AT&T Caps Unlimited Data Plans | Hacker News Reader

AT&T Caps Unlimited Data Plans

online.wsj.com

34 pointsgrellas49 comments

When someone offers you an unlimited plan, or says that you must sign a contract, watch out. The former means that there is a limit, and it is low and they don't want to tell you what it is. The latter means that their service is so crappy, the only way they can keep you is by legally obligating you to keep paying them.

We've seen this with "unlimited" web hosting: practically it means that you can only store a certain amount of data and only have so much bandwidth, and when you start "abusing" the service, you get booted. Calling it "unlimited" gives the provider a license to change the rules whenever it sees fit.

I welcome data caps and limits. If AT&T tells me I can only use 2GB of data and at what speed I can make an informed decision on whether to go with their offering or not. I would like to see the limits be more near a 20-30 GB mark as that is my usage, but that is better than "unlimited, but if you do something we don't like we limit you". Please, if you run any kind of service, put a limit on it an make sure you can meet the demand, unless the resource is not constrained on your part in any practical sense. For example, I say "unlimited email notifications" on Ping Brigade, but there is no real constraint in place. However, I put a hard limit on how many services/servers you can monitor because I know the limits of my system and I have planned for capacity (and have a plan to expand the capacity if all of a sudden the service gets popular).

Contrast that with AT&T, who sold first and build the service later. I guess though that it works out for them: they have billions while I can only buy noodles with my earnings.

I think you're off base on this and are looking at the issue from a single side.

The "Unlimited Data Plans" are cooked up through marketing departments that take a broad look at the numbers their network can ideally handle and conclude that when matching up customer usage models to these numbers they can offer a service that exceeds the average user's need. If they evaluate the market and determine that the average user is a 2GB/month type user and their network is supposed to be able to handle upwards of 7GB/month per user at their projected service rates they make the offer that "unlimited" is what is offered.

From the consumer's P.O.V. an "Unlimited" data plan looks much better than a "7GB/month" data plan. Smoke and mirrors.

What happens is the power users or edge cases to these hypothetical usage models break down that service offering. A lot goes into a mobile network and heavy users CAN cause issues to the equipment out in the field. What happens is the tech side of the provider begin to scramble to make things happen, project budgets skyrocket and everything suddenly looks terrible on paper.

The next step is then to realize that "unlimited" is a pipe dream and is really only available to those people who check the weather and read their emails on a daily basis.

/rant

tl;dr - its not a malicious decision by the provider to make these offerings. They work with models and offerings from a business perspective that aren't ideal from a technological perspective and the disjoint creates problems on the bottom line. To the end user however it looks like a planned event.

"marketing departments that take a broad look at the numbers their network can ideally handle and conclude that [...]"

"the power users or edge cases to these hypothetical usage models break down that service offering"

I don't see how you can write the former and then get the culpability so wrong in the latter. It's not the "power users" or "edge cases" that broke the model, it's that the model was wrong. AT&T thought they could offer "unlimited" service at a certain price, and they were wrong. And rather than honor it and lose money, or change their pricing and lose customers, they are cheating with a throttle.

I'm sorry, but that is malicious. They're playing with the dictionary definition of "unlimited" instead of offering their customers the service they promised.

My apologies for my poor explanation. You're entirely correct with what you've said. The model they employ certainly is broken if it doesn't account for the possibility that not everyone falls into their ideal customer. When I said that "it is not malicious" I really should have stated that it is not with malicious intent. A marketing manager doesn't create offerings that they feel will piss off the customer base because a child could tell you that unhappy customers == churn and by extension churn == less marketing jobs as the company shrinks.

I merely wanted to provide a perspective as to what sort of train of thought is followed regardless of how logical it may be.

OK, agreed. It's not a bait and switch. AT&T honestly believed their pricing was sound. I believe that too.

I don't, not for a minute. Look at how the AT&T iPad plans changed a month after launch. That was not a usage based decision, and it takes longer for a company their size to create the materials than the time between launch and the change.

They've known what they were doing, and considered these actions a viable contingency.

