So why the difference? It’s easy to consume lots of data with an iPhone. With nine million on the AT&T network, they fear a complete meltdown if everyone used lots of bandwidth at once. The AT&T phone network, like every network, is designed with a certain “maximum capacity” in mind. It just couldn’t support every user at once. The data network is no different. If all iPhone users consumed every byte of their 5 gigabyte monthly limit, the network would have to pass 43 petabytes each month.

If we make the (erroneous) assumption that all this traffic is spread evenly over all geographic locations and hours of the day, every single tower would have to spit out a constant 16 Mbps stream, 24 hours a day. In the real world we know that towers will experience significantly higher traffic in densely populated areas and especially during peak hours. That’s not even accounting for handling calls at the same time.

Of course, AT&T knows that not everyone will use that much data. In fact, the average iPhone user only consumes 400MB of data per month, or about 1/12th their allotment. Users of other smartphones only use 30-40MB per month, or 1/24th of their 5GB plan.

And now- The Moral Conundrum: If you are paying for 5 gigs of data, shouldn’t you be able to consume all of those 5 gigs any way you want?

I am a heavy data user. I often stream music and radio over 3G in the car (both are allowed by Apple and AT&T). My iPhone is jailbroken and I’ve disabled the download limits imposed on podcasts and app downloads. I can also make Skype calls over 3G and watch YouTube clips at a resolution normally reserved for WiFi. I can also tether, which means I can connect to the internet with my phone’s data plan. I am a very, very bad boy as far as AT&T is concerned. With all of my extracurricular data use, last month I pulled 1.5Gb to my iPhone. Still, my hog-ish habits are consuming only 30% of the available 5GB.

I am using 375% more data than the average iPhone user and 3,750% more than other smartphone users. Further, I am breaking the rules of the network to get it. The 10MB download caps are in place to prevent people like me from degrading the experience for other users. I am essentially stealing bandwidth from users who play by the rules. Yet, I’ve paid for that data. Like your neighbor bittorrenting movies and slowing down the cable internet for the whole neighborhood, my 50MB podcast download over 3G takes away resources for everyone else on the same tower (users who, most likely, just want to check their email and get directions). Yet, I paid for my data just like your neighbor, and just like you. We simply use it more.

The failure is with the data providers, who sell everyone more bandwidth than they could ever possibly deliver. They know that some users will check email once a day, using a no more than few kilobytes, and others will stream video, upload pictures and otherwise max out the capabilities of their device. The light users, paying $30/month and using almost nothing, are subsidizing the cost of the heavy users who pay the same price and take significantly more. Imagine a grocery store that charges $100 to enter the door but every item inside is free. This would be a great bargain for a family of eight, and a horrible rip-off for the single guy who only wants a cup of ramen noodles. The store, meanwhile, continues to make money as long as they can sell $0.05 items for $100.00.

In the real world, of course, the ramen guy would choose to shop elsewhere and the store would quickly go out of business. In the world of cellphone providers, sadly, there just aren’t any other stores. AT&T won’t allow you to pay for only what you use. The problem is the increasing trend in data usage across the board. According to this study, data use is expected to rise at least 2X each year for the next five years.

In other words, all the shoppers are getting hungrier. Today’s hogs are tomorrows normal users. How can AT&T keep up with the exponentially rising data use from increasingly demanding mobile platforms? The one-size-fits-all model will simply fall apart. As people become more sophisticated in their consumption, they demand more and more bits. The shelves in our hypothetical grocery store will be raided by ordinary people with rising needs. This effect can be seen today, as thousands of people descend on sporting events or conferences, all expecting their phones to work as expected, and the network slows to a crawl. The business model doesn’t work for the grocery store because shoppers would either go elsewhere or take as much food as they can carry. It won’t work for AT&T for the exact came reason. There isn’t any competition, but in the very near future everyone will be using as much data as I am, and that demand will continue to grow without limit.

What AT&T needs to do, if they expect to provide all of their customers with a satisfactory experience, is turn that model on it’s head. Heavy users, like me, should be paying much more than ordinary users. In this way, the needs of the heaviest users will subsidize the development of more advanced network technology and bandwidth, which benefits everyone. Instead of ignoring the fact that the network is insufficient and slow for everyone, and cramping the needs of advanced users by trying to limit it’s use, AT&T should simply charge those heavy users more. Enthusiasts, those with the need to consume more data, are the ones willing to pay for the privilege of faster or unrestricted access. In the same way that, for example, photography enthusiasts pay a premium for cameras with cutting edge technolog, the money they spend on fancy cameras pushes the state of the art and those advanced features eventually appear in much cheaper cameras which appeal to average consumers.

