AT&T’s plan to offer subsidized cell service may not get off the ground floor; here’s why

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Earlier this week, AT&T CEO John Stankey said that the carrier could offer subsidized cellphone service as soon as next year. The CEO partially explained how this would work when he said, “I believe there’s a segment of our customer base where given a choice, they would take some load of advertising for a $5 or $10 reduction in their mobile bill.” But there is a strong possibility that this plan never gets off the ground.
According to Reuters, U.S. Senator Richard Blumenthal (D-CT) today demanded that AT&T stop working on a subsidized wireless plan; the senator stated that such a plan plans could eat away at consumers’ privacy protections. In a letter that Blumenthal wrote to AT&T CEO Stankey, the senator said, “Consumers expect that their phone and broadband providers are not spying on their phone calls and web browsing or using their private data for commercial gain.”

It needs to be pointed out that AT&T has yet to announce a subsidized wireless plan; even so, Stankey did say that with the carrier becoming more involved in advertising, it is moving toward such a service. As we mentioned in our original story, the carrier’s engineers are working on “unified customer identifiers” which would allow the wireless firm to offer targeted advertisements to companies. As a result, AT&T could charge advertisers more money to show ads to consumers that might be more receptive to them.

Blumenthal’s missive to Stankey included a list of questions related to the subsidized service. The Senator has requested an answer from AT&T by October 18th. The carrier says that it has received the letter and does plan on issuing a response.

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