Print 93 comment(s) - last by mindless1.. on Feb 8 at 8:56 PM

AT&T plans rate increase for broadband service, hopes customers will be willing to pony up cash for higher rates

The state of broadband in U.S. was described in an in depth analysis at DailyTech last year as "pathetic" and "disgraceful".  The industry is plagued with poor service quality, substandard data rates, zealous attempts to limit file-sharing, and most of all high prices.

Fittingly, San Antonion-based AT&T, notorious for at one time suspending user's right to free speech, announced a rate hike.  The rate hike, a $5 flat rate increase to subscribers' current monthly fee, may be financially lucrative for the company, but is likely to make no one else very happy.  The increase, announced Monday by a company spokesman will go into effect in March.  All states besides those acquired by the buyout of Bell South will be effected.  Bell South operated in Alabama, Florida, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, South Carolina and Tennessee, so these states are exempt.

There are some other notable exceptions to the increase.  The increase, while applying to the vast majority of accounts, only applies to the three slowest connections speeds; 768 kbps, 1.5 Mbps, and 3.0 Mbps.  The 1.5 Mbps service tier is AT&T's most used, with 14.2 million subscribers.  Most of these subscribers will be hit with the rate increase.

New subscribers to the 768 kbps service will be exempt, but most people don't choose this option.  Also exempt are customers who signed up under special promotion packages.  These customers are exempt for the remainder of their promotion's term. 

AT&T informed customers of the increase by email beginning last week.  AT&T spokesman Michael Coe states that the increase is to, "to better reflect the value of our broadband service."

AT&T has been having a tough time financially, ever since Chairman and Chief Executive Randall Stephenson announced that he saw weaknesses in the current consumer broadband and cell phone markets.   AT&T has also recently announced a controversial new filtering plan to snoop on consumer's use and block "rogue" file sharing traffic.

The consumer internet world has been having a tough time in the U.S. and abroad of late.  In France, the government threatens an internet tax which would raise prices.  In the U.S. domain tasters exploit the system to take domains and ad-revenue from legitimate users.   Meanwhile, Time Warner recently announced an even more scary proposal for the consumer broadand industry -- usage based billing schemes.  Normal consumer broadband is speed limited, but has no monthly bandwidth limit, to the delight of many downloaders.  Unfortunately, Time Warner labels these individuals "devil users" and looks to curb a feeling of entitlement to "all you can eat" internet.

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By christojojo on 2/5/2008 3:46:09 PM , Rating: 2
that it will ....

"better reflect the value of" my work effort?

AT&T informed customers of the increase by email beginning last week. AT&T spokesman Michael Coe states that the increase is to, "to better reflect the value of our broadband service."

I really am sick of companies raising prices or changing products because "I asked for it". Just tell the truth.

I.e. I didn't want 12 ounces of coffee in one pound cans. I don't want to pay more for less period.

Your entitled to make a profit. Just don't tell me that I asked for higher prices.

By TomZ on 2/5/2008 4:33:18 PM , Rating: 1
I agree - instead, AT&T should sell its users on the idea of upgrading to higher data rate tiers, instead of just raising the price as they did. Higher data rates probably don't cost them much more to offer, and it becomes a win-win for both the customer and AT&T.

But, at the end of the day, they have a right to set prices how they see fit.

By jconan on 2/5/2008 8:56:46 PM , Rating: 2
Also you can't change phone companies because of the territorial restrictions. So if you have AT&T you're stuck with it unless you move.

2nd AT&T just needs to cut their fat and focusing on how to get better reliability and ample bandwidth. The filtering mechanism is an added cost and isn't even part of their company's purpose to provide communications service. They just need a new CEO and should fire the current one for unnecessary spending and breach of fiduciary obligations. IMHO...

Isn't Apple cutting too much into their profit with the iPhone profit sharing? What happened to the R&D? That's part of their loss income. Smart Apple and dumb AT&T.

By Christopher1 on 2/6/2008 8:12:18 AM , Rating: 1
No, you are not stuck with AT&T unless you move. Here in my area, a rural area, we have a grand total of 20 phone companies offering to do our home phone landline service.

That doesn't amount to being stuck with only AT&T. People need to start actually looking instead of saying "The only phone company around here is AT&T!" It usually isn't.

By mindless1 on 2/6/2008 10:38:52 AM , Rating: 2
So you actually think if the major carrier raises prices, all the minors buying blocks of service from them won't have to also raise rates? Go ahead and tell them you feel this way, I'm sure it'll make a difference.

By TomZ on 2/6/2008 11:22:27 AM , Rating: 1
No, you are not stuck with AT&T unless you move.

Incorrect, at least here in Southeast Michigan - only one choice for landline phone service - AT&T. So then your options are to have a landline or not have a landline.

Yes, there are lots of choices for long distance service. Yes, there are other choices for DSL - but in this case other vendors are crippled since they have to lease the copper pair from AT&T, and so AT&T can easily eliminate all its competitors through pricing. In fact, I thought I read recently of a ruling where companies like AT&T can now entirely refuse to offer these services to competitors.

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