Speaking to investors at a UBS conference in New York, Ralph de la Vega, head of consumer services for AT&T, said that the nation's second-largest wireless provider has been working to improve its network as bandwidth-hungry devices like the iPhone 3GS have resulted in poorer quality service. But he also said, according to The Associated Press, that it is inevitable that high-bandwidth users will be charged for what they use.
The report noted that 40 percent of the network capacity for AT&T is used by just 3 percent of smartphone users. Most of the bandwidth goes to activities like streaming audio and video, available through various applications for download on the iPhone.
De la Vega also revealed that the company intends to improve its network coverage in major metropolitan areas like New York and San Francisco, where there is a higher concentration of smartphone users.
Earlier this year, the iPhone was referred to as the "Hummer of cellphones" as AT&T's network struggled with dropped calls and slow data following the launch of the iPhone 3GS. A report said that the average iPhone user consumes 10 times the bandwidth of a typical smartphone user.
AT&T is spending $18 billion this year, part of it to upgrade and expand its 3G network. But at the moment, it does not have a data cap for iPhone users.
De la Vega reportedly said that AT&T will give bandwidth-hogging users incentives to "reduce or modify their usage." He said the company also, in the future, hopes to make it easier for subscribers to determine how much data they use each month.
"We've got to get them to understand what represents a megabyte of data," he said. "We're improving all our systems to let consumers get real-time information on their data usage."
Competitor Verizon, America's largest wireless provider, has recently taken aim at AT&T's 3G network coverage. AT&T has fired back and insists that its 3G network is faster than its competitors' networks.
Multimedia messaging functionality failed to meet its deadline for iPhone users this past summer after AT&T was concerned its introduction could have further impact on its network performance. The wireless provider has also held off on allowing data tethering, stating that more work needs to be done on its 3G network to support the additional bandwidth.