Back in 2010, AT&T led the way toward the elimination of unlimited data plans and now the carrier is at it again. On Jan. 22, the wireless carrier will raise the minimum cost of a usable smartphone data plan from $25 to $30 per month. This comes as the carrier begins widespread deployment of its 4G LTE network across the country. 

Here are the new data plans:

  • $20 per month for 300MB
  • $30 per month for 3GB
  • $50 per month for 5GB
Here are the old data plans:
  • $15 per month for 200MB
  • $25 per month for 2GB
  • $45 for 4GB (with tethering access)

Much like how AT&T doubled the minimum cost of a texting plan to $20 earlier this year, the company is spinning these price increases as better “value” for customers. Unfortunately, the reality is that subscribers now have to pay $30 instead of $25 for a smartphone plan with enough data to actually use your smartphone and those poor unfortunate souls who opt for the cheapest plan available will now have to pay $20 for 300MB instead of $15 for 200MB, meaning they are being ripped off even more than they were before.

Overages for users on the cheap plan have gotten worse as well. Those who try to save some money by opting for the least expensive option get dinged with overages that are more than six times higher ($20 for another 300MB) than the $10 for an extra 1GB that those with the 3GB plan get. 

Here is the new base price of an individual AT&T smartphone plan (with texting and a usable data plan more than 1GB):

  • $40 per month for 450 minutes of talk
  • $20 per month for unlimited texting
  • $30 for 3GB of data
  • Total: $90 before fees and taxes

Sadly, Verizon’s prices are almost just as bad, except that it still offers a $10 per month texting plan (1000 texts) and does not have a somewhat malicious 200-300MB plan. If AT&T truly wanted to offer a $20 plan, then it should offer 2GB for $20 and 1GB for $10. Its prices are higher because it wishes to create a plan that is almost unusable to force overages or its users to bump up to a more expensive plan.

We suppose this is one way for AT&T to pay off the $4 billion in damages it now owes T-Mobile since the merger fell through.

AT&T’s last big rate change was slowly followed by Verizon. Will other carriers raise rates now as well?

 

Update: Small correction in T-Mobile payout amount.