Last week new AT&T CTO John Donovan let loose
that the company will begin testing "usage-based pricing" starting this Fall. "Traffic on our backbone is growing 60 percent per year, but our revenue is not," complained Donovan. Today AT&T spokesman Michael Coe tells The Street
that usage-based pricing is "inevitable." "Usage-based pricing is one way to deal fairly with Internet usage, which is very uneven among broadband users," says Coe. It's also a handy way to deal with Internet-delivery video providers who might compete with AT&T's U-Verse TV service.