That’s increasingly a problem for AT&T, which serves all those iPhone users in the US and must pay for the bandwidth to handle it all. AT&T starts at a loss by subsidizing customers’ iPhones. Then, it charges them only $30 per month for unlimited data download & upload — or the same it charges users of other smartphone, even though those users are cheaper to serve.
iPhone users now make up for 7.5% of AT&T’s subscribers. Their data-hungry lifestyles have strained AT&T’s infrastructure so much that “AT&T will need to add cell towers and spend more on the back-haul lines that connect the towers to the rest of the network,” the WSJ reports, after citing stats from Alcatel-Lucent, a network equipment maker showing how bandwidth-hogging Web browsing is. Web browsing consumers 32% of data-related airtime but 69% of bandwidth, while email used 30% of data airtime but only 4% of bandwidth, the study found.
It’s easy to pontificate — as the Journal’s analyst sources do — that AT&T should do away with unlimited data plans, or raise the price on iPhone users. But the company’s discount pricing on the expensive iPhone and its accompanying high-bandwidth lifetyle aren’t an accident. With more touchscreen iPhone competitors like the Palm Pre coming to market, and AT&T’s exclusive status as iPhone carrier set to expire next year, the company is clearly willing to pour money into locking down as many iPhone customers as it can.
(Photo credit: Anirudh Koul)
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