AT&T to Require Data Plans for Smartphones
Posted by: Olga Kharif on August 21, 2009
Starting on Sept. 6, AT&T will require all new smartphone users to subscribe to the carrier’s wireless data plans, the company confirms to BusinessWeek.com.
Today, some of AT&T’s smartphone customers can chose not to buy a data plan, or they can subscribe to MEdia Net, a cheaper service that offers wireless e-mail and news access for as little as $2 per Megabyte. Currently, AT&T’s data plans range from $5 to $60 a month.
While I suspect that most people who buy smartphones subscribe to data plans already, there’s probably a hefty percentage that get smartphones for voice calls and good looks. They figure they might use them for data later. That’s the category of users AT&T is now hoping to rope into buying more services. And the move likely means increases in data revenues for the carrier — and slower sales growth for smartphone vendors.
Heavier monthly charges could deter some people from buying smartphones. For AT&T, that’s no great loss. The carrier spends a lot of money on subsidizing handsets so consumers get them at a lower price; and those subsidies may not pay off when expensive, feature-rich smartphones are not being used for data services, as intended.
The move, which is likely to be copied by other U.S. carriers, could slow down smartphone sales, however. So far this year, handset makers Apple, Research in Motion and others have booked double-digit revenue growth on smartphone sales. Well, that sales growth should come down as service plan prices go up, and consumers that only want the handsets for voice may opt for a cheaper option: a feature phone.