[ny times] One reason AT&T decided to pull the plug on unlimited data usage is “data hogs,” those users who download a considerable amount of data each month on their mobile phones.
But the big question is: how many data hogs are there on the network and are they really slowing it down? Or is this a pre-emptive move to prepare for a new era of mobile billing where data far outshines talk minutes on a subscriber’s monthly bill?
In a press release, AT&T said: “Currently, 98 percent of AT&T smartphone customers use less than 2 GB of data a month on average.”
That sentence left me wondering how many mobile phone subscribers actually go over two gigabytes of data each month. Two percent could be a huge number, especially on AT&T’s network.
Although AT&T declined to tell me exactly how many users are in the 2 percent bracket, we can estimate that it’s as high as 660,000 people.
Here’s my math: AT&T has 85.1 million subscribers. According to Patrick Hornung with Brunswick Group, a public relations company that works with AT&T, as of last quarter, 33 million of those phone subscribers reach AT&T with an “integrated device.” This includes smartphones and devices like the Samsung Magnet phone, which offer a full keyboard and limited access to the Web.
So, 2 percent of 33 million phones users is 660,000. Granted, this is the high end of the estimate, but we know it’s somewhere in that ballpark.
A little over half a million users going over two gigabytes a month isn’t necessarily a high number, and it isn’t affecting AT&T’s network, either. In a report released Thursday by PC Magazine, AT&T’s 3G data service was rated the “faster average 3G speeds” over its competition in the United States. (It was also rated the “least consistent” with the most dropped connections.)
That’s why AT&T used the word “currently” in its press release. The data numbers are rising, as are the revenues that AT&T can glean from higher mobile Web usage.
According to CTIA, the wireless industry association, as of December 2009, there were 49.8 million smartphones in the United States, up 22.9 percent from June of the same year, when there were 40.7 million smartphones in use. CTIA also reports that data revenues rose to $42 billion in 2009.
In addition, the research firm Parks Associates predicted last year that American mobile broadband use would reach 140 million people by 2013. Cisco has also forecast that data use on mobile phones and other wireless connected devices would double every two years through 2012.
Although AT&T would like its customers to think it is doing them a favor by charging less, or as the company said on Wednesday, making “it more affordable for more people to enjoy the benefits of the mobile Internet, ” the carrier is pre-emptively preparing for more data hogs and in-turn higher revenues when people surpass their allotted monthly data usage.
AT&T is also taking a big gamble with this latest move. Competitors, including Verizon and Sprint, will likely try to capitalize on the latest capped data plans and lure away already unhappy iPhone customers, who, it is estimated, make up almost half its smartphone customers.
AT&T Versus the Data Hogs