It also covers this issue of whether T-Mobile could offer service, concluding that it can't. I'm still unconvinced. I'll keep you posted.
Friday, January 29, 2010
This is another piece that goes into more detail about the new Micro SIM that will be standard on the about to be released iPad.
I'm not sure I believe all the conclusions here, especially that it won't work with T-Mobile. To me, the most interesting part about all this is the fact that T-Mobile won't comment.
Will the iPad work with other carriers? Stay tuned…
Thursday, January 28, 2010
NOTE TO AT&T FLACKS
This is the kind of press you want:
Stop lying, fudging and avoiding service problems. Simply say you're spending tons of money to fix (or make better) your network. Even if it isn't true, this is what customers want to hear. Customers are either happy with AT&T service (so they don't care if you fix it) or they are unhappy (and want to hear it's being fixed). Whether it's better than Verizon or some study shows it's really great doesn't matter if you can't get a signal in your building. Service your customers either with a good network, or the promise it will be fixed soon. And then if you must slip in information about how it really is better than most other choices, fine.
Since it appears, for now, we iPhone users are stuck with you, here are some other tips on PR so you can at least stop annoying us more than is necessary:
1. Keep a lid on your execs spouting about data hogs and the need to raise prices. Data hogs are your best customers. Will people who use their iPads a lot also be data hogs? And no one believes your execs when they say that raising prices on some people will mean others will pay less. So just knock it off. Either raise prices or not. Don't hint at it.
2. Stop trying to blame imaginary iPhone hardware problems for your network. The iPhone is where most of AT&T's profits come from. So fix your network to work with it or shut up. I really will bitch slap someone if I buy an iPad and later read a planted press piece that the reason I can't get a decent 3G connection for $30 a month is because it was badly designed.
3. Treat iPhone customers the way they should be treated, as your platinum clients. Send us a nice e-mail talking about how you appreciate us and how valuable we are to you. Throw us a freebee now then then like some fun Apps or content. Maybe even a free week of service or cut the ridiculous charges for texting. Treat us like you don't want us to jump ship the minute we have an alternative carrier.
4. Stop floating anti-net neutrality politics in the press. Stop trying to fool us into thinking that if you aren't regulated you won't try to fuck us. We aren't stupid. Have the decency to fuck us behind closed doors by paying off politicians. And then keep quiet about it. I want to enjoy Jon Stewart clips on the Huffington Post without be distracted by some idiot saying that telecoms need FCC support to fund network improvements.
UPDATE: Seems like AT&T is getting on message. Nice guys:
So still trying to sort out all the news about Apple's new iPad and whether it was a vote of confidence (or surrender) to AT&T. Looks like more of a mixed bag, but I need more information. Here's one piece of the puzzle. An explanation of the new SIM card. (It's getting a lot of traffic, so you might have to hit the link a few times)
The post says: "In fact, from AT&T’s perspective, this is better than a software lock in some ways — you’re not going to be able to download a hack that gets you on another network, so you’re totally at the mercy of your carrier at choice for providing a compatible card."
Hmm… but how difficult really will it be for other carriers to come out with micro SIMs? Can't be that hard. And they have several months to get up to speed. I don't think the jury is out on this yet.
Wednesday, January 27, 2010
Apple announced it's long rumored iPad tablet.
Big news is that it's unlocked! And it offers "no contract" AT&T 3G service. And I was just writing about AT&T's poisonous contracts. Hmm… very interesting! More as this develops quickly…
Early termination fees are a poisonous drug that the big telecoms, and AT&T in particular, are addicted to. AT&T tried to quietly settle one lawsuit involving them while the FCC is investigating the issue:
While I'm sure that there are AT&T execs that enjoy the idea of customers having to pay to escape poor service, long term these kinds of contracts are bad for business. It creates incentives for AT&T to offer deals it can't really live up to (like getting more iPhone subscribers than it's cell towers can handle) and provides profits for failure when customers exit unhappily. Long term, failure isn't a good business model.
