPhone, but offering unlimited 3G data, AT&T has apparently made a few exceptions in order to retain current customers. It makes me wonder whether the lack of an unlimited data plan will hurt the company’s Android sales. The exceptions include iPhone customers who previously had an unlimited data plan, but, for some reason, switched to the 2GB plan. According to the above-linked AP report, these customers can, in many instances, switch back to unlimited. This is apparently an attempt by AT&T to retain customers that might have defected to Verizon, taking advantage of its free-for-all data. iPhone users who previously did not have an unlimited data plan are not eligible for the upgrade, nor are users of other smartphones. The sole intent, in appears, is to keep iPhone users. Right now AT&T doesn’t have a particularly impressive array of Android handsets. The Samsung Captivate is easily the best, as it is part of the Galaxy S series. The HTC Aria, too, is a serviceable handset. But if you’re looking for the latest, state of the art smartphone, you’ll find the picking slim at AT&T. That will change soon, though, as the company is reportedly set to release the Motorola Atrix next month. As we learned at CES, the company has plans for two other HSPA+ Android handsets: the Samsung Infuse and the Inspire 4G. That will make them a more attractive Android destination not long after Verizon becomes an attractive iPhone destination. I have to wonder, though, whether AT&T’s limited data plans will hinder sales of its Android devices. After all, heavy users can go through 2GB without trying very hard. These phone are being billed as 4G, meaning AT&T’s HSPA+ network. What is the point of having such great speeds if you’re capped at 2GB? Streaming music and movies, two features for which HSPA+ is most useful, then becomes a chore. Are you going over your limit? How close are you? AT&T does offer a way to monitor data, but that doesn’t exactly help. Sure, you can brace for your bill, which will include a $10 per gigabyte charge, or you can stop using your phone until your billing cycle ends. Neither is an attractive option. As data networks get faster, the demand for consumption will rise. Carriers might have to get creative in managing their networks, but imposing caps as restrictive as 2GB will do little but turn off consumers. I don’t expect Android sales at AT&T to go particularly well, but even if I’m wrong, I’d expect a high level of customer dissatisfaction. If you have a high-powered handset, a low data cap kind of puts a damper on it.

About the Author

Joe Pawlikowski is the Senior Editor at MobileMoo.com and has been covering the mobile industry full time since 2007. When he's not writing about the tech scene, he can be found discussing his personal love - baseball (and more specifically the New York Yankees) as well as writing on his personal blog.