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3G iPad Will Allow Data Upgrades for 250 MB Plan

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Apple has quietly explained what the cost will be for iPad owners to upgrade or extend 3G data service with AT&T in the middle of a billing cycle when you've opted for the 250 MB plan. This explanation is hidden at the bottom of the iPad 3G page that Apple posted several weeks ago.

AT&T is offering two plans in the United States: $14.99 per month for 250 MB of combined upstream and downstream data transfer over 3G, and $29.99 per month for unlimited 3G data. Unlimited AT&T Wi-Fi hotspot service is included whenever you have a 3G plan active, too. (We don't yet know about 3G data service pricing outside the United States.)

What wasn't known before was the upgrade cost if you have a 250 MB plan and want to extend service during a month, likely because you expect to use up your allotted bits. The bottom of the 3G iPad page shows an iPad screen capture along with text that's a bit opaque - so opaque I can't find any other Mac site having explained what's meant. I've also queried Apple for clarification, but so far haven't received an answer.

Image

The two options are to "Add 250 MB of data for $14.99" or "Change to unlimited data per month for $29.99" - the same price as for those two regular service plans. But the tiny text above the buttons reads, "When you select an option below, it will start when the current plan runs out of data or reaches the end date, whichever comes first."

That says to me that Apple and AT&T are using the situation as an opportunity to encourage users to switch to the unlimited plan and make some additional money in the process. If you try to lead a trim data life and save $15 by opting for the 250 MB plan but use up your allotted bits, you'll pay a full $29.99 to upgrade to unlimited during the month, or an extra $14.99 to buy just another 250 MB.

TidBITS editor Mark Anbinder suggested an alternate interpretation: that the monthly billing period restarts after you choose a new plan and you run out of data. In this case, a "month" is a flexible block of time (presumably 30 days) instead of a calendar month. That would be kinder - and cheaper - than my interpretation.

Either way, upgrading is a clever idea. Whether it's an update in the current billing cycle or the start of a new cycle, the charges aren't overage fees, those odious and insanely high 3G rates ($50 to $200 per GB) that carriers charge for laptop- and router-anchored 3G plans when you exceed a plan's data. The two upgrade options are limited fees between which you can choose quite easily.

The upgrade option is also a marketing tool for people who chose 250 MB initially but find themselves running out of data: if they switch to unlimited, then that's the plan in effect the next month (whenever that month starts). They've already paid as much as $44.98 in a 30-to-59-day period for 250 MB plus the unlimited upgrade, which makes $29.99 in subsequent months seem cheaper. And, if they forget to cancel in the following month, that's additional revenue for AT&T - but not so much to make users angry.

So far, the Apple and AT&T 3G pricing is striking a clever balance, and offering terms that no other carrier except Virgin Mobile - with its "buy data in chunks" plan - comes close to offering.

 

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Comments about 3G iPad Will Allow Data Upgrades for 250 MB Plan
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I took it to mean that when you chose one of the options, it started as soon as your existing plan ran out. So if you ran out on April 23, and signed up for the 14.99 option, you'd get 250 MB and your month would now end on May 23, at which time you'd get a fresh 250.
Glenn Fleishman  2010-03-23 21:23
Mark Anbinder thinks the same thing, and I've updated the article to reflect that as another interpretation!
David Chartier  2010-03-23 21:16
This still confuses me, so let's try a case scenario:

Say I opt for the $15/250MB plan, but 10 days into the month, I'm about to hit the ceiling. If I opt to change to the $30/"unlimited" plan, does that plan begin a NEW 30-day billing cycle whenever I reach the 250MB cap?
Glenn Fleishman  2010-03-24 07:10
That's Mark's interpretation; mine would be that you get 250 MB for the remainder of the billing cycle you're already in.
AHoffman   2010-03-24 07:56
When I read this last night, I did not even understand how Glenn's reading could be correct.

This is the error I think he's making: Glenn is assuming that month's are fixed, as opposed to a bit more fluid.

First, obviously a "month" is not a calendar month, right? We can agree on that. If you sign up on May 23, it runs to June 22.

Second, I think that Glenn believes that if you sign up on May 23 that your next month MUST start on June 23. I disagree. For the 250MB plan, you next month begins on June 23 -- unless you run out of data. If you run out of data, your next month starts whenever you run out of data.

So, as long as you are on the 250MB plan, you never pay less than $14.99/month, and keep paying another $14.99 each time you pass 250MB. Each time you pay that $14.99, it resets the date on which your month starts.

You could pay $14.99 every day, or multiple times a day.

So, the 250MB is not a monthly plan. It's a 250MB plan that expires in one month.
Glenn Fleishman  2010-03-24 08:41
I'm assuming based on the way in which the page discusses a "month" that a billing cycle month is meant, not a calendar month.

I agree with you that the month has to start when you start up the plan, but that doesn't mean that the "upgrade" starts a new month ticking when you run out of data - although it might!

You're misreading the 250 MB deal, however. The next 250 MB doesn't start to be used until the current data is exhausted, so you would not be able to pay $14.99 every day or multiple times per day.

Clarity from Apple would be useful, of course.