In late February the Wall Street Journal repotted that AT&T is considering “the equivalent of 800 numbers” for apps, wherein a developer could opt to pay for customers’ data usage within the app. With the WSJ’s follow up report regarding data usage on the new LTE enabled iPad, news of AT&T’s plan is buzzing again. There seems to be a bit of negative reaction toward the plan, but this might be the smartest thing a carrier has done in some time. For once the a carrier would be doing something beneficial to the user. While this would be at the developers expense, it could open up new possibilities.
TechCrunch’s negative feedback regarded AT&T effectively earning more for nothing. Writer Jordan Crook argues that most users don’t even near their data cap, and thus AT&T would be charging the developer unnecessarily. This might be true, and while the WSJ’s new report on data use via LTE is anecdotal, there are a number of reasons this plan could help. It does seem unlikely to lower the data plan of consumers. Apps that already have your use aren’t going to help you pay to use them, the same way websites don’t pay off internet providers. But with the absurd data costs in the mobile landscape, there are new business opportunities that this could afford.
A number of GPS apps exist within the iTunes store, and they seem to rely on a subscription model rather than a flat purchase. While they exist today, the data usage of such apps must be significant, particularly now that our data plans hover around 2 GBs. Building in free data use could be a major selling point, even if it means hiding it within the price point. It’s a one time fee, and the consumer never has to worry about ridiculous data overage charges.
In the WSJ’s report on iPad data use they discuss the how LTE is “almost purpose-built for mobile video.” LTE users can stream HD media, which brings a heavy data toll that users may not realize. Covering data costs could allow video providers to touch a larger audience for a longer time, monetizing above the data coverage costs via advertising. I would hardly expect Instagram to cover our photo uploads - it’s a nominal amount of data (then again, web services already pay for hosting). Rather, AT&T’s plan seems great for specific use cases, and it could open interesting possibilities for developers.
It’s understandable seeing this plan as a money grab by AT&T, but for once, we should support it. The (possible) move is innovative and consumer friendly. It may not immediately lower the cost of our data plans, but it appears positioned to help. It seems like every move that cell providers make is angled to hurt consumers. It’s one thing to make a profit and another to strangle your customers’ wallets. AT&T’s idea may seem simple, but it might be the first innovative thinking put forward by a provider in a long time. In an industry that claims to have trouble figuring out how to put together a family data plan, this could be a big step.
(Source: The Wall Street Journal)