Thursday, May 17, 2012

AT&T CEO’s Only Regret is Offering Unlimited Data Plans For iPhone

AT&T CEO’s Only Regret is Offering Unlimited Data Plans For iPhone
AT&T's CEO Randall Stephenson who spoke at the Milken Institute’s Global Conference, said that his only regret was to offer unlimited data plans to iPhone users when it was launched.

From New York Times:
“My only regret was how we introduced pricing in the beginning, because how did we introduce pricing? Thirty dollars and you get all you can eat,” he said in the on-stage interview at the Milken Institute’s Global Conference on Wednesday. “And it’s a variable cost model. Every additional megabyte you use in this network, I have to invest capital.”

Back in June 2010, AT&T killed the tiered unlimited data plans and switched to tiered data plans. It however allowed users to grandfather their unlimited data plans. But AT&T received a lot of negative publicity when it started throttling top 5% of the unlimited data plan users.

Stephenson also admitted that services like iMessage keep him awake at night as they're eating into company messaging revenues.
“You lie awake at night worrying about what is that which will disrupt your business model,” he said. “Apple iMessage is a classic example. If you’re using iMessage, you’re not using one of our messaging services, right? That’s disruptive to our messaging revenue stream.”

Stephenson also reveals that the board was nervous about the iPhone as they had concerns that it could transform their business model:
“I remember asking the question: Are we investing in a business model, are we investing in a product or are we investing in Steve Jobs?” Mr. Stephenson said. “The answer to the question was, you’re investing in Steve Jobs. Let’s go after this thing. And we went after it, and the rest is history.”

But Stephenson doesn't regret the decision to support Apple's iPhone, which has helped AT&T post revenues of $31.8 billion, up 1.8 percent, versus the year-earlier quarter and operating income of $6.1 billion, up 4.9 percent, versus the year-earlier quarter.

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