Does AT&T really want it's future to be tied to scams? Is it really unable to complete by trying to offer the best possible service? Does it really want to train a generation of cell phone customers to be wary of being ripped off?
One of the biggest growth areas in telecom has been "no contract" cell phones. This is a direct result of ETF scams. These kinds of "no contract" deals are really putting downward pressure on monthly service charges. AT&T has been forced to respond with it's own "no contract" deals with the "GoPhone." But despite AT&T's marketing muscle, profits from the GoPhone have not been amazing and AT&T's hopes that many customers would shift into full monthly contracts have not been happening.
Customers can tell the difference between reasonable ETF fees (especially for discounted phones) and unreasonable ones. Outrageous termination fees are going to create a customer base with little or no loyalty to brands, who will simply see phones as disposable devices that should be acquired and tossed based on whoever is offering the lowest rates.
AT&T is at a cross roads now that it will be losing iPhone exclusivity. Provide real service, build a real brand with a loyal customer base, or complete simply on the lowest prices. What kind of business do they want to be in? Do they want to be Chevy or Mercedes or Yugo? For several years, they didn't have to choose. They were charging high rates to iPhone users and making huge profits with marginal service. They also ran after the low price market with GoPhones.
Without the iPhone, or anything new to make up the difference, they will have to make a choice or see their profits fall apart over the next decade.
UPDATE - POST IPAD ANNOUNCEMENT: Did AT&T want to bury this settlement announcement prior to the "no-contract" deals Apple forced it to take for the iPad?
Tuesday, January 26, 2010
I suppose it's better late than never:
What's kind of weird about this piece is that Apple COO Tim Cook says "we've personally reviewed" these plans. Why do we need Apple to confirm that AT&T will really fix it's network? Oh, because AT&T keeps lying. It lied about tethering, it lied before about fixing it's network, it lied about why it stopped selling in New York, etc., etc.
This, of course, is a nice way of Apple kissing AT&T goodbye when it dumps them tomorrow as everyone expects and Verizon leaps in. Hopefully, this will finally be a wake up call for AT&T and they really will fix their network and try to compete on service.
Monday, January 25, 2010
So the big rumor today is that AT&T will lose it's exclusivity on the iPhone (no big surprise) and that it will be announced Wednesday when the new Apple Tablet is said to be revealed. (That is a bit of a surprise.)
Of course, AT&T flacks are out in force, trying to pre-spin this news. They ran to friendly blogger Tom Brady to get out their side of the story:
Brady has previously devoted columns to the widely discredited NYTimes piece claiming that hardware problems in the iPhone, not AT&T, were really to blame for AT&T service problems. (For some reason, the iPhone works great every where but in America. Maybe we have a different version with hardware problems.) He, of course, repeats this unsubstantiated bullshit and says it will be great for AT&T not the be the whipping boy for iPhone problems. Never mentioning why other carriers would want a defective product. (Oh, because it makes huge profits for them? But won't that mean AT&T profits will be hurt?)
Another blog post gets it right by saying that the announcement of AT&T's loss of exclusivity at the iTablet unveiling would be "hugely embarrassing" for AT&T.
But AT&T spin doctors do manage to get a little rub in at the end that maybe they'd be "happy" not to take the heat for service problems. Right…
With an end finally in sight, AT&T's mishandling of it's iPhone exclusivity opportunity has to go down as one of the biggest corporate tech blunders in recent history. The iPhone gave AT&T huge profits with which to have built out its network and be well ahead of any competitors. But instead, it gouged customers with needlessly high prices, denied problems and basically acted so arrogantly it alienated the richest and most tech savy group of trend makers in the technology sector: Apple customers. These are people who are known for brand loyalty.
The end of iPhone exclusivity should have been a question of "why?" to AT&T iPhone customers. Instead, they are going to packing up to leave like they are passengers on the Titanic.