Let the hogs bankroll the next generation cell networks so that regular users can reap the benefits of the hog’s addiction to the latest and greatest, the best and the fastest. I would gladly pay more for access to the bleeding edge, while more sensible people can pay less for only what they need.

Until then, I’ll continue to use as much data as I want, data that I have paid for. I don’t want my use of the network to degrade anyone else’s experience, but AT&T shouldn’t sell what they don’t have. Charging more money for more use is the only sensible solution. Not only would that reduce the strain on today’s network by eliminating needless waste and overconsumption, but it would also pay for the development of future technology, a benefit to all.

Today we will visit a tricky little topic: The Deposit.

Yes, we know you don’t want to think about it, but you better start now so you won’t be surprised on the 29th.

Here’s what you need to know:

How Much Is The Deposit?

Your deposit when signing up with the new AT&T will vary on your credit-history. Depending on that very history you could be asked to plunge down between zero and $800.

If you have a rock solid credit-history you probably have nothing to worry about. If you just started to build your credit, or god forbid, have a negative credit-history, however, $800 might be your destiny. Sorry.

Will AT&T Return The Deposit?

Yes, they sure will. In case you are required to pay a deposit, AT&T will keep your money for a 12 months period after which they will return it in full. Here’s the catch, though: If you are late on just one single payment, at any time during your 12 months period, your clock will be reset to 0 and you’ll have to wait another 12 months before your deposit will be returned.

Therefore, we strongly recommend you to sign up for Auto-Pay if you are required to pay any deposit. Don’t want to forget one of those payments…

When Can I Find Out About My Deposit?

I realize that this article is pretty much a downer up to this point. There’s some good news, however: You don’t have to wait until the day of your purchase to find out how much deposit you’ll be required to pay.

Simply locate the closest AT&T store, bring your Driver’s License and Social Security number and the AT&T employes can run a credit check for you. Within a few minutes you will know your fate.

See? No so bad…. Well, at least you won’t faint anymore on the 29th, and loose your spot in line, once you find out how much that iPhone will really cost you in the end.

Liked this article? Don’t forget to check out the previous articles:

- TAP Series: Switch to AT&T – Save 15% off your bill

- TAP Series: Switch to AT&T – Keep Your Number.

Thank you to SLAPSHOTW (interesting user name) for sending those in.

See it now? The above are two screenshots from Apple’s latest (Watered Down) and original version of its first (Never Been an iPod) iPhone ads. Apparently, Apple has removed the “Use requires minimum 2 year activation plan” from its latest ad.

In addition, Apple has now also replaced all of its original ads with the new version. Want proof? This is the same shot from Apple’s ‘Never Been an iPod’ ad as it appears on the website since earlier today:

Would Apple really go through this hassle if there haven’t been new developments with AT&T? Is it just a coincidence, that AT&T just yesterday announced its new GoPhone feature packages?

I honestly don’t think so! It truly appears as if AT&T might give customers a choice to purchase the iPhone without a two year contract. How will all of this play out? Let’s hope to find out soon.

But until then… here’s to hoping!

If you currently live in the 21st century, chances are that you depend on your wireless phone number like Paris Hilton depends on attention. You’ve given it to plenty of business associates, friends, and family members and the thought of loosing it scares you. It’s simply not an option! If that sounds like you, yet you still can’t live without an iPhone, you should keep on reading. Together we’ll take a look at how you can keep your current wireless number on your move to the new AT&T.

The trick that’ll let you ‘port’ your original number to AT&T is entitled ‘Wireless Local Number Portability’ (LNP). Sounds complicated. Is easy. According to the FCC:

Wireless LNP allows consumers to switch from one wireless carrier to another within the same general metropolitan area. It does not allow consumers to keep the same phone number when moving to a new town or city.

And even better:

Once a valid porting request has been made, the old carrier cannot refuse to port a number. Even if that individual owes money for an outstanding balance or termination fee.

“Aha,” you say! There’s the catch: A ‘valid porting request’. Sounds tricky. Breath, because it really isn’t.

I spoke to an AT&T representative this morning and asked him what customers should do if they want to keep their current number when switching over to AT&T. You’ll like his answer:

“Just come in, bring your previous wireless bill that shows your account number, and we’ll take care of the rest for you.”

The bill should be recent, and include your correct name and address as it appears in the carrier’s database. This should aid in making the porting process go smoothly. Once a valid porting request has been made by AT&T, the old carrier cannot refuse to port a number.