It is not planned. I don't care if they make decisions out of malice or out of good intentions. The reality is that AT&T did not do their capacity planning and are still not doing it. The other point is that when anyone offers anything "unlimited" that you know is scarce, you should ask for hard contractual limits. Imagine saying "OK AT&T, so you tell me this data plan is unlimited. Can I stream 500GBs of movies over this connection? Yes? Can I get that in writing?"

"Unlimited" gives the seller an unfair advantage over the buyer, at least the way it has been used. My advice is to avoid anything "unlimited". Simply mentally substitute "variably limited" and see how you like the sound of what you are about to sign.

I think it's more like those "permanent laser hair removal" things. They can call it permanent if it works for 6 months. If after 6 months you grow all your hair back, that doesn't make it non-permanent according to marketing laws.

Advertising "unlimited" and then not providing it should be illegal under truth in advertising law. It's well past time for ISPs to get rid of this whole "unlimited" concept and start charging reasonable rates for usage.

I agree, but they are technically not stopping your service, only throttling it. So you can still get "unlimited" amounts of data, it'll just take longer. In the same vein they can get away with saying they have the "best" network because "best" is subjective.

Definitely needs to change, though. It's horse shit.

Why can't we just have unlimited for wire-based services?

Also, I'll take a flat rate over "reasonable rates for usage" any day, when it comes to my internet. I'm sorry, but my usage varies wildly, and I want a consistent bill I can trust.

I would be in support of a "$0.25 a GB of 35/35 until you hit 250GB, then flat rate of $X for the rest of the month, at a limited 15/10" or something like that

> Why can't we just have unlimited for wire-based services?

Because routers and trunk circuits can't handle unlimited amounts of traffic.

Wire-based services suffer from contention as well, just at a much higher usage than wireless services.

A provider's costs to serve you are largely fixed. A sane bill will have a large fixed cost plus a variable cost for usage. For example, rather than the fixed ~$45/month I pay to Comcast, I'd expect to pay something like $30/month for the connection itself, then another $15 (or perhaps more, since I'm probably a heavier user than the average) for bandwidth.

We manage to get by without fixed bills for gasoline, food, electricity, water, etc., what makes internet special where you absolutely need it to be consistent?

For wired lines, he provider does not pay for usage, it pays for a certain sized pipe. So if you use a terabyte of data in a month but all of it comes at off-peak times, but your neighbour uses 10 gigabytes a month but always does it during the peak evening period, your neighbour costs the provider more than you do.

If the provider did not pay for usage, then why would they care how much you use in a given month? And yet, wired internet providers are demonstrably upset if you use "too much", with some even having official policies of kicking you off their network if you do it consistently.

Ultimately capacity is the limiting factor, but the way capacity is managed is to charge people to use it. Your ISP is charged by the byte for its connections to other ISPs.

You're absolutely correct that usage patterns greatly impact the cost of usage, but simply charging by the byte is a good approximation. A more sophisticated arrangement might have different prices at different times of day (this is already common for electricity) but so far it doesn't appear that this is necessary.

I have no stats, but gasoline, food, electricity and water are, generally, a constant price and value. I suspect internet usage, especially if a person hosts a website/dedicated video game server would vary considerably month to month.

Statistics need to be taken to validate/invalidate my speculation; but, I imagine when I was on 35/35 FiOS and 25/25(20/20?) FiOS beforehand, my internet fluctuated on the order of 10s, 20s or even 50s of GBs a month.

My electricity bill varies by a factor of 4 over the course of a year, since the bulk of my electricity use in winter and summer is heating and cooling. This is true of a lot of people I've talked to, and they all get by fine just the same.

People who host web sites or dedicated video game servers are usually already paying for usage. Some hosts offer "unlimited" plans but most charge for bandwidth. Somehow they survive.

Let's say your internet fluctuated by 50GB/month. Comcast is currently effectively charging me 20 cents/GB right now (~$50/month with 250GB cap). Even if this rate doubled under some hypothetical pay for usage plan, you're talking about fluctuations on the order of $20/month. If you can't tolerate that then you probably have bigger financial problems to worry about.