Friday, January 22, 2010
Here's an interesting piece that talks about whether the coming Apple tablet will be exclusive to AT&T or Verizon:
The most interesting part is that 34% of potential customers DON'T want an Apple tablet if it requires an AT&T connection. OUCH!
So the most talked about, most anticipated, and desired device of the new decade becomes a turn off to customers if it's connected to the exclusive carrier of the iPhone? Wow, AT&T sure did a great job of angering Apple customers in a few short years!
What's sad is that AT&T execs probably don't react to numbers like this. They just assume that people are going to hate them. So they hate their customers back. They want their money, but they don't care if they're happy or not. They act as if their customers are ungrateful. They assume that no matter what they do, people will hate them.
Guys, it doesn't have to be that way! Honestly, it isn't that hard to keep customers happy. People love Apple, and it overcharges for it's products. It makes mistakes and sells crappy devices sometimes. It charges a huge nerd tax. But customers love it because they feel like it is trying. And it innovates. It tries to provide new things for people, rather than raking up rates on old things or preventing people from doing things they want to do.
There is no reason that people have to hate their cell phone provider. AT&T, take a serious look into your own heart. Why do you hate your customers so much? Is it… that you really hate yourself?
Deep down, don't you want to be loved? Isn't the reason that you hate your customers because you need love so much? But you have to make the first step. You have to reach out and offer a hug. Tell your customers how much you love them, and they'll love you back. There is still time. But you don't know how, do you? I'll tell you. Let Uncle Bell help you. I'll give you one simple example.
Give away free tethering on the iPhone. Now. It won't cost you much, and it will make millions of the most tech savvy iPhone customers extremely happy, very quickly. You could build huge loyalty almost over night.
Seriously, guys, consider it.
Thursday, January 21, 2010
A terrific piece on cnet breaks down the new cell phone plans being offered by Verizon and AT&T:
No big surprise, but Verizon and AT&T's recently announced "cuts" in cell phone rates really mask rate increases. Cnet breaks it down nicely. For most customers, rates will increase. (So why should we believe AT&T and Verizon execs when they promise that tiered pricing would mean lower rates for most customers?)
Also, as it's no big surprise that AT&T's rates and Verizon's rates are almost identical in every way. (How do you spell, "collusion?" Kind of like you spell price fixing.) Of course, the pricing packages are put together in as confusing a way as possible to make it difficult to compare the real costs of service (not even including taxes, etc). But the short of it is that Sprint costs on average $20 less a month than AT&T or Verizon and T-Mobile $40 less a month.
So what does one get for the extra money you pay to Verizon or AT&T? Verizon claims to have a better network. AT&T claims to have the best. Neither are much different. As far as I can tell, Spring and T-Mobile customers are just as happy, if not more, with their coverage. AT&T, of course, has the worst customer service ratings.
So right now the only thing AT&T has to offer for that extra $40 a month is that if you have an iPhone, you'll have no choice but to use their service. That seems likely to change soon, and real rate decreases will happen if you can move your iPhone service to T-Mobile over the coming year.
Until that happens, lets talk about why rates are confusing. Despite what AT&T execs and Verizon execs claim about "data" hogs and wanting to price cell phone service like "water" or "electricity" (how about pricing it like gold?), the real costs of cell phone service are in… service. It costs money to put the phones in stores, to sell them, to bill you, to answer questions, solve problems, all those things that require actual people (and sophisticated software created by people). Yes, you also need towers and electricity and computers and networks, but once those things are in place, the costs per customer don't vary much whether someone uses their phone a lot, or a little. It's pennies, not even nickels. Obviously, it costs to build capacity, it costs to expand coverage, but once that coverage and capacity is in place, flat pricing makes the most sense. Not only because the difference in a high use customer and a low use customer is marginal (pennies) but keeping track of all those "minutes" or data usage costs more in paperwork and computer time than the actual cost of use.
