AT&T spends less on upgrades, makes more off data

Gizmodo put out an amazing graphical representation of the current AT&T situation. As previously reported, Ralph de la Vega, head of AT&T's consumer services, said that AT&T is upgrading their network to handle the demanding iPhone and its growing customer base, but it may come at a cost to consumers who use a lot of data. The statement came in response to complaints about AT&T's poor network quality.

As seen in the images below, AT&T's "commitment to improving their network" claim could not be further from the truth. Since the release of the original iPhone, AT&T has consistently spent less money on network construction. This seems very strange, considering they beefed up construction right before the iPhone's initial release. With such a high demand phone, AT&T should be expected to continue investing in their network, especially considering the fact that the iPhone was upgraded twice already, allowing it to consume more data, and ultimately bring more customers to the carrier.

Since the release of the iPhone, AT&T's revenue has consistently increased. They now make approximately 80% more revenue from wireless data than they did when the iPhone was initially introduced. This increase doesn't seem to be slowing down anytime soon, as it has been steadily inclining for the past two years. The post also shows stats regarding the economy's negative effects on AT&T's net income. Guess what? There weren't any. AT&T was able to increase their cash, and cash equivalents on hand by 4.375 billion dollars since the start of 2009. They've seemed to keep profits fairly steady, considering the times.

So why does AT&T complain so much and threaten to charge users more money for less service? Data hungry phones, like the iPhone, are the sole reason for their substantial profit increase. Further scaling back construction will surely cause the network to cripple under the weight of the iPhone.


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47 Comments

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Cell service is the "network" so if the coverage is spotty it wont matter what phone you have it will not be that great.Where I live AT&T wasnt that great before the iPhone came out.

BREAKING NEWS: Corrupt, monopolistic American mega-corporation rips off gullible users.

When are you people going to learn? These companies are not your friends!

BREAKING NEWS: Corrupt, monopolistic American mega-corporation doesn't rip off gullible users.

Now that would be news ^

toadeater said,
BREAKING NEWS: Corrupt, monopolistic American mega-corporation rips off gullible users.

When are you people going to learn? These companies are not your friends!


saying American is pointless, I see this happening a lot in Europe also...

Okay so you guys are sick of AT&T well your entitled to that opinon I won't fault you there. But hmmm let me check here as for now we still live in a republic with a free market system( now I know that could change here soon but for now). So that being said yes AT&T is in the business to make money or did I not notice a change here in the last couple of months? If a consumer doens't like the way they do business then change companies and vote with your wallet. Oh and by the way everybody keeps saying AT&T but if I remember right it was Cingular who bought out AT&T so I would really say it's Cingular's coporate structure guiding this, again not going to say they shouldn't be making money cause that is what they are in business to do. And you all can say they should not be able to make the billions they do but that is just the way it works, if you all want to not have it that way then move to a socialist country and as far as I know the biggest one left is China and it has adopeted many free market ideals. Anyways that is my two cents worth you all have a Happy Holiday's and a Happy New Year

I fail to see any point you tried to make. If you are implying that AT&T is entitled to make money however they see fit, then yes, I could agree with that. It is, after all, a free market. I do believe the point of this article is to demonstrate that AT&T has been using the iPhone as the reason for all their network troubles. Over the past weeks we have seen many articles regarding comments made by AT&T saying users need to be educated on “what a megabyte really is”, and “it’s the data hungry iPhone users that are causing an excessive load which is the root cause of why our service sucks” and why AT&T customer service is non-existent.

Moving to the point of this article it shows how AT&T is more concerned with finding someone they can blame, rather that looking at them selves as a possible source and fixing their network. After-all, the iPhone works perfectly on overseas networks and doesn't cause problems for non-iPhone users.

So, are you saying AT&T has the right to blame their customers for AT&T network problems and the customer should be punished by paying additional fees, when the facts we see almost daily indicate the problem is internal to AT&T. If that is your definition of free market, then don’t’ start a business in the USA. We Americans are strong believers in “accountability”, which AT&T doesn't seem to understand or simply does not care.

I am an iPhone user, but also have 3 lines with Verizon. Both companies have their faults, but I am having trouble remembering when Verizon, Sprint and/or T-Mobile went on a mass campaign blaming their inefficiencies on their customers and their phone vendors with absolutely no facts to back up their claims.

I'm still hoping Operation Chokehold is a go. I have a VERY select few people that I still call friends that sadly, own an iphone.

