AT&T Data Plans’ Biggest Losers: Femtocell Users

Smartphone user outrage over AT&T’s (s t) new capped data plans may be dying down, but another set of consumers could soon get fired up: femtocell owners. According to the AT&T femtocell product service agreement, “Normal charges apply for mobility data plans and features when using the AT&T 3G MicroCell.” Those terms haven’t changed, but the new data plans, which are now limited to 200 MB or 2 GB a month, stand to add significant overage charges to the bills of heavy femtocell users.

On paper, there’s much to like about femtocells. Akin to little cell towers, they provide pockets of solid coverage for the phones in your home. Your handset connects to the femtocell, which then routes your voice or data activities through a fast broadband connection that you provide. It’s a win-win: You get better service for your handset while the carrier enjoys more network capacity as your activities are offloaded to the Internet. The theory is sound, but as I pointed out in a GigaOM Pro report about these devices (subscription required), pricing practices are the potential roadblock.

The issue as it relates to the new, limited data plans is summed up nicely by Michelle Donegan of Light Reading: “For consumers, the femto price model means that they will pay AT&T for the Microcell to get better indoor 3G coverage, pay for the backhaul connection to AT&T’s core network, and pay AT&T to use that indoor 3G base station.” Worse yet, if a smartphone user forgets to switch over to Wi-Fi and begins to use 3G and the femtocell for data services, the data used counts against the now-limited smartphone plan. Which means there could be no mobile broadband data left to use where that user needs it most — outside of the home.

While AT&T MicroCell customers can easily avoid this problem by using Wi-Fi for data on their handset at home, not all of them will. I think there’s a better solution and it starts at the top: AT&T should stop counting data use against a customer’s plan when the handset uses a MicroCell for data. The handset’s 3G radio never touches AT&T’s wireless network, and both voice and data traffic is routed through the broadband connection a customer is already paying for — which may or may not be provided by AT&T. There’s no justification for the double-dip charge.

As I said last year when AT&T began to roll out the MicroCell offering, you’re paying the carrier extra money each month because they can’t provide you service that you’re already paying for. Back then, I thought the situation was bad as it could be, but apparently I was wrong.