Also, according to the same AT&T representative this process “should be done by the time you walk out of the door” with your brand new iPhone. However, the FCC cautions on its website that the porting process could take approximately two and a half hours from the time the porting request is made of the old carrier.

Two and a half hours is the time frame agreed upon by the wireless industry, and the FCC encourages carriers to use that time frame.

So, all in all it’s very easy to keep your good old phone number while getting your hands on that brand new iPhone. Just make sure to bring your recent wireless bill [as well as a stack of cash] and you’re all set to go.

In case you have missed the 1st part of our series, make sure to read up on it now. You might be able to save 15% of your monthly AT&T wireless bills.

Also, please subscribe to our RSS feed so you don’t miss the next part of the series.

“We are focused on developing innovative ways to meet our customers’ communications needs while providing the best, most reliable and easiest service possible,” said Stephenson.

The Seattle Times Newspaper today interviewed Glenn Lurie, AT&T’s point man on the iPhone project, who revealed some new information about the device.

I think when people get their hands on it and really experience it — the touch screen is phenomenal, this touch screen is like nothing you’ve ever used — to experience that, the skepticism, I think, around some of those things will go away.

I’m the first one to admit, that I’ve been skeptical about the touch-screen for a long time. Who can blame me; I used to have a Dell PDA with Windows Mobile. However, more and more people keep hyping Apple’s patented touch-screen. There must be some facts behind the hype. I’m starting to believe.

There are other things — you have the widgets, some of the Google applications that are coming — there are just so many things here that the price will not be an issue.

Widgets and Google applications. So there will be a few new software additions that iPhone users can look forward to. Great.

One of the things with this device — people are going to be asked to have an unlimited package — people are going to have to have a package with us to browse. That’s one good thing for everybody.

In other words: ‘Get your credit cards ready, because we’ll be charging the hell out of your account every month starting in June. It’s a good think for….uhhmmm…. us…’

When asked to take out the iPhone that Lurie had been using for some time now he refuses: “Can’t do that.”

Why not? There might be more to the iPhone than even this interviews leads on to. Later this week we should hopefully know more, once the AT&T employees start their training on the device.

Stay Tuned.

Stories about the multi-touch screen, network performance, and battery life, for example. Where are they? Where?

You’ll know next Wednesday. That’s when AT&T will start to train its employees on the iPhone. It’s going to be a train wreck.

Here’s why:

Apple Inc. knows how to keep a secret, with a history of planting fake product names within the company to track down leaks. Hence, Apple employees have become particularly careful about leaking rumors to media outlets.

AT&T on the other hand…. Well, when was the last time you were dying to find out about an AT&T trade secret; back in 1964 when you couldn’t wait to get a glimpse of the new corporate logo?

Point Made?

What does this boil down to? Simple. AT&T has no experience in keeping a high profile product like the iPhone under wraps. Sure, Apple will try to extend their bullet proof ‘rumor protection shield’ from Cupertino to Chicago, however, we all know: The harder you stretch the more holes you’ll get.

In addition, AT&T employees might be very eager to finally receive their time in Apple’s Rumor ‘Spotlight.’ They are ready to press the ‘Anonymously Submit A Story’ button at MacRumors any second now. [Note to all AT&T Employees: TLAB loves you very much, so please send all your stories to us instead ]

Yes, Apple might be able to keep a good secret…well…secret, but it’s new partner, aka AT&T, will not. Mark our words.

So, here’s to all the juicy iPhone rumors. Let the games begin!!!

Does that sound like you? Great, because we’re here to help!

Beginning today, TLAB will run a series of posts that will help you switch over to AT&T from your existing wireless provider. We will touch on various topics such as ‘breaking your existing contract’, ‘keeping your original number’, ‘credit checks’, and a variety of other matters that you will want to know about in preparation for your switch.

Kicking of the series, here’s a neat little tip on how you can save 15% off your monthly wireless bills when you’re ready to sign up with the new AT&T.

In preparation for the series, I spoke with a local AT&T store employee, who informed me, that you will be able to save 15% of your monthly AT&T wireless bills if you are currently enrolled as a College or University student.

This offer is only offered in corporate AT&T stores (the brick and mortar kind) and students will need to present a valid student ID alongside their application. Make sure to specifically ask your local AT&T employee about this offer, or you might miss out.

I’m still working out the details in regards to which Universities can apply for this great offer, so stay tuned for more details and make sure to RSS our blog to get all the other tips and tricks of our series.