Recall that the current situation with most ISPs is not actually unlimited. It's just that when you exceed their arbitrary and usually private limits, instead of charging you more, they make your connection stop working or they fire you as a customer. (With Comcast, if you exceed 250GB in one month, they warn you. If you do it again, they fire you.) Having your bill go up for additional usage is better, not worse, than having your connection stop working altogether.

I can't believe no one is talking about how this is all arbitrary and all made up, and a part of an ongoing fleecing of the public resources, the airwaves, like they fleeced us on the right-away we gave them, the telephone lines, which resulted in the whole dark fiber hooked up to nothing.

Why don't you explain it yourself?

Well, in a nutshell, back in the 80s, there was a fee tacked on to all phone bills for "upgrades" that had listed among other things that everything would be moving to fiber optic. Instead they sort of double dipped. You can read articles like http://en.wikipedia.org/wiki/Dark_fibre perhaps as a starting point, but essentially they charged their customers a special government mandated fee, that allowed them to build it out but not actually have to hook it up anywhere, and then when everyone forgot about this fee and what this really was, then treated as this new asset they could sell off, all while never actually figuring out the last mile problem, which was the heart of the original law to begin with. So now with wireless it is the same thing, where terms get thrown around like "bandwidth" and "capacity" and while they want to, on one hand, say that these are limitations from the FCC or just plain physics, they are actually words to describe the fact that it is their towers, or the connections to the towers, that they purposefully keep limited in order to facilitate very high profit margins. So they tell their customers "have all of this unlimited everything" but they've only built out (of their own equipment mind you) the ability to service 10% maybe of what they sell, so that when people actually start using it, they can then blame the customer, all the while showing ever increasing profits to their shareholders. I would be very very suspect of anything any of the damned companies have to say about their own capacity, and be very careful not to assume that it is the airwaves that are full, but it is really their equipment that they've oversold.

This outcome is actually better than what AT&T previously has been doing.

At least now unlimited users on the grandfathered $30 plan can consume the same amount of data as the 3GB/$30 metered plan, and only get throttled after 3GB.

Up until now the throttling trigger was at 2GB. When people called AT&T and told them that customers on the current 3GB/$30 plan got more data than those on the "unlimited" plan (yet paid the same price), they were told that they were more than welcome to switch to the metered plan that doesn't get throttled.

I wish they made this an actual option though. When you hit your cap, do you want AT&T to charge you for the overage or drop your speed? Right now it's a one-way decision, and only for those who still have an "unlimited" plan.

Off-topic: How do people typically go over 3GB in a month? The only time I came close was when Spotify forced a re-download of all my previously-cached music and I had my wifi turned off. My IT person (in a company <50) said I'm the only person to have ever gone near 2GB.

I'm sure you can easily go over the limit by streaming Netflix...but I generally watch Netflix at home.

I moved 6 months ago and didn't have internet for a couple of days, tethered my phone to my Roku. Phone was nearly unusable for the rest of the month.

My billing cycle ends tomorrow and I'm at 5935.74 MB. For me it's streaming podcasts (managing downloads in iTunes is a pain), YouTube, and lots of web browsing. During the MLB season I probably use even more, because I stream multiple games per day (I haven't checked this). I also semi-frequently buy albums from iTunes on the phone.

In short, it's not very hard if you use the phone like I do.

Edit: Wow, it actually appears I was hovering around 1GB per month until last September, during which I used 2.7GB -- a jump from 0.5 GB the month before -- and after which it's been a close-to-linear increase. Weird. I didn't realize my habits have so drastically changed.

On my Android phone I use the doggcatcher app to download podcasts. I go well over 3gb each month, but as a Sprint customer I currently do not need to worry about the limits.

I could certainly set the app to only download on wifi and avoid the issue entirely. However, it is quite nice to have it check hourly for new podcasts and download them at that point no matter where I am.

AT&T has pushed on us hard. We pay almost $200 for 2 people. We will be moving over to T-Mobile when the contract is up. It will save us almost $100 a month and still keep the unlimited plan. Ive had enough of AT&T for a while, im just waiting for this damn contract to be done with.

