AT&T set to launch new data plans

Plan starts Sunday for new smartphone, tablet customers, $30 unlimited data plan stays in effect for current clients

AT&T today unveiled data plans for new smartphone and tablet customers that will take effect on Sunday.

The company said that current AT&T customers don't have to switch to the new plan, meaning that the current $30 unlimited plan stays in effect for them.

The changes for new customers offer more data per month at a lower cost per gigabyte, AT&T said.

Analysts, though, took note that the minimum entry cost for the cheapest new plan is higher than the current one, reflecting higher customer demand for data and the enormous cost of building the new 4G LTE network.

AT&T's new plans are also a good dose of reality in a world where data rates will continue to rise and carriers have little incentive to start a price war, analysts said.

"AT&T is raising prices, which reflects the need for AT&T to have higher minimum charges per customer to increase their revenues, even though the per gigabit cost is lower," said Jack Gold, an analyst at J. Gold Associates.

"AT&T can charge higher prices because consumer demand is there, and there really is very little price pressure," Gold added. "I don't think this will be the last increase consumers see."

Under the new AT&T plans, users will pay $20 a month for 300 MB will, $30 a month for 3GB and $50 a month for 5GB, with mobile hotspot capabilities. On the two higher plans, it will cost $10 per added gigabyte per month.

For tablets, the new monthly plans are roughly the same: 3GB for $30 and 5GB for $50.

For new customers, the 200 MB plan for $15 a month converts to 300 MB for $20, while the current 2GB for $25 goes to 3GB for $30 a month and the 4GB for $45 becomes 5GB for $50 with hotspot capability.

The 33% increase in the entry level plan, now at $20 a month, is for 50% more data, analysts noted.

The new plans are "driven by ... increasing demand in a highly competitive environment," said David Christopher, chief marketing officer at AT&T Mobility, in a statement. "Customers are using more data than ever before."

AT&T advised customers to use Wi-Fi as much as possible, which doesn't count toward a monthly data plan. The carrier has 29,000 Wi-Fi hotspots nationwide, and AT&T's smartphone and tablet customers can use them at no added charge.

AT&T also has an online data management calculator to help customers estimate usage for typical activities. Once on a data plan, AT&T also will send usage alerts via text message.

Gold said the popularity of new smartphones and tablets and the wide availability of data-rich applications such as music and video is driving the need for AT&T's new plan.

Sprint continues to have unlimited data plans, but Gold said Sprint's network won't be comparable to AT&T's LTE network until Sprint launches one in mid-year.

And in the current economic environment, Verizon Wireless "has no interest in starting a price war [with AT&T] because Verizon wants increased revenue as well," Gold added.

Matt Hamblen covers mobile and wireless, smartphones and other handhelds, and wireless networking for Computerworld. Follow Matt on Twitter at @matthamblen, or subscribe to Matt's RSS feed . His e-mail address is

Copyright © 2012 IDG Communications, Inc.

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