According to a story in The Wall Street Journal, AT&T exec John Donovan says the company is looking at an option to charge developers for the data consumers use during app usage. This means that an app developer, say Netflix, might tell customers that they would not be charged by AT&T for any data they consumed while using the Netflix app; instead, Netflix would be paying for that data. Sounds good for the consumer, perhaps, unless it means that the Netflix app or Netflix sub suddenly costs more money. Somebody’s got to pay for that data, somewhere. AT&T is just trying to shift the cost onto the app developer so the consumer doesn’t get mad at AT&T when the bill comes due.
“What they’re saying is, why don’t we go create new revenue streams that don’t exist today and find a way to split them,” Mr. Donovan said. “A customer nearing his data limit for the month could be more likely to download a movie if the content provider covered the price of the data transmission.”
It’s a sneaky end run around piling on extra charges for more bandwidth, which AT&T is loath to do unless other telcos grab some of their customers looking for a better deal. So why not hide the cost by offloading it to app developers? Hmm, well, maybe because app developers wouldn’t be all that keen on putting up an additional barrier to customers. This might not impact game companies as much, but anyone that streams a lot of data (like video services, or game -streaming companies like OnLive or Gaikai) would be deeply affected.
It’s possible this plan runs afoul of the net neutrality concept, except that doesn’t really apply in wireless networks unless a carrier is trying to block a a competitive service. AT&T is certainly going to see if they can move this forward, unless something stops them. They would dearly love to get all the companies that use their network to pay for the privilege, along with the consumers using their network. Getting paid all around probably sounds like a great idea to AT&T, but consumers and app developers probably won’t be as thrilled at the thought.
Thanks to Gigaom.