AT&T announced a new mobile data plan last week, which removed “unlimited” plans as an option. And with other operators, including O2 and Orange, following the same path we ask what this means for mobile?

What’s the story?

Announced last week, the new data rates from AT&T were very generous for high-end data users – but they were definitely no longer unlimited. The plans capped out at 2GB. Less than 2% of AT&T subscribers reach this cap per month, but seeing as the operator has over 80 million wireless users that’s still over 150,000 people who are directly affected by the change.

What about Orange and O2?

Orange is expected to cut unlimited plans from its tariffs this year. Everything Everywhere, the UK joint-venture of Orange and T-Mobile, also believes that unlimited plans are unsustainable. O2 has also caused some fuss by announcing that data will no longer be unlimited, from the same date that the iPhone 4.0 hits shelves.

What we think?

There has been some upset over this move away from unlimited data but the complaints have mainly come from the small percentage of users who access huge amounts of data over mobile. I have to admit, I think that unlimited data was always a bad idea. Current 3G networks simply can’t support that kind of traffic – they were not designed with “unlimited” data in mind. Technological and bandwidth limitations mean that a relatively small number of high mobile data users can slow down the network speed in an entire area – which lead directly to the network blackouts in New York over Christmas.

The problem here is that mobile operators got greedy – they threw data services at people as a way of gaining and retaining subscribers. But they don’t seem to have realised that once they gave limitless mobile data to people, they would make full use of it. Again, it’s a minority of people who are actually affected by this. But it’s a very vocal minority, which is leading to a big PR backlash against operators.

It makes sense for operators to offer generous, capped data plans, and it’s what they should have done from the start instead of overplaying their hand. Ultimately this will become much less of a problem once LTE and other 4G networks begin to roll-out – but in the meantime it is still egg in their faces.

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