As AT&T and rivals like Sprint Nextel Corp. (NYSE:S) and Verizon Communications Inc. (NYSE:VZ) attempt to deal with slowed growth in the U.S., AT&T has announced that it will curb smartphone sales to 2011 levels in order to reduce upgrade costs. The company is also considering linking data plans between smartphones and tablet devices. Currently, customers have to purchase separate plans for each of their devices.
Ralph de la Vega, head of the company’s mobile business, suggests that linking data plans will increase revenue and provide more value for customers. Additionally, de la Vega is pushing for reduced subsidies. Mobile service providers swallow a portion of smartphone costs in order to offer phones at a reduced price when customers sign two-year contracts. If de la Vega gets his wish, the company will reduce this subsidy in order to increase margins.