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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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RE: Attention AT&T Customers: Move!
By FITCamaro on 2/5/2008 3:50:52 PM , Rating: 3
You make a good point. But the problem is that while competition does exist, it barely does. You either choose DSL or a local cable provider. That's your two choices. And thats assuming you're even able to get cable.

RE: Attention AT&T Customers: Move!
By Murst on 2/5/2008 3:54:51 PM , Rating: 2
I'm not sure where you guys live, but here in Cincinnati (not exactly the biggest of towns either), you have a choice of cable, dsl, electric, or satellite. Of course, there's also dialup, but the speeds are way off.

Sure, I'd like there to be more options (and hopefully there will be once the wireless networks are established, or maybe Verizon sets up FIOS), but I'm guessing that the majority of people in the US have access to more than just cable and dsl.

By Polynikes on 2/5/2008 4:18:02 PM , Rating: 2
I doubt most people have more choice than dial-up, DSL and cable, for landline-based services. (Who the hell wants satellite if you can get something more reliable?) Unless you live in a large city, it's probably not gonna that way. I live in Rochester, NY, whose population in 2000 was over 200,000, not including the many outlying suburbs and towns that make up the area, and we've got just those three choices.

I pray that FIOS takes off, so DSL and cable providers will have some serious competition and help get our nation's internet service problem fixed.

By BMFPitt on 2/5/2008 8:48:47 PM , Rating: 2
I live in a pretty populated area, and my choices are: Comcast. That's it.

I can't wait until a year from now when I can buy a house after prices drop another 20% post-summer. I can't wait to go back to the dish.

By Frallan on 2/6/2008 8:56:51 AM , Rating: 1
Thank god its Fri... ehhh Ilive in Europe where theres competition :0)

Just starting a Europe vs. US discussion here... Cant have a topic wo it :0p

"I mean, if you wanna break down someone's door, why don't you start with AT&T, for God sakes? They make your amazing phone unusable as a phone!" -- Jon Stewart on Apple and the iPhone

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