ATandT to Offer Only Unlimited Texting Plan

AT&T consolidates its texting plan options to one unlimited text plan for $20, which starts Aug. 21.

Wireless carrier AT&T signaled the consolidation of options for consumers on its network by dropping its $10 bundle that offers 1,000 messages, which will be replaced by a $20 per month unlimited texting plan for individual customers and a $30 per month unlimited plan for families with up to five lines. The changes take effect on Aug. 21.

"We regularly evaluate our offers and are making some adjustments to our messaging lineup. Starting Aug. 21, we're streamlining our text messaging plans for new customers and will offer an unlimited plan for individuals for $20 per month and an unlimited plan for families of up to five lines for $30 per month," the company said in a statement to Engadget, which first reported the switch. "The vast majority of our messaging customers prefer unlimited plans and with text messaging growth stronger than ever, that number continues to climb among new customers. Existing customers don't have to change any messaging plan they have today, even when changing handsets."

The company's decision to focus on unlimited-only plans comes at a time when wireless carriers like AT&T, Verizon and others are working to lessen the bandwidth strain on their wireless networks. AT&T announced that starting Oct. 1, smartphone customers with unlimited data plans will experience reduced speeds once their usage in a billing cycle reaches the level that puts them among the top 5 percent of heaviest data users, a move that brings the company closer in line with its competitors' selection of data consumption plans.

The company noted these customers can still use unlimited data and their speeds will be restored with the start of the next billing cycle, and before those customers are affected, AT&T will provide multiple notices, including a grace period. Regarding the top 5 percent of data download users, the company noted these customers on average use 12 times more data than the average of all other smartphone data customers, and noted this step will not apply to the company's 15 million smartphone customers on a tiered data plan or the "vast majority" of smartphone customers who still have unlimited data plans.

Company officials said that even as they pursue this additional measure, it would not solve their spectrum shortage and network capacity issues. Nothing short of completing the proposed $39 billion deal for rival T-Mobile will provide additional spectrum capacity to address these near-term challenges.

While T-Mobile may eventually become the property of AT&T as the two companies plan a controversial merger, T-Mobile announced in April it aims to stay competitive with AT&T with its $80 Even More unlimited calling, texting and data plan on its 4G network. The plan is contingent on a two-year contract and features "no overage charges," according to T-Mobile. However, customers who exceed 2GB of usage per billing period, the company explained in the statement, "will still have access to unlimited data at reduced speeds until their new billing cycle."

When that merger occurs remains to be seen. The FCC has been evaluating for some time the relationship between this proposed transaction and AT&T's $39 billion bid for T-Mobile USA. The agency's ongoing review has confirmed that the proposed transactions raise a number of related issues, including, but not limited to, questions regarding AT&T's aggregation of spectrum throughout the nation, particularly in overlapping areas.

In a letter to FCC Chairman Julius Genachowski, Consumer Watchdog, an organization that advocates for taxpayer and consumer interests, warned the commission against approving the merger. "T-Mobile customers who are forced to migrate to AT&T's network will have to buy new phones, agree to more expensive rate plans or cancel their contracts and pay a termination fee," the group wrote. "Once known for its low prices, T-Mobile has already begun increasing its rates and decreasing options in anticipation of the merger."