Report on AT&T's tiered data pricing forgets the innovation factor

A report suggests that AT&T's tiered mobile data pricing plan is a good thing and could become the norm - but the report also seems to forget the impact that such a plan could have on technological innovation.

Research firm Strategy Analytics is pitching a report that looks at AT&T's new tiered mobile data pricing structure, the one that takes "unlimited data" out of the equation.

I haven't actually read the report, which the firm is selling for $2,000, so you'll have to take my criticism with a grain of salt. But the summary of it suggests to me that the firm looked solely at the impact of the plan on AT&T's US market and revenues. From my tech point of view, though, the report is missing an important element: the impact on mobile tech innovation.

In one sense, the report's author is correct when she writes that an entry-level tier of data pricing will make smartphones accessible to a broader market. There are those who are just getting their hands on these devices and will be testing the waters of mobile broadband, making a lower-priced entry-level option that more appealing.

But what about the rest of us, the ones who want to stream video and music over our mobile devices, use them as mobile Internet hot spots, tether them to our laptop computers or just try out some cool new fancy app, which happens to be a bit of a data-hog? Given the choice of experimenting with new apps or dealing with astronomical overage charges at the end of the month, I'd probably pass on trying out a new app.

Hmmm. Sounds like innovation being stifled.

I understand that AT&T's network has been taking a beating by excessive data use and, largely, that stems from having the exclusive deal to provide service for the iPhone in the U.S. But is it the fault of the consumer that AT&T got in over its mobile data head when it sold it soul to give Apple the control it wanted over the iPhone ecosystem? Sure, AT&T has benefited financially from having the iPhone in its lineup but it's also been forced to invest heavily in beefing up its network - and still, with the Apple releasing the iPhone 4 today, widespread complaints about AT&T's service problems remain.

So, instead of investing more to upgrade that mobile broadband network, AT&T will instead scale down the amount of data being offered and collect some sweet overage charges when heavy users go past their limits.

Is it just me or does this seem like a step backward? Remember when there was no unlimited bucket of voice minutes on cell phones? How about the old ISPs that offered dial-up plans based on the amount of time you spent online? What a breakthrough it was when you could have that "always-on" broadband connection.

Then again, I may be completely off-the-mark here. After all, Apple pre-sold 600,000 iPhone 4 devices and people waited in long lines overnight to be the first to have one. Maybe they're all OK with taking a step back in time and paying big bucks for sub-par service and I'm just some grumpy old guy without a clue.

While I am worried about Verizon - the carrier I pay every month - following suit, I remain glad that I'm not an AT&T customer.

Previous coverage:

  • AT&T’s data plan pricing: Bringing confusion back to the game
  • AT&T: Is it alone on data cap island?
  • Welcome to AT&T’s tiered pricing world: Will Verizon follow?
  • Tiered mobile data plans accelerate: Verizon Wireless to follow AT&T's lead