Bad idea of the day: A crippled iPhone

By Felix Salmon
May 18, 2009

Olga Kharif speculates that AT&T might release a crippled iPhone later this month:

The exclusive U.S. iPhone service provider is considering cutting the price of its monthly service package or offering a range of lower-priced plans, say people with knowledge of the company’s thinking. One plan that could be introduced as early as late May would include limited data access at a $10 monthly reduction, the people say.

This is a stunningly bad idea. For one thing, $10 a month is not very much money, considering that the cheapest iPhone plan is $70 per month excluding text messages, and unlimited texts (which aren’t included in the unlimited data plan) cost an extra $20 a month.

More to the point, unlimited data is intrinsic to how the iPhone works. Everything from visual voicemail to thousands of different apps, including very data-heavy apps like Google Maps, relies on the fact that the marginal cost of data is zero. If you start limiting data access, you’re essentially limiting the use of the phone itself, and it becomes something to be mistrusted rather than something to be loved. If I press the Mail button by mistake, how much data will I inadvertently use? What happens if I think I’m happily surfing on WiFi, but then for some reason get booted onto the cellular network?

The iPhone was the first phone to be fully integrated into the internet; unintegrating it by introducing a limited-data plan would be a horribly retrograde step, especially when lots of other sexy new phones, including the Palm Pre, are about to be introduced.

Incidentally, at the end of that NYT article, we find this:

“Phones don’t stand the test of time,” Mr. Donovan said. “I look at my personal handset museum, and the coolest thing I had in my pocket eight years ago is laughable.” When it comes to phones, he added, “there are no ‘Citizen Kanes’ out there.”

Not true.

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