AT&T recently announced their new data plan which would offer 2 GB of data for $25 a month ($10 for every extra GB), compared to their previous unlimited plan costing $29.99. According to AT&T, 2 GB is worth 10,000 emails without attachments, 1,500 emails with attachments, 4,000 Web pages, posting 500 photos to social media sites, and 200 minutes of streaming video combined.
While that sounds like roughly a month’s worth of usage, those that use their iPads on the go to stream video may be in for quite a shock when their bill comes in. For Netflix users, they’ll get between three and six two-hour movies, or four and eight one-and-a-half hour movies a month.
“It’s a lot like the early days of cell phones, where 100-minute plans didn’t get you too far,” said Al Hilwa, analyst at IDC. “Video is an obvious data hog, and [AT&T’s new plan] presents an opportunity for customer backlash.”
While AT&T estimates that only about two percent use over 2 GB a month, with more and more media rich materials coming to both the iPad and the iPhone, it could quickly become an issue. A Nielsen survey from 2009 said mobile customers watch 3 hours and 15 minutes of mobile video each month, up 70 percent from 2008, while teenagers watched 6 hours and 30 seconds.
“While AT&T asserts that its high-end 2 GB cap will only impact the heaviest users, the fact is that today’s heavy user is tomorrow’s average user,” said Chris Riley, policy counsel Free Press and net neutrality advocate.
Also, with many apps for the iPhone and iPad designed to consume bandwidth, their business models could be affected.
“If you’re in the business of selling streaming video a la Hulu, streaming music a la Pandora, … AT&T just changed consumer perceptions of those businesses for the worse,” said Carl Howe, analyst at Yankee Group. “Now those consumers are going to have to pay bandwidth charges as well as whatever subscriptions they may have. And that’s going to make those business leaders not very happy.”
Source: CNN Money