Is AT&T’s App-Subsidized-Data Proposal Good News for Subscribers?
Earlier today, a Wall Street Journal article reported that AT&T has been cooking-up a plan to let the developers of apps subsidize the mobile data they use. That is, the company behind the app would make a deal with your carrier in advance, and then any data consumed during the use of the app wouldn’t count against your monthly allotment. Would such a development be a good thing for smartphone users, or is it just the next chapter in a string of data-plan-dissapointments that have been plaguing US carriers?
AT&T likens its idea to 800 numbers, and on the surface that comparison makes a lot of sense. We don’t have to pick up the long-distance tab when we need to call businesses using such numbers, and they’re more than happy to cover the bill because it lets them continue doing business and serving happy customers.
This sounds like a good way to encourage users to check out apps that might otherwise scare them away due to the appearance of heavy data needs. The next YouTube or Skype out there could quickly attract a following, despite heavy use of cellular data, by offering this kind of subsidy to its users.
The problem is that cellular data isn’t the wired phone network, and use of those systems involves different types of resources. When you call an 800 number, or any phone number for that matter, the system can handle much more than its average load; the only time I’ve ever been unable to complete a call was in the minutes following the breaking news of the September 11th attacks.
If we’re to believe AT&T from its constant complaining to the FCC and its heavy-handed throttling of users on unlimited plans, its cellular network is pushing capacity, and demand continues to grow. If anything, it should be looking to decrease the demands on its network, not increase them.
Under this proposed plan, a heavy user might use almost all of his monthly 3GB, and then consume another couple hundred megabytes through these data-subsidized apps. To the user, that would be a boon, since it lets him avoid moving up to a higher data tier. It’s just untenable to suggest that AT&T wants all of its users in that same boat, if it would even be able to support that level of use. Instead, aren’t we far more likely to see casual users not consuming anywhere near their monthly limits, even when adding-in bandwidth used by these subsidized apps?
Without seeing some very private AT&T figures about its network capacity, nor being able to predict developer enthusiasm for this plan, it’s difficult to fully judge the carrier’s idea. On one hand, it sounds like AT&T’s double-dipping from its spectrum holdings. In another light, this is all a moot point, since many users aren’t even approaching their monthly limits (the recent throttling debacle reveals that even most users on 3GB tiers don’t exceed 2GB); in that case, it sounds like developers signing-up for this program would be the ones getting taken advantage of.
We understand why AT&T would suggest a program like this, and it certainly appears sound on first impressions, but we’re just not sure it’s an appropriate way to manage a limited resource like cellular data.