AT&T has recently reconfigured its data plans to increase both the cost and data ceiling. The minimum priced plan has increased from $15 for 200 MB to $20 for 300 MB and the larger plan’s data ceiling has grown from 4g to 5g. To put this perspective, 1g equals 1,000 MB. These increases will not affect already subscribed members, who are able to keep their current data rates. This price hike is in response to a failed T-Mobile acquisition compounded with a dire need for more spectrum to support the amount of data consumers are using. To remain competitive in this already saturated cellular market, modern companies are in urgent need of enough spectrum to provide competitive speeds in face of the growing data use by smart phones. The new plan has also raised the data overage cap, to help customers avoid costly overage fees which often times leads to defections to other carriers.
Who does this rate hike affect? Me. As a consumer who is just now approaching the smart phone industry, these new rates will directly affect my decisions as to which plan to use. I have been purposefully ignoring the obvious benefits of the all knowing smart phones, claiming all I need from my cellular device is the ability to call and receive messages. As I watch my friends look up directions, check their finances, search the web and in general have a mini computer at their disposal, I know that the time is drawing near when I must have one of my own. These new rate hikes, in theory, would be a benefit if I desire to use a lot of data. The data ceilings are higher and you are able to get up to 5g of data, compared to 4g with their previous plan. Knowing myself, I will not be able to come close to that amount of data use. This means that the new hike will in effect, just tack on another $5 to may bill for data I may or may not use, although it may help in avoiding overage fees. Will $5 be enough to push me towards another service provider? Probably not, but it may be just enough to push back my purchase of a new smart phone for a few more months.
As the race for smart phone supremacy heats up, with new phones and plans appearing and becoming obsolete almost daily, AT&T is trying to make room for the increasing demand for data. The true question is: Will they be able to make room for new customers without pushing their current ones away?