AT&T Plots New Ways To Gouge Customers With 5G Phone Plan Upcharges

We are just at the early stages over the shift from 4G LTE wireless coverage to 5G. So far in the United States, only AT&T and Verizon have lit up their 5G mobile wireless networks, but coverage is limited to just a handful of cities and 4G LTE-trampling speeds are spotty at best.

However, once 5G networks become more prevalent and start blanketing the U.S. with coverage, we may see a shift in the pricing strategy of carriers. In fact, AT&T CEO Randall Stephenson remarked today during the company's earnings call that its 5G subscribers are almost entirely limited to businesses, which are using it as a LAN replacement.

However, the real eyebrow-raising comments came with regards to the idea of tiered pricing for 5G wireless service. The way it currently operates, most wireless carriers (unless you're using a MVNO) give you access to the full data speeds available to the network as long as you operate within the confines of your plan. That typically means that if you surpass your allotted data bucket or cross a certain threshold on unlimited plans, only then will your speeds will be reduced.

randall stephenson
AT&T CEO Randall Stephenson

“I will be very surprised if, as we move into wireless, [if] the pricing regime in wireless doesn’t look something like the pricing regime you see in fixed line,” Stephenson stated on the earnings call. Stephenson contends that many customers will be willing to pay a premium to get, for example, 1 Gbps wireless speeds versus 500 Mbps speeds. So instead of everyone getting access to the top speeds that the wireless network is capable of, AT&T is looking to split customers off based on how much they're willing to pay.

How exactly this will pan out isn't known at this time; Stephenson says that "We’re two to three years away from seeing that play out.”

AT&T's current mobile 5G service is limited to a select group of customers, and official pricing hasn't yet been announced. However, rival Verizon is charging an extra $10 on top of the pricing for its existing unlimited 4G LTE unlimited data plans for 5G access. T-Mobile, however, has said that it will not charge customers extra for 5G access once its network is operational -- at least not for the next few years.