Unless, of course, you're charging a lot for that imaginary extra cost. For example, it probably costs $20 or so just to provide national cell phone service to a customer, whether he uses his cell phone a lot or a little. Then real difference between a high use customer and a low use customer might be as little as 30 cents in electricity. Keeping track of exactly how much each customer uses might cost an extra buck in paperwork, so you're losing money just bothering. That is, until you charge $30 more to the customer who's only costing you 30 cents more. Get it?
This is why all true low cost providers usually drop tiered pricing and go quickly to flat rates. It's not worth the paperwork unless you can convince people to pay extra for it. This is why in the early days of the internet, within a few years, all providers went to unlimited data plans. But big telecom has been fighting this ever since, because there's money to be made in the illusion that "data hogs" cost more. Thus, it's important for bills to be as confusing as possible.
But low cost providers like T-Mobile, calling cards, Skype, Vonage, are making it harder and harder to convince people that cell phone "minutes" are worth paying extra money for. So "unlimited" plans are becoming more and more common (notice they never call them "flat rate") for voice service. AT&T and Verizon can't continue to charge $40 more for the same voice service without offering something else.
So these big Teleco's are shifting the pricing away from voice and focusing on data plans. The new pricing really is about charging people for mandatory "data" plans. People with midrange phones that have lousy internet features now have to pay to use them. Whether they want to or not. Of course, maybe if people get used to using midrange phones for internet, they won't need iPhones and AT&T can stab Apple in the back. Hey, it probably won't work, but why not try?
The Holy Grail for AT&T and Verizon would be if they can somehow shift from charging for imaginary "minute" costs and charge for imaginary "data" costs. But customers scream whenever they bring it up. So in the meantime, they charge separately for extra services. $50 for voice, $20 for texting, $30 for internet, etc. Once again, these are imaginary distinctions. The costs of servicing a cell phone are about the same, whether someone uses texting or voice or data. But the illusion of providing extra service is something these big companies can demand extra money for. Here's a great piece by Stacey Higginbotham on Verizon's confusion in trying to figure out how to charge customer's for data:
So when are these companies going to stop playing games with customers by trying to rip them off with imaginary services? Why not offer "actual" real services that people would pay extra for? I would pay extra for a cell phone with switchboard services, meaning it could use more than one phone number and manage messages from more than one line. This is very technologically possible, but nope, no one offers it. There are businesses that would pay to have a live person take messages, why doesn't AT&T offer that option to the average customer? What about offering concierge service? How about some exclusive content? How about data storage? (Why can't I send old messages from my iPhone to a long term message storage site?) I would pay extra for tethering my iPhone tomorrow, but AT&T lied about providing that service a year ago. Why can every other iPhone user in the world tether but not AT&T customers?
Instead, what we get are announcements of "price cuts" that hide price increases. Maybe these huge corporations will keep getting away with this, but I suspect it's going to catch up with them eventually. Someone will provide real competition some day soon, and they simply won't know how to respond until it's too late.
Wednesday, January 20, 2010
Here's some real analysis about AT&T's network problems:
Funny, no mention of the NYTimes puff piece that quoted "experts" in saying AT&T's network was just great. Did AT&T flacks forget to wine and dine PCWorld? Or have they just given up trying to spin what great coverage they have?
AT&T had an incredible opportunity by being the exclusive carrier of the iPhone, but it squandered the profits and alienated it's customer base. This year, it will almost certainly lose iPhone exclusivity, and a large number of unhappy subscribers. What a waste.
Sunday, January 17, 2010
Friday, January 15, 2010
Coming right on the heels of Verizon and AT&T's winks at each other to collude on tiered pricing to limit and manage customers data use, they now want the FCC to allow them to violate the principles of net neutrality:
See how this works? First, you charge extra for extra data use, something that traditional internet providers don't do (or didn't until they were sucked up by giant telecoms). Then, you start offering free or lower priced content through your own channels.
