AT&T's New iPhone Data Pricing Will Have Users Spend More per Megabyte

Last Updated Jun 2, 2010 5:55 PM EDT

I mentioned AT&T's announced plans to end unlimited data plans for new iPhone users in the U.S. It's ultimately bad for smartphone vendors such as Apple (AAPL) , Google (GOOG), RIM (RIMM), Microsoft (MSFT), and Motorola (MOT), because it effectively limits innovation by reducing what people can afford to do. But the ones who will really feel the pinch are consumers.

AT&T has crafted its pricing in keeping with the revenue extraction techniques that telecom companies have used for decades. The technique is simple: get people to panic and pay more, even though they need less. The first tool is differential pricing. With the $15 a month plan for 200 megabytes of data and the $25 plan for 2 gigabytes, those on the cheaper plan pay 7.5 cents a megabyte for data. The more expensive plan runs 1.25 cents a megabyte.

Any AT&T salesperson will know to underscore that difference and show how much of a bargain the more expensive plan is. Yet, according to AT&T, 65 percent of its users will be fine with only 200 megabytes a month of data transfer. Almost two-thirds of the company's iPhone customers apparently don't use the data capabilities of the handset, after downloading some apps, to max out even the lower plan's capacity.

Because the more expensive plan is unlikely to change their usage habits, many people will find themselves talked into a plan that, while appearing to cost less, actually costs more. Now the 200 megabytes or less a month effectively costs $25, or 12.5 cents a megabyte, instead of $15 by using customers' fears against them.

The second tool will be the iPhone 4G model itself. It's newer! Faster! However, speed is irrelevant in this case. AT&T doesn't have a 4G network. (Some would argue that it barely has a 3G network.) And even if it did, the speed doesn't affect the total amount of data that someone transfers, although you could argue that higher performance might convince people to do more with the phone's data capabilities. However, for the most part, people will do what they've previous done. The theoretical 4G capabilities helps salespeople convince consumers to pony up for the more expensive data plan, no matter how much or little they need the additional capacity. Think of it as telecom's answer to the super-sized meal, only the only thing that gets fatter is the carrier's bank account.

Images: RGBStock users igord2 and lusi, site standard license.

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    Erik Sherman is a widely published writer and editor who also does select ghosting and corporate work. The views expressed in this column belong to Sherman and do not represent the views of CBS Interactive. Follow him on Twitter at @ErikSherman or on Facebook.