AT&T gives iPhone customers a venue to vent

I was baffled when reading this morning this line in an article

"Still, the heavy use of data on its network has caused headaches for the carrier and its customers. Roughly 3% of its smartphone users--most of whom use the Apple Inc. (AAPL) iPhone--account for 40% of the wireless traffic. De la Vega said the company will address the excessive usage issue. The company is looking at providing incentives to reduce or modify their usage."

"The company is looking at providing incentives to REDUCE...usage"

Boy, this tells me AT&T is completely clueless. They don't get it. Data is and always has been the future. To even contemplate this statement instead of facing the reality and doing everything in their power to enhance and expand capacity is all Apple needs to convince itself of the need for other carriers.

They're listening, but are they going to do anything with the data that they collect? My guess is they'll just increase their marketing budget further and continue to expand their 3G network at a snails pace and still be unable to keep up with demand. Or they're just sending all the data to /dev/null

It seems that AT&T is trying to placate its users now that their exclusive deal with Apple is about to end in 2010. Up until now, they could treat their customers anyway they wanted because everyone loves the iphone. With their coverage issues, I predict AT&T will be hard pressed to keep their customers once other carriers start offering the iphone.

As a retired AT&T employee, I can tell you that AT&T will collect the data and then DO NOTHING with it. They talk a good game, but are notoriously short on delivery. Really what can you point to that they have done in the last 3 years to improve their 3G Network?

I am also a retired AT&T guy from Signature Client Group and can't agree with ToeKneeF.

But before tackling the meat of this - I can't imagine what the next VZ TV Ad will say. An iPhone App to collect data on where the network is bad? It screams out that the network is BAD! So expect VZ to pounce on that soon and keep pressing on the coverage issue.

There are ways to collect the data to better increase IP pipe sizing in the backhaul network to improve throughput on 3G. And the dropped call data gives free input to time-of-day cell congestion profiling, especially along Interstate highways, city centers and near special event venues. Paying an RF engineering firm to do the same would cost $Millions.

They will reinforce the network because you can't charge for services not delivered - and I believe the plan is to go towards a usage cap. De La Vega is an ex-BLS exec who worked in the Cingular structure and is tipping their hand that AT&T intends to play that game for VoIP, Apps downloads, movies, etc.

You may recall AT&T proposed to charge heavy commercial content internet users for better levels of service - prioritizing their content over that of others'. The "pay for access" may be headed to iPhone users.

Look, I used to run the engineering division for a wireless company. The basic fact is that AT&T got caught sitting on there butts and the rapid adoption of the iPhone and it's users increased demands have crushed the AT&T mobile network. The reason? Simple, if the network has excess capacity, AT&T looses money. Build the network "just good enough" to handle predicted traffic loads and you make your margins. So, what happens when the "killer app" like the iPhone hits???? Well, simple, the network melts down, and users are unhappy. What takes AT&T so long to fix this? Well, there are many issues that are not under the control of AT&T. For instance, tower costs. To upgrade RF (Radio Frequency) capacity, AT&T has to re-negotiate it's tower lease agreements to install additional or replacement equipment on each affected tower. Further, if this requires additional power or back-haul capacity, they must also re-negotiate space and power at the base of the tower in many cases. Further, the aggregation points have to be upgraded. When you have increased your network usage by 400%, you have to take into account your interconnection agreements as well as the infrastructure that supports you. Don't think that I am defending AT&T. Quite the opposite. AT&T's CTO should have been more proactive and been more vocal in informing AT&T's marketing as well as it's customers as to the limitations of the network. As with any other business vertical, the CTO/CIO role is responsible for ensuring that the company is positioned to support the strategic growth that is required in today's volatile markets...