You probably do it trivially on your land line, no? Synchronize a big dropbox share, upload all your music to Google Music, etc...

Now picture if you were poor (edit: first world hipster poor, anyway), and had to decide between the wired broadband and a smart phone that was almost as fast.

There are people who are cancelling internet plans in prospect of using 4G networks as their home internet through tethering.

I used to push very near, or even exceed 2GB when I was listening to Pandora/LastFM/GrooveShark all the time. I hate commercials, so I used my phone as a radio playing device when I was in my car, and I was in my car a lot. I also occassionally look up YouTube videos, connect to my server via SSH and a variety of other things.

I just got off the phone with AT&T customer support. While the representative was sympathetic, she stressed that "AT&T is not required to provide notification of service changes." I informed her that this change constituted a major change in service, and that I viewed it as grounds to waive the ETF and get out of my current contract. This, apparently, is not a view shared by AT&T. I'm debating wether or not to call again and be nasty to see if I can get out of my contract, but I doubt it will do any good.

A big problem, though, is the severe and opaque nature of the throttle. From what I've heard ATT throttling can cripple the connection even for email. On the other hand I was barely annoyed when my carrier put in a throttle after a couple gigabytes because the speed is still a quarter megabit.

I ran a speed test on my (throttled) AT&T 3G connection on my iPhone 4. 5 bars, perfect signal here. 0.03 Mbps down and 0.02 up. It's absolute bullshit.

Are you still on 3G? T-Mobile's throttling solution is just to force your connection to EDGE once you hit the cap.

That's not entirely true for T-Mobile, actually. You still connect to 3G towers even after throttling, but you are slowed down to "2G" speeds. In practice, the 2G speeds are much slower than EDGE, but slightly faster than GPRS.

I've experienced this on T-Mobile, and the connection is still usable, though slower. The AT&T throttle sounds unusable.

Yep, still on 3G.

why stick with them now that the 4 major cell phone companies have the iphone and 1 (Sprint, i think) even offers unlimited unthrottled data plans?

And that's the trick: AT&T implemented throttling just after all the dedicated iPhone users upgraded to an iPhone 4S and locked themselves in for another two years.

Disgusting, eh?

You didn't have to lock in. If you paid full price for the iPhone 4s, then when you first plugged it to iTunes, you got a "congratulations, your phone has been unlocked" message, and the phone stopped being carrier locked. This worked since iPhone 4s release day, before the 'official' unlocked phone shipped.

If you'd been on sprint lately you'd know it's because the whole 3g network performs like it's throttled.

that seems like a fair enough complaint, but what about verizon or tmobile?

vzw at least is quite fast, but I believe they both throttle heavy users.

I don't have a choice. It'd be too expensive to switch.

No 3G on T-Mobile.

I'm with Sprint and they offer unlimited data for iPhone users and probably across their network for smartphone users.

My usage is higher then average but even using Spotify and Pandora in the car everyday (30 to 40 mile drives) I rarely go over 2 gigabytes.

if i recall correctly, it used to be the case that if a cell phone provider made major changes to an individual's contract (at least in california), one had a small window to terminate the contract without the termination fee (or with a reduced termination fee).

am i mis-remembering this or does anyone know if this is still the case?

That sounds correct. I used this before in Washington, DC when I was a Verizon subscriber. I cannot remember what Verizon changed at the time... It might have been the price on text messages. I did the same with Sprint when I changed to an iPhone in 2009 also.

I'm very interested to know if this applies here. I've been LOOKING for a free way to switch from AT&T to Straight Talk!

Regardless if it is still law I imagine you could get out of the contract in the event they pulled this. Contract Law is pretty clear on what is allowed within contract negotiation and having one party modify the contract agreement (regardless of the B.S. clause of modifications can occur without consent) is typically not widely accepted.

Having said that your contract with the ISP is worth roughly $500 or more depending on when you entered the contract. If you started to lean on them with a "legal" threat of contract termination and taking it to the courts blah blah blah they'll most likely voluntarily terminate the contract because its not worth their time/effort.

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