TEXT OF STORY
Kai Ryssdal: Cell phone billing plans are famous for their complexity. But there has been one relative constant out there: the unlimited data plan. All the bytes you can upload or download for one flat monthly fee. Well, you can toss that one on the scrap heap of billing innovation. Today, AT&T announced it’s getting rid of its unlimited plan starting next week. That means all the zillions of new iPhone and iPad users are going to have to limit their data flow or pay for the extra.
We asked Jeff Horwich to find out whether other carriers might follow that lead.
Jeff Horwich: Suppose you want to download an episode of “Lost” on your iPhone. AT&T’s biggest new plan costs $25 a month for two gigabytes of data — that’s a little more than one episode of “Lost.” Each additional gig is another 10 bucks. The caps only apply to data transferred over 3G or other cell-phone networks — downloading “Lost” over Wi-Fi still won’t cost you a thing. But people are using their unlimited 3G data plans for things like video and large file transfers, which is clogging AT&T’s system.
Larry Dignan: AT&T’s network has been struggling with the iPhone for years now.
Larry Dignan, editor-in-chief at ZDNet, says giving people an incentive to limit their data could make the overall network more reliable. He says unlimited data was a nice perk, but spreading smartphone use makes it unsustainable.
Dignan: My hunch is that Verizon’s probably going to follow suit, and there are going to be other companies that come out with caps along those lines.
Dignan never hits AT&T’s new two-gig limit with his iPhone. But Armen Papshev passes it every month. Papshev edits the blog “iSmashPhone.com.” He says making users timid about how much data they use could keep them from trying and inventing new things that use a lot of bandwidth.
Armen Papshev: Maybe you have to cater to some of the kind of early adopters, hardcore users who actually push the technology.
AT&T says right now only 2 percent of customers use more than two gigs a month. People who use less stand to save money under the new plans.
I’m Jeff Horwich for Marketplace.