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AT&T planning to let developers pay for users' smartphone data usage

AT&T has revealed that it is working on a system that would allow mobile software developers to pay for users' bandwidth use, in an approach likened to toll-free calling.

John Donovan, AT&T senior executive vice president of technology and network operations, said in an interview with The Wall Street Journal that his company is exploring ways to make money from increased data use on their networks, while also avoiding price hikes that could draw the ire of subscribers. Donovan likened the proposed system to the use of 800 numbers for free calls.

"(It) would say, if you take this app, this app will come without any network usage," Donovan reportedly said while at this week's Mobile World Congress in Barcelona.

AT&T executives believe the system could be a win for both consumers and the carrier itself, allowing third parties to shoulder some of the costs of mobile bandwidth.

He gave the example of a user who wants to download a movie on the go, but who has nearly reached their monthly data plan cap. The content provider selling the movie could cover the cost of the bandwidth needed to download the film, so that the user could still make the purchase and not go over their limit.


AT&T began capping smartphone data plans in June of 2010, just before the launch of the iPhone 4. Previously, iPhone owners were offered unlimited data for $30 per month. Its chief competitor, Verizon, also has capped data plans with a tiered pricing structure.

Last year, AT&T also began throttling the mobile data speeds of its heaviest users. In the U.S., Sprint is the only official nationwide iPhone carrier that does not cap or throttle mobile data usage.