AT&T - a world of hurt?

[Uther]

It has been known for a while that AT&T were struggling with the success of the iPhone on their network (apart from hypotheses suggesting AT&T poorly designed their network buffering, causing some of the issues). This has led to them throttling even their unlimited plans - sometimes at levels lower than cheaper priced plans.

Their effort to take over T-Mobile to acquire extra spectrum failed miserably. And cost them $3 billion in breakup fees (not to mention legal and other incidental costs).

Now a disgruntled customer sued AT&T in small claims court and won $850. And the thing is, AT&T apparently can't dispatch a legal team to contest small claims court summonses.

Episode the next? Well, it is rumored that the iPad 3, due to be announced at the end of March, will allow iPads access to 4G and LTE networks - those already overloaded by the iPhone. And iPad users typically uses 4-8 times the bandwidth of an iPhone.

If it was me, I'd be looking to short AT&T stock - but that's just me.

[Brian]

ATT world of hurt is even bigger- You failed to mention that AT&T is losing on each sale of iphone. Market share is good to get but not if you cant generate actual increased revenue from it.

http://money.cnn.com/2012/02/08/technol ... /index.htm

[Brian]

On a similar topic.....forget all these fancy phones that can do everything. How about a phone that can provide really good calls? How many drops, missed words that cut out and you have to repeat? Cell phones are a complete distraction to business conference calls.

If I had a phone that gave me clear calls, with no drops, almost equal to a landline, id be all over it. Put it in a big 1990 brick phone and I wouldnt care.

[Uther]

Can't tell you how many dropped calls AT&T has, I used to be a Sprint customer for 12+ years and in the last 6 or so I had no recollection of a dropped call. Many dropped calls are issues with users walking around or switching between cell towers or some other technical glitch that I would not directly lay at the foot of the cellular vendor.

I have recently switched to T-Mobile on a really good incentive deal and from everything, it seems the 4g cellular service (and fallback to 3g and lower in more remote areas) are excellent and voice quality on the new phones also seems to be excellent if we don't use the speakerphones.

[skiing1974]

As someone making living in the wireless industry, directly dealing with every wireless operator...not here to defend or atack any of them, however, user experience will be based on capacity available in their networks. Sure, Sprint has better 4G (wimax) user experience, because they have less customers, they also do not cover the same geographic area with their 4G as Verizon and AT&T do. Capacity requirements on the networks, driven by "i" devices will drive every operator to the point where they can't support it anymore, thus the throttling. There is only so much physics, math and $ will do for them. THey lack bandwidth, looking to use unlicences WiFi frequencies to offload their cellular traffic. They can not recover the $ the put in their networks to upgrade them in order to support the capacity users are asking for. Unfortunately, voice is almost secondary concern, however, if they upgrade the networks for data, voice improvements will come too.

[Common Sense Al]

I read an article about this (can't find it now so I'll try to summarize)... it said Verizon has a similar problem but they don't 'ridiculously' throttle the users down to almost 0... they allow them to use any remaining bandwidth that might be available while AT&T will choke these people off, even if the bandwidth is available. It said that in many cases, Verizon users can't even tell they're being throttled. It seems AT&T just knocks their bandwidth down considerably to where they can hardly do anything, even if bandwidth is available. Sounds like AT&T should do what Verizon does. You might as well make use of the bandwidth if it's available.

[Uther]

I can't talk to Sprint's 4g experience - my old phone was probably 2g. Lately it wouldn't even ring if I was sitting next to it and sometimes even the voicemail notifications would arrive 30 minutes later. But I don't blame Sprint directly for that. I'm sure that if I got a newer phone than hadn't been immersed in water and dropped numerous times, my experience would have been better. And I didn't suffer as I said from dropped calls one the call was established and if I didn't move around.

It was just that I didn't want to upgrade and enter another contract with them, even though I can honestly say they've been getting *much* better over the years. It was just that I've been liking T-Mobile and their SIM-card based devices that I can use overseas better. Now I can get rid of my UK-based phone and just transfer the SIM card to my T-Mobile phone when I travel overseas.

[JKTex]

If you had an old "cell" phone recently, there's a good reason you'd drop calls. It's the device which likely hasn't been updated/supported in a few years thus you don't get the latest PRL thus can be under a new tower and not be able to use it.

I've been with Sprint for about 15 years and for the 2nd time, I'm close to being ready to move on, because of coverage. And it's not going to get any better before they make any headway with their new network. I think there's a reason you don't see them advertising 4G as much or at all lately, since they announced dropping Clearwire/Wimax to build their own LTE network. I believe as part of that, no new/maintenance upgrades that aren't already on the books wil be done with any of their network. An the fact is, Sprint bites in most of this area. It's great in a few small pockets and that's it.