With any luck, in ten years people will be forced to watch an AT&T channel because it's too expense to watch anything else, and a Verizon channel, and once again, big business will be in control of content.
You shouldn't have to pay extra for access to the full internet. That's a key principle of net neutrality. Big corporations shouldn't use customer's money to subsidize access to content they favor, that's another key principle. This a seriously slippery slope.
Cell phones are rapidly becoming one of the key ways people access the internet. If big telcoms are allowed to start favoring content on it, they could destroy the internet as we know it very quickly.
Here's one example. Maps. Several companies, including Google, offer free maps and directions to anywhere. These worked great on the big internet (your home computer) but work even better on the iPhone. For free you can find out where you are and how to get to where you want to go. This is a standard free feature. And if you don't like Google maps, there are alternatives that are also free, or charge a one time app fee. Great.
But AT&T tried to offer an iPhone mapping service and wanted customers to pay $9.99 a month for it. As far as I can tell, no one was interested and reviews on the iPhone app store were horrible. So it was a no go.
But bring in tiered pricing and allow cell phone companies the right to violate net neutrality and the game changes. First, AT&T starts charging per data bit. Maps are a lot of data and your bill goes up every time you use them. No more free maps, maps cost money suddenly.
So AT&T offers their own mapping service for "free" with no extra data charges. People use it to save money. Then what happens to Google maps and other free services? Well, they no longer are free, and worse, the money being charged to customers that use them doesn't go to Google but to AT&T. AT&T's free mapping service not only gets more and more customers (and market share) but also money from anyone that doesn't use them. Google and other map companies can't offer a "free" service that AT&T charges people for forever. So they stop offering these services.
Once that happens, guess what? Once the completion goes away, AT&T can start charging for it's own mapping service.
It is important for people to really understand that there is a war going on right now for control of the internet. And big telecoms, like AT&T and Verizon, want to completely control it. And seriously people, they have to be stopped.
Thursday, January 14, 2010
AT&T's PR problems have prevented it's flacks from getting out it's message that people need to get used to the idea of tiered pricing for the iPhone. So Verizon is taking up the banner:
How do you spell "collusion?" Take a look at the movie, The Informant, if you want to understand how big corporate collusion on price fixing works. The trick is, it's great for all the corporations to make a deal to fix prices and screw customers. But that's illegal. If you get caught. So what they do is all agree, without formally agreeing. (In the Informant they made the mistake of finally secretly meeting and actually agreeing in words.)
One way for them to agree, without secret meetings that might be taped, is to talk to each other in the press. So AT&T execs talk about how tiered pricing is needed, and then later Verizon execs nod their heads. Now there's absolutely no reason to piss off customers by floating around these toxic subjects in advance, but it's a great secret code for execs to talk to each other to agree on fixing prices.
The truth is, there is no technological reason for tiered pricing. It makes utterly no sense, other than as a quick fix to rip off customers and boost short term profits. In the long term, it's going to hurt these big telecom companies, but in the short term, it will help exec bonuses. Why should they worry about their customers? They only pay for their salaries.
Wednesday, January 13, 2010
It's just a question of time before Apple makes deals with other carriers:
But probably nothing is going to happen until the new Apple table comes out. And that is looking to be such a game changer, anything is possible.
Tuesday, January 12, 2010
Monday, January 11, 2010
This can't be good news for AT&T. A device that let's you get around playing high cell phone charges:
Actually… while this is a cute little toy, and might be embraced by some people who really can't afford much else, it isn't a real challenge to AT&T or other cell phone providers.
But this brings up a very important issue: the real cost of making phone calls is almost nothing. Yes, it does take considerable money to put all the infrastructure in place, but after that, it's just moving bits around for almost free.
So while this particular device isn't a big threat to big telecom, the threat is out there. Someone is really going to come up with a device that is a game changer, or build a satellite or figure out a new kind of cell tower, or something. You can't keep over charging for something that doesn't cost much.
