AT&T's new dataplan

I have waited in line for every new iPhone. I was an early adopter and one of both AT&T's and Apple's best customers. Yesterday AT&T came out with a new data plan. Instead of unlimited data for $30; I can sign a new plan and get 2Gigs for $25. I can also pay $20 for tethering.

This won't hurt AT&T much because I like my iPhone and and most people do as well, but it will hurt Apple. Today, I have an iPhone 3Gs and I can tether with it. For iPhone OS 3 there was an easy hack that enabled the tethering option. It was disabled after a few updates, I never updated.

I would buy the new iPhone as I have in the past on the first day. I like having the new iPhone and being the first to have it. The prospect of a new data plan however will deter me from getting a new plan. Moreover the $20 tethering plan is insulting.

If you are going to charge per device and offer unlimited access do it; if you are going to charge for data then charge for data not both. This is an option where AT&T cannot have it's cake and eat it too. They can't charge me for having a data plan, then charge per gigabyte, and then also charge depending on how I use my data plan. These are all deterrents to using their network. If you don't want to offer network access why are you in this business? One argument has been presented that this is an attempt to push people towards landbased solutions for which AT&T also has a stake. If so, the companies should be spun off. That would be an example of poor management hurting the wireless business and AT&T using their wireless business suboptimally. They also will now have to deal with customer service costs dealing with billing and billing complaints. In the end, this will probably end badly for shareholders as well.

Most news outlets have been stating this is a win for consumers because they can save $5. I disagree. AT&T should encourage consumption on it's network, that will encourage people to migrate to the network. This business model will hurt growth because potential consumers will not join AT&T. In the end, perhaps the problem is spectrum allocation. The spectrum's are fixed and therefore as one remains empty offering superior service another will fill providing suboptimal service. Therefore true economies of scale can't be achieved hurting consumers because efficiency is not rewarded.

This will also deter business clients from adopting because it imposess variable costs. Enterprise clients should be the main focus. Apple has arguably saturated the consumer market but the business market still uses BlackBerrys. This will give enterprise clients a rational reason to avoid migrating.

All these things will end badly for all parties involved. In tne end, AT&T has managed to make me put off a new iPhone purchase. One could argue that I am not most people, but I was one of the first to get an iPhone and if I find something better then other people will eventually find something better as well. I plan on either trying new Phones or waiting until a hack is discovered that allows me to keep my current plan and buy a new iPhone.