Skip to main content

AT&T (T) - Get Free Report is re-offering its unlimited data plans to all customers, not just those who subscribe to its DirecTV or U-verse television services, the company announced on Thursday. A DirecTV subscription typically goes for $35 to $60 a month, while a U-verse subscription costs $14 to $26.

AT&T's announcement came several days after rival wireless carrier Verizon Communications (VZ) - Get Free Report said it would begin offering unlimited data plans again.

AT&T, the nation's second-largest carrier, was the first to stop offering unlimited data plans to customers in 2010, with Verizon following suit shortly after in 2011. But with competitors T-Mobile (TMUS) - Get Free Report and Sprint (S) - Get Free Report   offering unlimited plans and going aggressively after subscribers, the two biggest networks are jumping back into the game again.

To match Verizon's offer, AT&T is now offering four lines for $180 with no television subscription service required. A single line is priced at $100, with each additional line running $40. The unlimited data plan also includes HD video and a "Roam North America" feature that allows users traveling in Canada and Mexico to use their unlimited plan for no additional charge.

The unlimited offerings at all four major wireless carriers come with some restrictions. AT&T said it may curb speeds for subscribers who use more than 22 gigabytes of data in a billing cycle, which is the same level as Verizon. This compares to Sprint's limit at 23 gigabytes and T-Mobile's at 28 gigabytes. AT&T will not allow subscribers to use their phones as a mobile hot spot, either, while Verizon, T-Mobile and Sprint all allow users 10 gigabytes of mobile hot spot data per month.

AT&T's shift to unlimited data is the latest sign of an industry reshuffling that may eliminate what analysts once believed to be a potential source of profits and growth.

"It's certainly a shift back to how things had previously been. They moved away from offering unlimited as a means to try to better monetize growth and data traffic, now it looks like we are going back the other direction with T-Mobile kind of pushing the market back that way," said Dave Heger, an analyst at Edward Jones. "So it kind of removes the ability for wireless carriers to be able to grow their revenue with the growth in data traffic."

Yet despite the potential loss in revenue, analysts see AT&T's offer for unlimited access as necessary given the closing gap in network quality and the increasing risk of losing subscribers to competitors. Meanwhile, with all four major networks now offering the same plan, price and network quality are now the only major points of differentiation.

"I guess it can be considered as a price war if you look at the different options in terms of tiers and data. You could have a situation where some people who are actually paying less on their plans might step up to an unlimited plan just for the thought about not overreaching," said Heger. "By the same token, people who are on plans that are on the higher end, those customers would probably get a price reduction."