But you can charge a lot for good service. So do the math AT&T. Stop floating plans to charge tiered pricing for data, 30 cents for texting and midnight minutes and other crap on top of your already outrageously high bills. Get your act together on the service front, provide real value for your customers, or wake up one day and find out that a company that only charges $20 a year for phone service has taken over your business.
Friday, January 8, 2010
The press just can't get any better for AT&T as everyone in tech media world assembles in one location so they can all find out their iPhone's don't work:
How much longer will AT&T have an exclusive contract with Apple?
Thursday, January 7, 2010
AT&T announced that it's going to try to broaden it's smartphone business by adding Android phones and Palm devices. Seems like it's preparing for a future where it can't count on gouging iPhone users to keep it's profits high. Even if Apple hadn't been planning to break it's exclusive deal with AT&T next year, all the bad press in this one must have forced it's hand.
AT&T also showed its "leadership" by chasing after the latest business strategy flavor of the month, selling apps. Here's the press release:
Yeah, it takes a lot of leadership to rush in and say, "Me too." Apple proved there is huge money in selling iPhone apps, a business no one had a clue could be so profitable until Apple got into it. We can't blame AT&T for wanting a piece of that action, and sure, on some of the lower end phones, perhaps there's some low hanging money to be made by copying Apple's lead. Nothing wrong with providing some options to people who can't afford (thanks to AT&T's over pricing of monthly service) iPhones.
But how about a little humility? How can you mention with a straight face that AT&T customers have access to over 100,000 apps as if that is something AT&T had anything to do with? But only if they have the right handset? You mean, the iPhone, right? The iPhone sells more than 99% of all smart phone apps. Come on, stop it already. AT&T already did this "customers have 100,000 apps" bit in the Luke Wilson commercial. It's time to give it a rest or state the obvious: AT&T has exclusive rights to the iPhone and the iPhone has lots of apps.
While it's hard to blame AT&T for wanting to get into the apps business, it's going to fail miserably. According to this announcement, it looks like it's going to focus on selling apps to phones that really don't have the power to run them, and to customers who choose cheap phones because they don't have money to spend on apps. So it's really a marginal market even if some genius were to try to tackle it, and lately AT&T hasn't been showing it has a lot of genius people in positions of power.
What's amazing is that as much as AT&T would like to model Apple's success with the App Store, it appears to be so jealous and hating of the iPhone that it can't see the the real business model that it could succeed at. AT&T makes tons of profits on the iPhone, yet provides such lousy service iPhone customers are literally begging Apple to bring in other carriers. AT&T knows the iPhone is the best mobile platform out there, and yet can't bring itself to mention it's name in advertisements touting it's features.
That press release above is almost two thousand words. Guess what word isn't mentioned? iPhone. How can a company that makes huge profits thanks to the iPhone not mention the iPhone in a press release about apps? It's crazy.
The real business model for AT&T would be to develop or encourage good apps for the iPhone, at least initially. That's where the real market is, and there's tons of money being made in it. Why not make great apps (or buy them from developers) and offer them first on the iPhone, then port them to lower end phones?
AT&T currently offers only a few iPhone apps, and none of them are must haves, or even nice to haves. One, AT&T Navigator, outrageously wants you to pay a additional $10 monthly fee for some simple mapping features. Out of two thousand reviews on the Apple Apps Store page, over one thousand are 1 star and very negative. Customers, justifiably, are really pissed off AT&T has the nerve to try to add to it's already too high monthly bill for such a lame app. Whatever little money AT&T has gotten from this app, and I'm sure it isn't much, isn't worth the negative PR it's created for itself by looking greedy, once again. No wonder AT&T doesn't even mention it's own iPhone apps in a press release about… apps.
