AT&T & Verizon Shoot Themselves in the Foot

Data Caps Are Killing Mobile App Usage

Are AT&T (NYSE: T) & Verizon (NYSE: VZ) making a long-term catastrophic business decision by imposing data caps and restricting tethering apps on their customers?  Why are carriers are asking their customers to use their wireless and wireline service less while charging more?  Are Verizon & AT&T not holding themselves accountable for under investing in their networks while overlooking free alternatives for data access like free Wi-Fi?

Imposing data usage caps to reduce 3G network congestion is the wrong business solution and results in bad PR.  Instead of investing heavily to fix the problems or subsidizing poor network performance for customers they would prefer to point the fingers at their customers who are they blame as the problem.  Not only have they imposed data caps on mobile phones by AT&T has decided to start capping their U-Verse broadband data caps for customers.

Telecom data usage caps are quietly killing the growth of mobile app business and Wall Street investors and consumers are going to pay for it severely.  WiFi adoption is growing much faster than LTE because its free and mobile data plans are too expensive.  Also, monitoring mobile data usage is hard and next to impossible.   AT&T's first step to curtail the usage of data on their network was to AT&T kills unlimited data plans.  The second thing they day was to install a tiered data plans & caps.  So what was the reaction by consumers?  More people buying WiFi iPads without 3G data plans.   Both Verizon & AT&T iPad 3G sales are suffering as a result.

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