And now Sprint is making small steps to bump revenue, like what they just did, on the monthly billing they now line item each line on Family plans so they can reduce the amount they apply corporate discounts to. I'm sure they'll continue to sneak in as many little "gotchas" as they can, which hurts what has been their #1 advantage, pricing. Not to mention, while they'll support the current phones, the new LTE network will not support the existing 4G phones. For those that upgrade ever 1-2 years it may not be a problem, but if you don't, you'll be stuck on the old network as long as they keep that agreement going.

I think it's going to get ugly for Sprint in the next 2-4 years, but it's something they need to do so they can get up with the big boys and compete.

[skiing1974]

one thing Verizon doesn't have that AT&T does is 3+ years of iPhone service on their network. If Verizon sees the same iPhone growth as AT&T (and no reason not to), Verizon will have similar network issues in 2-3 years. Capacity growth is predicted by Cisco, Ericsson, AT&T to be in the neighborhood of 6000% over the next few years, no operator can support that with the bandwidth allocated by the FCC, pure physics.

[Common Sense Al]

I like Tracfone... it fits my needs and less than $10 a month, even with taxes and fees.

Hey, maybe the solution are those microsites (or what are they called)? Little devices that cover very small areas, but they can be put in high density locations and take the traffic off the larger cell towers.

[skiing1974]

exactly Al!:) small cells are the future of the wireless networks.

[Uther]

Which brings to mind another thing... I have a Tracfone surplus to current requirement with 1,100+ minutes and 46+ days of service.... Anyone think it has any resale value?

[Uther]

Now the fun is *really* starting. AT&T has clarified their "unlimited" plan to mean 3GB. Which is the same as their top (if a two-tier plan can have a "top") tiered plan.

First you should know that AT&T offers only 2 plans: a 300MB plan for $20 and a 3GB plan for $30. This shows a huge disparity if one calculates a "per byte" cost for each plan. Additionally, if one exceeds the tiered plan, additiona data is charged as $67/GB on the low tier and $10 on the higher tier - unthrottled. Again, a huge per byte pricing discrepancy.

Skeptics observe that there is no justification for the throttling in terms of "network quality", since the throttling does not take into account location, time, or any other qualitative factor - only data usage. They also note that since the unlimited plan costs the same as the 3GB a month plan, this means that effectively AT&T is trying to coerce users to pay more ($10/GB) for users who exceed the 3GB tier of data usage.

This means it is entirely a revenue grab, and has nothing to do with network quality. AT&T is using pricing to force every user onto their 3GB (and then $10/GB thereafter) plan, rather than having a two-tiered plan or even a 3-tiered plan with one tier being "unlimited".

Sprint advertising is correct in that they truly do offer an unlimited plan - but IIRC, that is at $50/month.

T-Mobile (where I moved to in February) offers 2GB vs 300MB AT&T pricing tier of $20 and then throttles data usage, whereas AT&T will hit you with a $20 per 300MB at their uncapped speed. Not a place I want to be price-wise. I like to know definitively how much my bill is going to be and I don't want to risk an overage that could wipe out my family budget if a kid does something stupid.

Do the math. If you sign up on the 300MB plan, by the time you have consumed 3GB of data it will cost you $174. This is the stick that AT&T use to "force" you to sign up for the $30/month 3GB plan. And since there is nothing in it for AT&T if your usage is over that, they throttle your speed to make you consider going to the equivalent-priced plan where they can charge you and get revenue if you go over.

[Common Sense Al]

This is another place where we need some gov't regulation to stop customer abuse... something like, if your extra charges are going to exceed a set amount (that you can set), then they are required to text you notification or something. The fact that they can seem to get away with ridiculously high "surprise" charges says they don't really care about the customer. Or even better, a way to set up an alert that sends a text to you at regular intervals with your account status/balance.

This is one of the reasons I like my simple Tracfone so much. It tells me EXACTLY what I have. There are no surprises... OK, well there is one thing I don't like and that is that they place a 'web browser' button (on some phones) where you can easily hit it (with no way to get rid of the button), and if you accidentally hit it and cancel out quickly, it still charges you... that to me is a bit of a scam but it's nothing like being surprised by a bill that's $100 or more higher than you expected.

[Uther]

No Al, this isn't an area for government regulation. The on'y "regulation" needed is to prevent AT&T from going back to its roots and becoming a monopoly by gobbling up competing providers (cough.. *T-Mobile*.. cough....).

Dumb consumers deserve most of what they get. So does AT&T.