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AT&T caves to the competition, suddenly serves up a new unlimited data plan

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Competition's a beautiful thing. AT&T announced that it will offer unlimited data to new and existing customers.

It’s been a hectic week in wireless. First Verizon, the U.S.’s largest carrier by number of subscribers, announced it would begin offering an unlimited data plan. Following the news, T-Mobile added high-definition video and hotspot to its existing unlimited plan. Then Sprint, not to be outdone by the competition, raised throttling limits on its plans. Now AT&T’s throwing its hat in the ring.

On Thursday, the carrier said it would begin offering unlimited data plans to customers without requiring them to purchase AT&T’s DirecTV or U-verse television service.

AT&T’s offering, which goes live Friday, will effectively go toe-to-toe with Verizon’s new plan. It features four lines for $180, or a single line for $100. Each additional line runs $40, and customers can add an optional “Roam North America” feature that lets them call, text, and use data in Canada and Mexico for no additional charge.

More: It’s finally back — Verizon again offers its unlimited plan to eager customers

Subscribers will receive a $40 bill credit for a fourth line, effectively making it free. But it won’t take effect right away — for the first month or so, four-line plans will cost $220.

AT&T’s plan isn’t without caveats. It includes unlimited high-definition video, but not tethering — unlike Verizon, T-Mobile, and Sprint’s reworked plans, subscribers won’t be able to use their phones as a mobile hotspot. AT&T will slow down users when they enter busy or “congested” areas if they exceed a data threshold of 22GB in a month. And the new plan packs AT&T’s Stream Saver, an optional feature that downgrades the quality of streaming video to standard definition.

AT&T said Unlimited data customers will be able to turn off Stream Saver if they choose. “You are not required to use Stream Saver. You can turn it off once and it stays off,” an AT&T spokesperson told Ars Technica.

More: Carriers compete: Sprint launches unlimited deal after Verizon, AT&T do

Friday will mark the first time AT&T’s offered an unlimited plan to non-TV subscribers since 2010, when it officially killed its all-you-can-eat data tier. Grandfathered customers who’ve managed to hold onto the old plan won’t see their terms changed, but will be subject to a $5-a-month hike that’ll raise the total price of legacy unlimited to $45. That’s before a $40 access fee, which brings the total to $85 a month.

Current AT&T DirecTV and U-verse customers won’t be affected by Thursday’s announcement.

AT&T’s new unlimited plan stacks up somewhat favorably to the competition. Verizon’s unlimited plan starts at $80 for one line, up to $180 for a family of four. T-Mobile’s refreshed One plan, which includes HD video streaming and 10GB of mobile hotspot data, is $70 for one line, $100 for two lines, or $160 for four lines, with taxes and fees included. And Sprint’s unlimited plan starts at $90 for five lines of unlimited data with HD video and 10GB of mobile hotspot data for new customers.