Some answers from AT&T on data pricing

By Felix Salmon
June 6, 2010
Mark Siegel some questions this morning:

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I sent AT&T spokesman Mark Siegel some questions this morning:

1. Will you have “rollover megabytes”? If not, why not?

2. Why do the plans have to be chosen ex ante, rather than ex post? Wouldn’t the plans be much more convenient for consumers if they just automatically paid for the Data Pro plan when they went over 200 MB, but paid only for Data Plus if they consumed less than 200 MB?

3. How exactly does data plan switching work? If I’ve consumed 150 MB in a month and switch from Plus to Pro for the rest of the month, do I pay any more than if I had been on Pro all along? What if I’ve consumed 250 MB in that month before making the switch? Do I pay $30 or $25? And what if I switch down from Pro to Plus — is the amount of time I spent on the Pro plan pro-rated, or do I still get the whole month for $15?

4. Here’s a comment I received on my blog:

It’s a patently cyncially priced plan. It’s extremely easy to exceed 200MB if you use your phone to surf the web and use Google Maps on a fairly regular basis, but you’re unlikely to exceed 500MB unless you do data intensive stuff like downloading music and streaming video.

You say you’re all about consumer choice, but it does seem that your choices are clear ones only for (a) Blackberry users who mainly just use email; and (b) heavy users who stream music/video, or who have a 3G iPad. The rest of us — which I think would include most people with an iPhone — are in that unhappy cusp zone around 200 MB where it’s very easy to make the wrong choice. Are these plans specifically designed to make us unhappy?

5. An AT&T representative said here that iPad 3G owners who turn off their $30 unlimited plan will be able to turn it back on again. Is that true? And is it fair for people to characterize the widespread advertising of the unlimited iPad plan as a bait-and-switch, given that it lasted less than 40 days?

Siegel replied:

We don’t have rollover megabytes.

The iPad plans are all prepaid and no-commitment. You pick the plan that works for you. Want to drop it? No problem. Want to pick it up at some other time? Also no problem.

We think that approach is easy and flexible and puts the customer in charge of what they want to do.

On switching plans: Customers can switch between the two new plans easily, even in the middle of the month. They can do so themselves on the Web or by contacting us. In either case, they choose whether to make the jump from DataPlus to DataPro that day, for the next cycle, or backdate to the beginning of the cycle to avoid overage charges. And remember, we give free text message (and email if we have the address) alerts at three usage levels, in addition to all of the other ways customers can monitor usage.

If you buy the iPad before June 7 and want to use the unlimited plan, you can.

So, that’s one question answered, at least: it seems that you can backdate your data plan to the beginning of your billing cycle if you’re switching up from Plus to Pro. (It’s not clear if you can backdate a downswitch from Pro to Plus.)

It’s also pretty clear that if you turn off your unlimited data plan on the iPad, you won’t be able to turn it back on again. But we knew that already, didn’t we.

As for the lack of rollover megabytes, I think that underlines that the underlying business plan here is cynical/evil. AT&T loves to talk about how many people use less than 200 MB of data per month on average — and if they really cared about serving those people, then they would be happy to let them roll over their unused megabytes. But as it is, someone like me who uses less than 200 MB of data per month on average is still probably going to end up subscribing to the Data Pro plan. Which is great for AT&T — an extra $10 a month for them — but is hardly the customer service that Siegel’s making it out to be.

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