Tethering Plan Mars Otherwise Good AT&T Changes

| Ted Landau's User Friendly View

[Update: I wound up writing a more detailed analysis of the new data plans and their implications, for posting as a blog entry for my iPhone book. You can read it here.]

AT&T today announced its new data plans for iPhones and iPads (as well as for all their other smartphones). A Mac Observer article summarizes the changes, with full details listed on an AT&T Web page.

The new rules are good news overall — as they will save money for most iPhone and iPad users. But there is one big exception: iPhone tethering.

Briefly, there are 2 plans to choose from: $15/month for 200MB of data (DataPlus) or $25/month for 2GB of data (DataPro). The former $30/month “unlimited” options are completely gone (for the iPad, “unlimited” vanishes only a month after it arrived!).

If you exceed the caps, you pay additional fees. For example, with the 2GB cap, you pay $10 for each extra GB. The new plans go into effect June 7 (although you can retain your current contract if you wish).

Basic plans likely to save money. While the loss of any “unlimited” option is disappointing, most iPhone users should find that they save money with the new plans. As a personal example, I use less than 2 GB of data per month on my iPhone while my wife uses less than 200MB. This means that our combined new monthly data costs for our two iPhones will be $25 + $15 = $40/month. This is a $20 saving compared to the $60/month we are now paying — and for no change in our usage patterns. Great!

For iPad owners, the $15/month contract gets you 50MB less data than the current $15 iPad plan. [Correction: iPad users will remain at 250MB for $15.] Otherwise, the changes amount to the same as for the iPhone. However, iPad users are more likely to reach a 2GB cap than iPhone users — because they’re more likely to do video streaming. Still, I suspect that most iPad users do the majority of their video watching over Wi-Fi, where these limits and fees do not apply. So, even with the iPad, I expect that most owners will wind up spending less per month than under the old plans.

Tethering plan discourages its use. The one big fly in the ointment is iPhone tethering. Apple added tethering as an option last year, when iPhone OS 3.0 was released. But AT&T never enabled the feature. They will finally do so when iPhone OS 4.0 comes out later this summer. My initial reaction to this news was to cheer: “At last!”

However, the pricing structure for iPhone tethering quickly dampened my enthusiasm. Turning on tethering costs an additional $20/month. Further, the option is only available for DataPro users. In other words, having tethering available requires that you pay $25 + $20 = $45/month.

If you have the DataPlus plan and a situation crops up where tethering would be useful — and you only need it for a few hours — you’ll need to spend an extra $30 for those few hours. I would have much preferred a reasonable pay-as-you-go hourly option — available to both DataPlus and DataPro users.

As an added irritation, iPhone tethering usage counts against your 2GB cap. This amounts to double-charging. That is, the $20/month tethering fee gets you nothing except permission to use tethering; there is no data allowance included with the fee.

As it now stands, unless you know you will be using tethering often, AT&T’s plan discourages accessing it — which is probably deliberate. AT&T stalled on even enabling tethering; this is their reluctant concession. I foresee their policy driving more people to consider jailbreaking their iPhones — and using tethering apps such as MiWi.

Question. There is one final point that I am still unsure about: Can users turn on and off the new iPhone plans on a monthly basis, the way you can do with iPads? Or must iPhone users always have at least the DataPlus plan active? We are waiting to hear back from AT&T on this. [Update: It appears that iPhone users will be required to use at least the DataPlus plan.]

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ATT told me the iPad $15 plan would still be 250MB. Seems silly they didn’t make them the iPhone $15 plan the same amount of data.

Ted Landau

ATT told me the iPad $15 plan would still be 250MB.

Yes That appear correct. It also seems that iPhone users will not have the iPad-type option for month-to-month contract for data usage. See this article.





Unlimited Talk = $70 a month
Unlimited Text = $20 a month
25 MB Data = $10 a month <—- STUPID. Almost all users will exceed this.
5 GB Data = $30 a month
Tethering = $30 a month

Data over 5 GB = $0.05 per MB = $50 per GB.



Unlimited Talk = $70 a month
Unlimited Text = $20 a month
200 MB Data = $15 a month <—- covers 68% of iPhone users.
2 GB Data = $25 a month <—- covers 98% of iPhone users.
3 GB Data = $35 a month
Tethering = $20 a month

Data over 5 GB = $0.05 per MB = $50 per GB.



AT&T’s rates are very favorable compared to Verizon’s rates.

AT&T’s tethering rate is LESS THAN Verizon’s tethering rate.

For the 98% of users who use less than 2 GB a month, AT&T is $5 a month cheaper than Verizon, saving $60 a year.  With tethering, AT&T is $15 a month cheaper than Verizon, saving $180 a year.

Ideally, AT&T should also have a limit of 5 GB a month, like Verizon. This makes it easier to use video conferencing on the new iPhones.  After all, AT&T in the 1970s did envision someday having video conferencing on phones.  The 5GB limit would still be a good cutoff point for heavy data users.


200 MB Data = $15 a month <?- covers 68% of iPhone users.
2 GB Data = $25 a month <?- covers 98% of iPhone users.
3 GB Data = $35 a month
Tethering = $20 a month

Data over 5 GB = $0.05 per MB = $50 per GB.

Largely correct, but a few mistakes: 65% (not 68%) of AT&T smartphone (not iPhone) users use 200 MB of data or less.
Also, there is no $0.05 / MB overage for AT&T.  After the first 200 MB or 2GB, each additional 200 MB or 1GB is $15 or $10, depending on which plan you have.  Finally, AT&T uses 1024KB = 1MB and 1024MB = 1GB, so the overage math would be wrong if AT&T did have such a pricing structure.  See www.att.com/dataplans.


Lets consider “Laptop Internet on the Go” options when WiFi is not available (5GB usage assumed).. 

Option 1. $60/month: Go to Sprint, AT&T, or Verizon.  Buy a USB plug in modem (free after rebate) and get Broadband (3G or better) speed Internet up to 5GB per month.

Option 2. $60/month:  Got to Sprint or Verizon and buy a stand alone (battery powered) WiFi router/brick/modem ($99-$199 after rebate) and get 3G/4G speed internet access up to 5GB a month. 

Option 3. $55/month Use my iPhone 3G/3GS.  Datapro 2GB plan ($25) plus three 1GB bumps (to get to 5GB) for $30 (3 x $10 per GB).

Save $5 with AT&T but with caveats that (1) I have to pair the phone and laptop every time I take the phone out for lunch or a meeting, etc, and (2) Whatever data usage I use on the iPhone would probably kick me up another $10 per month (6GB).

The WiFi brick would fit nicely in my iPad bag.. Along with driving my wife’s laptop, iPad and iPhone simultaneously.  Nice as a backup if AT&T service is down.

When 4G speed comes to my town I think the choice will be obvious.

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