“AT&T has exclusive U.S. distribution rights for five years — an eternity in the go-go cellphone world.”

Five years? Apple must have truly gotten an amazing deal out of Cingular in order to agree to a five year exclusive arrangement. Or were they just desperate after Verizon turned down the iPhone deal?

And you thought your two-year cell phone contract was cut throat huh?

On Monday, AT&T entered the final phase of one of the biggest rebranding campaigns in marketing history as it officially changed the name of its chain of retail stores to AT&T from Cingular. [...] Our branding campaign is performing above projected levels, we are ahead of schedule and customer response has been very positive,” said Randall Stephenson, chief operating officer of AT&T.

The final phase of the rebranding strategy comes just in time for the launch of Apple’s iPhone in June. This move shows just how important the iPhone will be for the face of the new AT&T.

“The excitement around the iPhone launch is like nothing any of us have witnessed before,” Clark said.

Does this mean TLAB got it right and AT&T will start a new price war with the introduction of the iPhone? Again, only time will tell….

Engadget reports today that potential iPhone users can sleep easy, because the iPhone’s still a quad-band worldphone.

There’s been a lot of buzz these past couple days about the iPhone’s FCC filing and what it says — or rather, what it doesn’t say — about the handset’s internals. The fear basically revolves around the fact that a lack of testing on the GSM 900 and 1800MHz bands indicates that it lacks those bands entirely, but we can assure the globetrotters out there jonesin’ for an iPhone come next month that there’ll be a full range of RF spectrum waiting for you.

So, that sounds fantastic. However, besides the quad-band goodness, will iPhone users really be able to use their U.S. iPhone while traveling outside the country?

During his Macworld Keynote in January 2007, Steve Jobs announced publicly, that in the U.S. Cingular (or AT&T) will be the only carrier and the iPhone will only be obtainable in combination with a Cingular subscription. That being said, there is a fairly good chance (read 100%) that the iPhone will be simlocked, and consequently unusable in foreign countries. (And conveniently on networks other than AT&T’s.)

Sure, you could continue to use the AT&T sim card in, let’s say, Germany for example, however are you willing to pay the premium roaming fees of $1.29 per minute? (Or 99cents in combination with a $5.99 per month global rate plan.)

The much more likely scenario would be that you would want to buy a prepaid sim card from a local wireless carrier, or even sign up for a temporary contract while you are overseas.

But, does AT&T unlock their phones for you? According to the (rather unfriendly) AT&T representative, that I talked to this morning, the answer is yes. She assured me, that all Cingular (she used the old name, not me) phones could be unlocked by simply calling up customer care. I asked her, if the same rule will apply for Apple’s upcoming iPhone. She answered that with another question: “Is this going to be a Cingular product?” Quite obviously, she has no idea if AT&T will unlock the iPhone for you or not. So let’s look at the two possible scenarios we are facing here:

Option # 1: AT&T will allow customers to unlock the iPhone.

This would be great news for all globetrotters. You sign up with AT&T, get the iPhone, call customer care, and request your “subsidiary unlock key.” That’s it. You are free to travel the world with your shiny new iPhone. (And deeply impress some of your European friends while you’re at it, since the iPhone won’t be available overseas before the year’s end.)

On the downside (for AT&T at least), this would open the door for potential T-Mobile, Verizon, and Sprint customers to purchase an iPhone and use it on their networks instead of AT&T’s. Sure, there’s still that pesky, little two-year contract agreement, but there’s a way around everything.

Option #2: AT&T will not unlock the iPhone during its initial two year run.

This scenario would single handedly render the quad-band capabilities of the iPhone useless. Customers would not be able to use the iPhone overseas unless they decide to dish up AT&T’s roaming fees instead.

This would surely result into some angry customers, however, AT&T would have two measures in place to protect the iPhone from “unintended” use on other U.S networks. (Alongside the above mentioned two-year contract.)

Quite obviously, AT&T is in a tough spot here. Satisfying its globetrotter customers, and potentially risking misuse of the unlock code, or scaring away that customer base, but keep the iPhone tightly locked to the AT&T network.

Glad I don’t have to make that decision!

How would you decide?

EDIT: Silly me, Sprint and Verizon don’t even use the GSM system, and therefore don’t have SIM cards.

Update 6-9-2007: There seemed to be some initial confusion if the iPhone will actually have a SIM card slot or not. Today, AT&T’s leaked training manual now officially confirms that the iPhone will indeed carry a SIM card slot.