They're all down for Operation Chokehold tomorrow. I hope to see AT&T eat it in the financial sector.

After that is complete. I tactfully explained Operation Little Gay Pink Dress in which all iphone users will have to sport one if they want to continue using such a shtty device. lol If you wanna use an iphone you can't be a poser and dress like you're heterosexual. You're not.

at&t is garbage and only wants to pocket extra cash while doing little to cope with increasing demands, thats why everyone else rocks and owns at&t so at&t complain.

Isn't this because they rolled back one of the bills, that forced these companies to invest their profits back into upgrades, back in the Bush administration?

LOL it was +1 until the idiotic comment about "the other one third...". Something like 97% + of Americans live and work in 3G Coverage areas from multiple carriers, so that's 3% not 33%.

And actually, rural coverage is pretty good too. I am buying a house in a town with less than a thousand residents that's pretty rural and I get full bars at the house, and my cable internet is just as fast as what it is in the Metro areas...

Other than that though, I totally agree... I am so glad that Sprint has decided to change their practices and be honest with customer's and try to gear things toward what customer's really want, while AT&T and (to a lesser extent) Verizon continue to push customer's the direction they think is best, disregarding what the customer actually wants / needs.

I hate to be the devils advocate here, but perhaps the answer is far simpler than we care to admit. What AT&T and other carriers like Verizon and so on are doing goes back to the history of any economy that is based on capitalism with a corrupt government.

"If the people are willing to pay for it, then why not sell it."

Why would any wireless carrier NOT lock you into lengthy contracts, NOT increase your termination fees, NOT provide you with expensive poor service, NOT provide you with phones that are locked down to force you into additional subscription services, and then decide bill you more for the same service...NOT violate your civil rights by handing over your emails, text, phone calls to the government (oh, and don't forget the wiretaps they admitted to), NOT put comments in their contracts that say "If we find out you are publicly bad-mouthing us, we will terminate your service, and the service is not guaranteed".....???????

Why would they NOT.....IF YOU ARE WILLING TO PAY FOR IT!

Some would argue that cell phones and wireless data are required in today's world, so then the question would be "How is the other one-third of the country getting by without it (Example: Rural areas that do not have 3G and other high end service)"?

My point....either boycott their asses, write to your local senators and other government reps, your state and fed attorney general and the public news media......Otherwise, shut up and pay your bill! Sorry NEOWIN, If you think these government officials that have the power to stop this crazy **** wake up and read this forum......your living in the clouds.

Hi!

This is a news web site. Not sure exactly what you think it is, but judging by your post I think you are on the wrong web site. People are paying their bills. No one is taking this issue to the extreme your post presumes. Calm down a little.

Intel008 said,
I hate to be the devils advocate here, but perhaps the answer is far simpler than we care to admit. What AT&T and other carriers like Verizon and so on are doing goes back to the history of any economy that is based on capitalism with a corrupt government.

"If the people are willing to pay for it, then why not sell it."

Why would any wireless carrier NOT lock you into lengthy contracts, NOT increase your termination fees, NOT provide you with expensive poor service, NOT provide you with phones that are locked down to force you into additional subscription services, and then decide bill you more for the same service�NOT violate your civil rights by handing over your emails, text, phone calls to the government (oh, and don't forget the wiretaps they admitted to), NOT put comments in their contracts that say "If we find out you are publicly bad-mouthing us, we will terminate your service, and the service is not guaranteed"�..???????

Why would they NOT�..IF YOU ARE WILLING TO PAY FOR IT!

Some would argue that cell phones and wireless data are required in today's world, so then the question would be "How is the other one-third of the country getting by without it (Example: Rural areas that do not have 3G and other high end service)"?

My point�.either boycott their asses, write to your local senators and other government reps, your state and fed attorney general and the public news media��Otherwise, shut up and pay your bill! Sorry NEOWIN, If you think these government officials that have the power to stop this crazy **** wake up and read this forum��your living in the clouds.


+2
If your not happy with the service being offered to you, don't subscribed to it. If you subscribe to it anyway to get your precious iphone, you knew what you were signing up to so stop being a whiny little b### about it.

I'm glad to see some of this stuff coming out about AT&T. They really are a horrible company, and maybe this will prompt them to improve some, or for users to leave their service and go with someone that does upgrade their network...

M_Lyons10 said,
I'm glad to see some of this stuff coming out about AT&T. They really are a horrible company, and maybe this will prompt them to improve some, or for users to leave their service and go with someone that does upgrade their network...

