• Reconciling iPhone 4's Video Push With AT&T's New Data Plans

    To nobody's surprise, at Apple's Worldwide Developers Conference yesterday, Steve Jobs announced the new iPhone 4, a powerful machine with a focus on performance. It carries the specs of an iPad including an A4 processor and 800:1 contrast IPS display, along with a new 960x640, 326 pixels per inch "retina display," a pixel density that is indistinguishable to the human eye.

    The new iPhone also squarely emphasizes video use - video chat, video shooting and editing and a new Netflix app that Jobs was obviously so excited about that he brought Netflix CEO Reed Hastings up on stage to do his own short demo.

    Surprisingly though, the new iPhone's push to more video comes just days after AT&T published its new data plans that seem to disincent video-hungry power users. The new plans, which are slightly cheaper, cap users at 2GB for $25 a month with additional 1GB increments available for $10. While AT&T says that less than 2% of its users exceed the 2GB/mo threshold currently, surely new iPhone (not to mention iPad) users, tempted by all the tasty new video offerings, will start blowing through these limits, knowingly or unknowingly. In fact, it won't take much to exceed the limit; Clicker CEO Jim Lanzone estimated that just 1 HD episode of Mad Men will take up 1.51 GB, or more than 3/4 of the monthly allocation - before you've done anything else.

    It's important to remember that we humans are adaptable creatures (especially when financial incentives are in play!) so in this case many people will no doubt orient their video-heavy usage to when they're on WiFi networks and the cap doesn't count. Still, the idea that AT&T would put data limits in place just as Steve Jobs was ready to unveil his new baby and all its video features (therefore leading those of us in the cheap seats to focus on this conflict instead of the new iPhone's coolness), seems to beg the question - what's going on here between these 2 partners?

    Of course nobody knows, and Jobs himself has never had a cross word about AT&T or its services. Apple even came to AT&T's rescue when it was it was publicly spatting with Verizon last fall. Jobs himself couldn't have been surprised that AT&T, with its sorely overloaded network, decided at last to put data caps in place. And A&T's timing is never going to be good from Apple's perspective. In this case it probably decided, better to make the move in advance of the new iPhone's video-heavy features, rather than letting people get used to unlimited only to have to reel it in (there's nothing people hate more than having something taken away from them). Plus AT&T is grandfathering existing unlimited users and also offered a small window to still sign up for unlimited.

    All that said, with Verizon and Sprint still offering unlimited data plans (making competitive Android phones that much more attractive for video use), you have to believe that AT&T's new cap makes Jobs yearn for the day when the AT&T exclusive expires. Jobs has famously criticized Flash because it undermines his quest for product excellence; surely he's no less stirred (albeit privately) that AT&T's cap limits the full use and enjoyment of the new iPhone or the iPad.

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