In the world of technology, there are almost always two major and conflicting forces being exerted on providers and consumers: the continuous improvement of the service, and its longevity.  This has been evident for a very long time in both hardware and software: when you buy a new product, you want it to have all the latest bells and whistles, but you also don’t want to have to replace it every six months. This can be a delicate balance to strike, and can be the source of much frustration for all parties involved.

AT&T (Etilities Forum), like most wireless providers, is experiencing this squeeze as well: most of their consumer base has phones that use the 2nd generation ‘2G’ network, some have already moved to the third ‘3G’ generation, and already products are coming out that support tomorrow’s network, ‘4G’. Their challenge is therefore to extend their 3G network, plan ahead for the development of their 4G network, and encorage users to move away from 2G. The way that they are going about it, however, has the potential to be rather controversial.

Open For Business reports, with very convincing evidence, that AT&T has been downgrading the speed of its 2G network in order to encourage consumers to switch to 3G. Although this affects a number of devices, the spotlight is of course on Apple’s 1st generation iPhone, which was selling for $400 as recently as May of 2008. When considering all the different marketing methods that the provider could be using to encourage users to upgrade, such as discounts on both the product and the service upgrade, this seems like a rather unfriendly way to go about it.

Being personally a 1st generation iPhone owner, I found myself very much annoyed by this practice, and although I am eligible for a phone upgrade, it would still cost me about $200 for the new phone and $15 a month for the new plan, and I would then also be locked-in to a 2 year contract. And given the Apple’s exclusive contract with AT&T, unless I am willing to part with the iPhone altogether, my choices are quite limited indeed.

It’s not hard to see how frustrating this situation can be for consumers. I spend enough time covering various providers and services on this blog to know that this isn’t really specific to AT&T. It is not the great evil corporation that is alone responsible for all of our woes, and this is a free market: I’m perfectly capable of terminating my AT&T service altogether if I’m not satisfied. But there are ways to bring products and services to an end-of-life that have been proven to work: announce a scheduled end of maintenance well in advance, provide incentives to upgrade, offer continued support for a pre-determined length of time at additional costs… there are many more.

Purposely and unofficially downgrading the quality of your existing service, however, is a sure way to anger customers and push them over the edge to go to one of the many competing providers out there. Most consumers are reasonable, well-informed people who understand that technology needs to go forward and that therefore old infrastructures need to be rolled out eventually. But treating them like adults and being transparent is likely to yield better results than holding them hostage.

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