Won't happen, as long as the iphone remains an AT&T exclusive they won't be losing many customers any time soon. They clearly know the average iphone user very well, the type of people who will do anything to subscribe to the latest fad and to hell with the service they receive as a result of it.

I'm sure at&t has ways to tell (through IEMI numbers or similar) to know who is on their network at any one time. If they start seeing a lot of bandwith being sucked out of certain areas, you can bet they can knock them offline just as easily.

naap51stang said,
I'm sure at&t has ways to tell (through IEMI numbers or similar) to know who is on their network at any one time. If they start seeing a lot of bandwith being sucked out of certain areas, you can bet they can knock them offline just as easily.

It's IMEI... and they would track based on Sim Card, not IMEI... and they would have to have adaptive software to do that based on rules, it would be impossible for a human to keep up with the rapid changes that happen on a network... and if they had adaptive software that intentionally interrupted their customer's connections, you can be sure that there would be class action lawsuits up the rear.

So in other words... you fail.

Andrew Lyle said,
Tomorrow is operation chokehold, which is suppose to bring down the AT&T network. We will see.

I haven't been following the planned cyber-attack you talk off, but then again, I don't follow any other 4chan-like related activity either.

because the iphone is one of those devices that is "always talking". it's not only the the amount of bandwidth being used. open idle connections use up vital channels that a tower could be giving to someone else.

M_Lyons10 said,
That I did not know... What is the device doing when idle that is using bandwidth that other phones do not?

it's not the bandwidth. it's like when using a torrent. you might only be uploading at a couple kBps but you have hundreds of open connections. you might be able to sustain an upload speed 100x what it's doing. but all those open connections can crash your router.

for the record. i took att mobile customer service calls for west corporation a couple months back. it's truely a miserable job.

AT&T has become Hostile to Apple and the iPhone, Why dos no-one mention the increase in "Other" mobile devices AT&T is adding to its customer base that rely on the 3G network such as all those net-books with AT&T 3G built in?

but all the blame for a congested overworked network gets put on the iPhone? WTF!

The real problem is that the popularity of mobile internet itself has grown beyond AT&T's capacity to foresee and fulfill demand for its own business, EPIC FAIL!

Phantom Helix? said,
AT&T has become Hostile to Apple and the iPhone, Why dos no-one mention the increase in "Other" mobile devices AT&T is adding to its customer base that rely on the 3G network such as all those net-books with AT&T 3G built in?

but all the blame for a congested overworked network gets put on the iPhone? WTF!

The real problem is that the popularity of mobile internet itself has grown beyond AT&T's capacity to foresee and fulfill demand for its own business, EPIC FAIL!


I think they just know their market, they see iPhone users as "addicted to the web" type people who will cough up money to get what they get now unlimited so they are pushing it as their fault... but it kind of backfires since those people are also very vocal

AT&T has many issues with their service, etc. I think the iPhone gets a lot of the spotlight because AT&T made certain promises to get the iPhone, and though it's been profitable for them, they have not lived up to their end of the bargain at all... When you make a deal to carry a phone that uses data like the iPhone does, you have to upgrade the network to cope with these customers whether that was agreed upon or not (And it's my understanding that it was promised to Apple).

One of the comments over there actually made a good point: AT&T could simply be building a shell (of money) to hold out the recession or could be accumulating money for the big upgrade they spoke of.

It's not necessarily bad. AT&T itself is still pretty bad though.

billyea said,
One of the comments over there actually made a good point: AT&T could simply be building a shell (of money) to hold out the recession or could be accumulating money for the big upgrade they spoke of.

It's not necessarily bad. AT&T itself is still pretty bad though.


The stoped a lot of major deployments like u-verse in a lot of areas to hord money... or moved from FTTP to copper for u-verse in a lot of areas to horde money... very few areas are FTTP on AT&T because of their greed lately... but then Verizon slowed FiOS FTTP deployment too because of hording money...... but AT&T seems to historically push out a new tech like a carrot on a string, dangle it there, get the people with money then suck them into spending it over a long period of time with no improvements...

Or more probable, building up cash on hand for a purchase when some of their competition starts struggling due to the economic conditions. Their competition has kept spending aggressively during these times as they are banking on advancements in infrastructure and new customers to survive / grow. AT&T may be banking on their old, unchanged infrastructure, and cash on hand in order to do the same thing.