AT&T planning to let developers pay for users' smartphone data usage

Posted:
in iPhone edited January 2014


AT&T has revealed that it is working on a system that would allow mobile software developers to pay for users' bandwidth use, in an approach likened to toll-free calling.



John Donovan, AT&T senior executive vice president of technology and network operations, said in an interview with The Wall Street Journal that his company is exploring ways to make money from increased data use on their networks, while also avoiding price hikes that could draw the ire of subscribers. Donovan likened the proposed system to the use of 800 numbers for free calls.



"(It) would say, if you take this app, this app will come without any network usage," Donovan reportedly said while at this week's Mobile World Congress in Barcelona.



AT&T executives believe the system could be a win for both consumers and the carrier itself, allowing third parties to shoulder some of the costs of mobile bandwidth.



He gave the example of a user who wants to download a movie on the go, but who has nearly reached their monthly data plan cap. The content provider selling the movie could cover the cost of the bandwidth needed to download the film, so that the user could still make the purchase and not go over their limit.











AT&T began capping smartphone data plans in June of 2010, just before the launch of the iPhone 4. Previously, iPhone owners were offered unlimited data for $30 per month. Its chief competitor, Verizon, also has capped data plans with a tiered pricing structure.



Last year, AT&T also began throttling the mobile data speeds of its heaviest users. In the U.S., Sprint is the only official nationwide iPhone carrier that does not cap or throttle mobile data usage.



[ View article on AppleInsider ]

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Comments

  • satcomersatcomer Posts: 130member
    What a really stupid idea!
  • jd_in_sbjd_in_sb Posts: 1,268member
    "AT&T executives believe the system could be a win for both consumers and the carrier itself, allowing third parties to shoulder some of the costs of mobile bandwidth."



    What about the win for the developer? Without that, the whole scenario won't work.
  • hittrj01hittrj01 Posts: 741member
    Quote:
    Originally Posted by jd_in_sb View Post


    "AT&T executives believe the system could be a win for both consumers and the carrier itself, allowing third parties to shoulder some of the costs of mobile bandwidth."



    What about the win for the developer? Without that, the whole scenario won't work.



    Yep, I can see it now: "This app is not available on AT&T in the U.S."
  • dancxgdancxg Posts: 36member
    I didn't think there was any bandwidth left and that was the reason for throttling everyone over 2gb? seems they wanted to herd everyone into lower data usage and sell the excess, in essence selling the same data twice.
  • mrstepmrstep Posts: 446member
    Quote:
    Originally Posted by hittrj01 View Post


    Yep, I can see it now: "This app is not available on AT&T in the U.S."



    Unless you have the unlimited data plan.



    Oh no, wait...
  • jragostajragosta Posts: 10,473member
    Quote:
    Originally Posted by satcomer View Post


    What a really stupid idea!



    It's actually a clever idea. Not that it's going to replace conventional apps or that everyone would use it, but I could picture some scenarios where an app developer would want to pay for bandwidth and include it in the cost of the app.
  • williamhwilliamh Posts: 280member
    The example given was a movie download. The win for whoever sells the movie, is that they'll sell more movies. The price of the bandwidth would be built into the price of the movie. Presumably the developer or whoever will be buying data wholesale and won't be paying $15/gb or whatever AT&T charges. A similar system could work for in-app purchases, the developer sells more in-app add-ons and part of the price is for bandwidth. It's another option, I don't see why this is a bad idea if a developer WANTS to offer it.
  • macaddict16macaddict16 Posts: 194member
    AT&T wouldn't be REQUIRING developers to do this, they would let them have the option to add this feature. Imagine Netflix offering an in-app purchase allowing you to stream unlimited movies without going against your data allotment for a few dollars a month. I can also see Verizon getting in on this as well. To be able to implement this AT&T would have to be working with Apple to implement the system. I can imagine Verizon jumping on the bandwagon if it is successful.
  • ljocampoljocampo Posts: 657member
    Quote:
    Originally Posted by hittrj01 View Post


    Yep, I can see it now: "This app is not available on AT&T in the U.S."



    Or... this app (movie?) is available on AT&T for $4.99 w/o data charge or $14.97 w/ data charges.



    Does AT&T really think the content developers are going pay the data usage to AT&T without passing it on to the consumer? You are right that content will not be available to AT&T. If AT&T thinks it can make more money on data than they already are, their bonkers!
  • johndoe98johndoe98 Posts: 278member
    Quote:
    Originally Posted by Macaddict16 View Post


    AT&T wouldn't be REQUIRING developers to do this, they would let them have the option to add this feature. Imagine Netflix offering an in-app purchase allowing you to stream unlimited movies without going against your data allotment for a few dollars a month. I can also see Verizon getting in on this as well. To be able to implement this AT&T would have to be working with Apple to implement the system. I can imagine Verizon jumping on the bandwagon if it is successful.



    If ATT can sell that Data to those companies at a cheap price, why can't it offer that same amount of Data to its consumers at the same price? So, let's say they charge netflix 1$ for movie, well, that means they could give you 1gb for 1$...
  • johndoe98johndoe98 Posts: 278member
    Quote:
    Originally Posted by dancxg View Post


    I didn't think there was any bandwidth left and that was the reason for throttling everyone over 2gb? seems they wanted to herd everyone into lower data usage and sell the excess, in essence selling the same data twice.



    Agreed, but perhaps there is one up spin to all this. It controls what the Data is being used for, so you can't use the Data towards illegal ends, other than in your plan directly with ATT which they ensure is so low you can only do minimal amounts of piracy.



