By Matt Buchanan

AT&T Chokes Unlimited Data Dead. Dead Dead Dead.

AT&T Chokes Unlimited Data Dead. Dead Dead Dead. If you've still got an unlimited AT&T data plan that you're holding onto for dear life to stream gigs of Spotify and Netflix and god knows what else, your life is about to suck a lot more.

The all-you-can-eat-as-fast-as-you-want data plan as we know it is gone. But it gets worse.

The official word:

Starting October 1, smartphone customers with unlimited data plans may experience reduced speeds once their usage in a billing cycle reaches the level that puts them among the top 5 percent of heaviest data users. These customers can still use unlimited data and their speeds will be restored with the start of the next billing cycle. Before you are affected, we will provide multiple notices, including a grace period.

That means there's effectively a rolling cap for people with an unlimited data plan: If you're in the top 5 percent of data users in a month, your internet's going to be slowed down for the rest of the month. It won't apply to anybody that's on a tiered data plan and paying for every byte they use.

AT&T says that "to rank among the top 5 percent, you have to use an extraordinary amount of data in a single billing period." Sounds reasonable. But! How much data is the top 5 percent using? Well, consider that a year ago when AT&T moved to tiered plans, AT&T said that 2GB satisfied 97 percent of their customers. No doubt, that number's shifted a bit over the last year, as services like Rdio and Netflix have gotten more popular but 2GB is probably not a bad baseline to start potentially sweating over. Speaking of Rdio, that's exactly who AT&T's complaining about—people who are "streaming very large amounts of video and music daily over the wireless network, not Wi-Fi" or using "streaming video apps, remote web camera apps, sending large data files (like video) and some online gaming."

While AT&T makes the point that this slowdown business is never going to screw normal users by definition, since as the average data usage grows, so will the cap, it does effectively kill unlimited data for the people who most rely on it. Verizon's doing the same thing, slowing down its top 5 percent of data users. And T-Mobile throttles users who bust their allotted cap for their month. Throw in rumors that Verizon (and I'd suspect AT&T) are pushing to only allow FaceTime chat for users with tiered plans. They're all effectively throwing down: Speed or volume. You pick. But you're gonna pay for it, one way or another.

Neither AT&T nor Verizon are saying how much they're gonna slow down the big bandwidth eaters, but T-Mobile officially slows down data overeaters to EDGE speeds. (Unofficially, there are isolated reports of T-Mobile throttling to be so severe phones are practically unusable.) God knows it can't be much worse than some of the speeds I see in NY on my iPhone.

The thing is, AT&T isn't full of shit when they say bandwidth on mobile networks is not an infinite resource. It's true that there's only so much backhaul and so much spectrum. What's shitty is that AT&T is using this as another ploy in their PR war to convince people that the T-Mobile merger has to happen, that if if it doesn't, their service—which is already miserable (if improving) in NY, SF and LA—is going to continue to get worse as people simply expect to get what that they pay for from their data plans and smartphones. AT&T's essentially holding their own services hostage, even while for the last couple of years they kept telling us how things were going to get better.

So when do things start getting better? [AT&T]