Let's imagine a different approach at a different kind of AT&T. Imagine it offered that same app, for free, with no monthly charges. But the catch is, you have to be an AT&T customer. So if Apple does allow the iPhone on other carriers next year, you'd loose that app. If it was a good app, that just might be enough to keep you at AT&T, even if other carriers offered lower rates. Now, if AT&T was smart, it would have taken advantage of it's lead time with the iPhone to develop a lot of free apps that are only available to AT&T customers.
Those same apps could then be ported to other AT&T phones that weren't iPhones. The development costs and ongoing support could be shared. And yes, it doesn't all have to be free. AT&T could offer premium versions of apps that cost a little bit more. And perhaps even monthly fees for some premium features.
But AT&T just doesn't get it. It is so addicted to the idea of gouging customers each month that it can't really even think about other ways to make money. Like building a loyal fan base first and then making money from them. Like offering things for free before you try to charge for extra services.
Meanwhile, as AT&T is trying to play follow the leader by chasing after Apple's App Store, it's missing out on chances to break into the next business model that hasn't been exploited yet. One of which Apple will probably create with it's upcoming touch pad coming out soon.
Wednesday, January 6, 2010
I want to focus on a rare bit of good news coming out of AT&T. Not because I don't like focusing on good news, but simply because it's rare. AT&T announced that it was implementing software upgrades that will improve it's 3G network. I'm going to take the press release at face value and not try to assign it evil ulterior motives:
I'm sure deep in corporate headquarters, the big bosses get annoyed when people complain about AT&T's network because they know they have highly paid tech people working on it and they will be able to make announcements like this if we just give them time.
But that's not the point, big bosses. I know, everyone knows, you will fix your network eventually. The question is, what do you do about it now? The first thing is, don't lie. If you have problems, admit to them and say your fixing them. Don't spend millions in advertising trying to cover them up. And when people complain, give them so credit for having a point, be humble, and keep working on fixing the problem.
Is that too much to ask while we hand over a $100 a month of our hard earned money to you?
But in the meantime, thanks for this announcement, I'm sure these upgrades will improve the network. Then can we have free tethering?
Tuesday, January 5, 2010
So we now know that all of AT&T's promises about delivering tethering in 2009 were bullshit. This includes a lot of puff pieces that it was coming soon planted by AT&T PR flacks on various blogs. Here's a quick piece on the subject:
Oddly, it blames Apple for making a deal with AT&T to begin with. More to come on this subject…
Monday, January 4, 2010
Here's a brief piece on AT&T's year in review. Guess what, it's not a positive review:
The review points out continued troubles with AT&T service, but it's also interesting to note that most of the problems listed are basically PR problems. AT&T has to fix it's service issues, which it probably eventually will, but the question is, what kind of perception will people have of the company when it finally gets around to providing decent service? Right now, the company is losing a perception war very quickly. It's become a poster child for a bad corporation.
I'm sure AT&T execs look over long term plans and know that at the rate they are upgrading, eventually they'll handle traffic. But what if by the time that happens, they have serious competition, for example on the iPhone? How are they going to hold on to customer's that have had problems for years, and get new customers who have listened for years as AT&T's bad service become a one-liner joke?
AT&T has been playing based on an old corporate model that simply won't work in a new age. Buy up as much market share as you can, provide basic service at a premium rate, and brand yourself into a monopoly. AT&T either has to prepare for being the lowest cost provider, or offer premium service. Right now, it offers neither. It spends tons on advertising, but thanks to the internet, a small blog like Fake Steve Jobs can take over the media with something like Operation Chokehold, IF he points out something that is obvious to everyone. Like AT&T service in New York sucks and costs too much. You can't ad buy your way out of the truth anymore.
AT&T could have responded by apologizing for service, offering some rebates, promising (and delivering) to improve and won the PR battle. Instead, it responded by more huge ad buys of Luke Wilson saying vague things, planting fake stories, and burying it's head in the sand. It's not going to work and if AT&T doesn't change soon, it's going to have another bad year.