    At the end of the day, for everyone using the data legally, there can only be one reason why ATT wants this. They figure they can charge more, on total, for their Data, which is going to be bad for the consumers since the costs will be passed off to them. The developers sure are not going to willingly take less of a cut.
  • icarbonicarbon Posts: 196member
    I could see this being a temptation for my ipad -- I have a cellular chip, but usually don't use the connection -- if ATT would let me use it only for apps that pay for it, then I would consider using them.



    imagine -- paying $0.50 for a mail app that used the cellular connection without having to pay for the cellular connection.



    not that I imagine ATT letting that happen in a million years...
  • ljocampoljocampo Posts: 657member
    Quote:
    Originally Posted by Macaddict16 View Post


    AT&T wouldn't be REQUIRING developers to do this, they would let them have the option to add this feature. Imagine Netflix offering an in-app purchase allowing you to stream unlimited movies without going against your data allotment for a few dollars a month. I can also see Verizon getting in on this as well. To be able to implement this AT&T would have to be working with Apple to implement the system. I can imagine Verizon jumping on the bandwagon if it is successful.



    So the consumer is paying twice for the data usage built into this content. They already are paying for the data in a data plan. Why would the consumer buy a higher price app//movie/content?



    This is a fail. Any developer who did this would lose sales even at wholesale data prices.



    AND if AT&T can give cheap wholesale prices to the content provide, why are they charging us so much for the same data? The AT&T customers will revolt!
  • cy_starkmancy_starkman Posts: 488member
    Quote:
    Originally Posted by johndoe98 View Post


    If ATT can sell that Data to those companies at a cheap price, why can't it offer that same amount of Data to its consumers at the same price? So, let's say they charge netflix 1$ for movie, well, that means they could give you 1gb for 1$...



    That is like asking why (au prices) an SMS of 160 ASCII characters costs 25c, or perhaps it would make more sense if I said it as $500/mb. That is what carriers charge for data if it is an SMS. Voice packets, price them per meg.



    Carriers aren't charging you $x for a gig cause they have to. It is because it is all the market will pay. So SMS came out pre smart phone, we now accept the bizarre price of it, but mobile data came after landline data. In the consumers mind they think it must cost more to do that mobile and accept the price.



    Not that a tower is free BUT as far as install costs go, you'd have to say digging a long hole and putting cables in it for back haul from the tower (landline) costs a pretty packet
  • johndoe98johndoe98 Posts: 278member
    Quote:
    Originally Posted by ljocampo View Post


    So the consumer is paying twice for the data usage built into this content. They already are paying for the data in a data plan. Why would the consumer buy a higher price app//movie/content?



    This is a fail. Any developer who did this would lose sales even at wholesale data prices.



    AND if AT&T can give cheap wholesale prices to the content provide, why are they charging us so much for the same data? The AT&T customers will revolt!



    You don't necessarily have to pay twice, it would be like Amazon and books. Don't they have an agreement with ATT where you can download the books free? No contract needed? In other words, when you use those apps, your contract data won't be affected.
  • drdoppiodrdoppio Posts: 1,132member
    So AT&T wants to hire the app developers as resellers of their bandwidth? That's one way to do away with net neutrality.
  • johndoe98johndoe98 Posts: 278member
    Quote:
    Originally Posted by cy_starkman View Post


    That is like asking why (au prices) an SMS of 160 ASCII characters costs 25c, or perhaps it would make more sense if I said it as $500/mb. That is what carriers charge for data if it is an SMS. Voice packets, price them per meg.



    Carriers aren't charging you $x for a gig cause they have to. It is because it is all the market will pay. So SMS came out pre smart phone, we now accept the bizarre price of it, but mobile data came after landline data. In the consumers mind they think it must cost more to do that mobile and accept the price.



    Not that a tower is free BUT as far as install costs go, you'd have to say digging a long hole and putting cables in it for back haul from the tower (landline) costs a pretty packet



    I don't understand what you are going on about. So let me make it clearer for you.



    If ATT charges Netflix x dollars per movie, and those Netflix movie are y big in terms of data, then there seems to be no reason that ATT couldn't charge you x dollars for z data, where y = z. There is no need for adding a middle man here other than to apparently increase the costs, overall, on data consumption.



    Right now ATT isn't having a problem selling all their data, in fact they are complaining they are running out. They are just looking to charge more for that same data. That's why they are coming up with these ideas to introduce more complexity into the chain. The purpose of this obfuscation is clear. ATT doesn't want users to realise just how much they are paying for their data. When they deal with the consumer directly, the consumers knows the final price. When they add in middle-men, the costs become opaque and the consumer doesn't know who to blame, ATT or the middle-man.
  • drdoppiodrdoppio Posts: 1,132member
    Quote:
    Originally Posted by johndoe98 View Post


    ...They are just looking to charge more for that same data. That's why they are coming up with these ideas to introduce more complexity into the chain.



    Bingo!
  • jdavyjdavy Posts: 66member
    Unlimited should be unlimited. This is a joke. If the app developer has to pay, so end user will have to pay. I am glad I switched to Verizon when I could still get unlimited data. AT&T treats their customers like crap.
  • retrogustoretrogusto Posts: 431member
    Another exception would be if they introduce advertisers into the mix. Somebody like Hulu or YouTube could offer unlimited viewing of shows that would not impact your data quota, and the whole thing would be sponsored by advertising.



    I imagine there are also other circumstances where the app provider stands to make money by the user spending time with their app, but wants to subsidize the data fees to encourage the user to spend as much time as possible with the app. A movie trailer site could be another example, where the film distributors pay the data fees so people will see lots of trailers and hopefully go see some movies later.
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