iPhone Crushes AT&T Network.. News Of The Day

On May 11, 2009

Grandma used to say "Be careful what you wish for…" (Okay she didn’t but if she HAD used any pithy maxims this might well have been one of them.)

Well, AT&T got its wish in the form of the game changing, network saving device known as the iPhone but, as with all things, there is a downside, as well. 

The Wall Street Journal had an interesting piece over the weekend that detailed the benefits… and challenges… to AT&T of having the iPhone on its system. As they put it…

the iPhone is expensive for AT&T, and not just because of the heavy subsidies on the initial purchase price. Users of iPhone download games, video and other Web data at two to four times the rate of other smartphone users, according to comScore. Yet AT&T charges iPhone subscribers the same fee of $30 a month for data that it levies on other smartphone customers. And aside from restricting certain activities, like file sharing, AT&T doesn’t limit how much data can be downloaded.

The article goes on to point out that, according to one study, during one mid-day hour 69% of AT&Ts bandwidth was being used by web browsing. It is a safe bet that a good deal of that was via iPhones.

The problem is this- almost 6 million iPhone were activated on AT&Ts network in the last three quarters alone. That meaning that over 7.5% of AT%T customers have an iPhone. (And remember this is ONE device that has been out for LESS than two years.) That translates to a huge sucking sound as AT&T’s bandwidth is continually, and increasingly, sucked in by data-hungry iPhone-users… at a rate hat already strains their network.

Ultimately, the piece then points out, AT&T is going to have to add towers and build up other aspects of their infrastructure at the same time that growth thanks to new customers will begin to slow significantly. Not a good combination.

The article is a good read that raises excellent points. It also reinforces something we already knew… the iPhone takes the web on the road more effectively than any other device currently on the market. That’s a blessing for AT&T… and a curse.


via WSJ