AT&T to increase home internet prices again for the second consecutive year

Since November 2024, AT&T has raised its internet prices by five dollars, and beginning December 2025, the company will raise its internet prices by another five dollars. This is the second consecutive year AT&T has raised its prices. Customers have self-reported price increases several times since 2023. AT&T claims these increases are justified based on rising costs and the need to sustain the quality of service.   

Customers will likely feel unsatisfied, given this is the second to third price increase in several years. AT&T has claimed the increases have stemmed from quality-of-service claims.

The Company’s Explanation

To justify the most recent customer price increase, AT&T stated “To continue giving you the customer service & support you deserve, the price of your home internet plan increases by /month, starting on December 1, 2025. 

In an interview with The Verge, AT&T Manager Jim Kimberly stated, we are adjusting the price of our internet plans due to our changing business needs, as well as income constraints, to continue providing the service quality our customers are accustomed to. We will continue to share service business increases and customer information on how increases will affect customers.’ 

In order to minimize the increase, customers are encouraged to sign up for Autopay and Paperless Billing, which will provide a discount with an eligible bank account and a discount with a debit card.  

Rising AT&T Costs vs. AT&T Record Profits

The AT&T management continues to cite increasing costs as the greatest business decision. Only last quarter, AT&T recorded 0 million in additional operating expenses. This, however, contradicts the recent record profits reported by the company.

During the same quarter, AT&T reported a profit of .9 billion, reaching a total of .3 billion in earnings throughout 2024. While the costs of operations may be rising, this evidence suggests the profits the company earns are significant. 

This imbalance has led to frustration from clients and industry analysts alike, and raises the question: if the profit margins are this high, why should repeat price increases be passed on to consumers? 

Who Is Affected and Who Isn’t

As reported, AT&T has said the price increase on AT&T Internet plans will include all clients except two groups: clients who joined last year, and low-income clients who signed on for the Access from AT&T program. These groups will be the only ones allowed to stay at their present rates, while all the others should expect the new prices to be effective in December.

The pattern of price increases has been documented in a customer case, specifically cited by The Verge. A customer who signed up with AT&T in 2022 and was charged a month now pays .38, and will pay more than a month once the new increase takes place.

Wider Trends in Increasing Consumer Prices

AT&T’s actions do not stand alone. Numerous large corporations in the US, including mobile carriers, streaming services, and internet service providers, have implemented repeated price hikes in recent years. These corporations cite cost inflation, increasing energy prices, and infrastructure improvements as justifications. 

Nevertheless, the ongoing excessive profit margins within these companies fuel speculation on whether the price increases are a simple reaction to cost inflation or a more calculated effort to boost profits in a declining growth industry. 

Providers like AT&T enjoy considerable market power, as internet connectivity is a crucial service in the digital economy. In turn, many consumers are left without other viable options. Since many people work, study, or enjoy entertainment at home, market power is easily transformed into pricing power.  

Industry Effects and Customer Frustration

Frustrated AT&T consumers have vented these feelings on social media and online forums. Many state that the constant increase in prices is not justified because service improvements are either nonexistent or hardly noticeable. Some users say they are willing to switch services, yet in most places, AT&T is one of just a handful of options.

Analysts have pointed out that the consequences of a increase are not concerning alone, but the aggregate impact becomes remarkable. That is an additional a year for a customer who pays a month. For millions of subscribers, this turns into hundreds of millions of revenues for AT&T. 

This is especially true for other providers, as price increases for any major company set industry precedent. This AT&T price increase will likely leave customers on the AT&T network seeking other competitors like T-Mobile and Verizon, who are on the rise with fixed wireless internet offers. 

AT&T remains focused on its infrastructure improvements and managing the most important factor for any company, customer satisfaction. The recently implemented price increases are due to the massive investments needed for fiber-optic networks and 5G extensions. AT&T has assured all stakeholders that their investments are due to improving and sustaining the service quality. 

That being said, customers not seeing the benefits will feel higher prices and lower quality service. There is a trust that could be further built with customers, or with customers that were recently acquired, through the release of information on service improvements using the price increase funds.

Anticipating Customer Behavior

Many customers will likely reassess their options once more. AT&T is still one of the largest internet service providers in the US, but the growing dissatisfaction with its internet options may allow AT&T’s competitors with more stable internet pricing to gain market share. 

AT&T’s continued increase in rates yearly means AT&T will likely face increasing scrutiny from consumers and regulators regarding the reasons for these hikes. The current situation suggests consumers tighten the burden by enrolling in discount systems like Autopay or Paperless Billing. Market participants know this logic. 

The recent increase is still in the range of AT&T’s strategic and pricing behavior. Most consumers are more likely to see the sustained increases of other operational prices and passable increases as patterns of increases conveniently offered to consumers. For millions of AT&T customers, the bills will continue to increase.