May05

This week at the conference, AT&T CEO, Randall Stephenson had a lot to say about the company and iPhone. In particular, he said that he had regrets to offer unlimited data and free text messaging service like iMessage. He said that if AT&T had not offered unlimited data then it would have been a plus for company because we will get payment if people want to use more data. According to Randall, “Because of this offer, I was not able to sleep at night.”

Originally Posted by Randall Stephenson

“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.”
“You lie awake at night worrying about what is that which will disrupt your business model. 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.”
“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.”

AT&T once offered the unlimited data plan for most phones for only $30 per month, which is a very cheap price in comparison to the overpriced tiered data plans that are now plaguing cellular providers everywhere.

While Sprint continues to offer unlimited data and plans to do so even beyond the release of the next generation iPhone, AT&T and Verizon have moved past unlimited data, offering very limited services for almost the same price as Sprint wants.

Over all, Stephenson appears to have a lot of issues with the way the iPhone is running the phone industry today in terms of iMessage and cellular data. But he has no other options because closing the business with Apple would kill the company’s revenue dramatically.