The Associated Press reports, and Stop the Cap! can confirm AT&T is allowing some of their long-standing customers to switch back to unlimited data plans, even if they gave them up after the company introduced cheaper, limited data plan options.

After our regular reader “PreventCAPS” sent word AT&T was relenting on some requests for unlimited data plans, we spent some time late this afternoon with Jim Scott, an AT&T customer from New Rochelle, N.Y. as he navigated his way through AT&T customer service trying to get back to an unlimited data plan.

“When AT&T offered customers new, cheaper data plans, I never knew those replaced the unlimited option and I thought I could save some money downgrading to a cheaper data option,” Scott told us.

But Scott discovered the plan allowances he got didn’t save him money at all, because he exceeded them.

“I am a contractor and I spend all day on my phone moving large image files and even video of work being done on the properties I manage,” Scott says.  “Two gigabytes didn’t cut it.”

Scott tried to switch back to his unlimited plan this summer, but was told he could not, as it was no longer offered.

Enter Verizon Wireless, which is keeping its unlimited service plan at least temporarily as it introduces the Verizon iPhone.  Verizon’s imminent iPhone has become leverage for customers who want to turn the tables on AT&T.

“Thanks to AT&T’s greed, I had already made the decision to dump them for Verizon when my contract ends in February,” Scott says. “AT&T works fine in this part of New York, and the only reason I am leaving is because they don’t have a wireless data plan that met my needs.”

We worked with Scott and suggested he threaten to cancel his AT&T service and walk his future business to Verizon Wireless.  We asked him to make sure to tell AT&T the reason he was planning to cancel his service was because of the end of unlimited data option.

On a three-way call with AT&T customer service, AT&T promptly offered to restore Scott’s access to its discontinued unlimited data plan.

“All I had to say was ‘Verizon’ and ‘iPhone’ and the customer service representative immediately starting clacking away on her keyboard, and I had my unlimited data plan restored in less than five minutes,” Scott said.

The AP reports the key to success is having been a previous subscriber to AT&T’s unlimited data option.  New customers who signed up after June 2010 never had that option, and AT&T has refused to offer unlimited data to these customers.

Because newer customers are under relatively new contracts, actually following through on a threat to drop AT&T is an expensive proposition with early termination fees still well into the hundreds of dollars.  For those closer to a penalty-free exit, AT&T recognizes many of these customers already have one foot out the door.

Jose Argumedo, of Brentwood, N.Y., told the AP he and a friend were switched to an unlimited plan recently after they called AT&T’s customer service. Both have iPhone 4s, and previously had earlier iPhone models.

AT&T spokesman Mark Siegel wouldn’t confirm the option to return to an unlimited plan.

“We handle customers and their situations individually, and we’re not going to discuss specifics,” he said.

Scott says he is comfortable with his iPhone, but getting back an unlimited data plan was more important than the handset.

“If I can use the iPhone as leverage against these guys, why not?” Scott says.  “They’ve had me under their thumb for more than six months now with overlimit fees — now the table is turned.”

Stop the Cap! advises customers who want to follow in Scott’s footsteps get organized before calling:

1. Be sure to note the number of years you have been an AT&T customer;
2. Explain you used to have unlimited data and now want that plan back;
3. Tell them you are prepared to drop AT&T, even at the risk of a cancellation fee, if they don’t restore your access to the unlimited data plan.

If a representative is unable to make the switch, or doesn’t have information about how to switch you back, ask for a supervisor or hang up and call back.

If you use Verizon’s forthcoming iPhone as a Wi-Fi hotspot, be prepared to pay $20 a month for a maximum of 2GB of usage per month.

Many smartphones have built-in capabilities to serve as temporary hotspots to let you use your Wi-Fi capable equipment on Verizon’s wireless 3G network.  But that doesn’t mean Verizon will let you use it for free.

The so-called “personal hotspot” enables up to five Wi-Fi equipped devices to share your connection, but not too much.  If you exceed your 2GB plan allowance, the overlimit fee is a striking $20 per gigabyte.  Those fees come in addition to your usual Verizon voice and data plan charges.

Verizon is not singling out the iPhone for the expensive data plan.  The pricing is equivalent to what Verizon charges for a similar service on its other smartphones, according to Brenda Raney, Verizon Wireless’ executive director of corporate communications.

Verizon's iPhone Herd Mentality: Pay, pay more, and pay again.

We’re still trying to wrap our heads around this “deal” spotted in the Verizon iPhone FAQ by Gadgetell (underlining ours):

I just purchased a new smartphone during the holiday season, but if I knew that iPhone 4 was going to be available soon I would have waited. What are my options now?

Current Verizon customers who purchased and activated new smartphones, feature phones or certified pre-owned phones between 11/26/2010, and 01/10/2011, are eligible to receive up to a $200 Visa debit card when they purchase an iPhone 4 at full retail price by 02/28/2011 and return their existing phone. Note: This offer is only available on consumer accounts with five lines or less, who are purchasing iPhone 4 through Verizon Wireless retail stores, telesales, or through verizonwireless.com.

So, if you have recently bought a new Android or Blackberry phone during the holiday season, you can turn it in and essentially get your money back.  But Verizon isn’t giving you $200 — it is paying only as much as you spent on the phone to be returned, up to $200.

Verizon says that earns you the right to go and get in line to pay full retail price for a new iPhone in February.  No discounts or subsidies for you!  The 16GB iPhone runs $649.99 and the 32GB iPhone costs $749.99.

We’re basking in the savings.  Gosh, thanks Verizon!

Not only are customers giving up Verizon’s “new handset subsidy” — often worth hundreds of dollars, they also lose their New Every Two discount and other savings from promotions like Verizon’s Smartphones Talk Free $9.99 monthly discount for 24 months.

For those who simply must have the iPhone, Verizon will make you pay dearly for not waiting.

Having owned the iPod Touch (essentially the iPhone without the phone) and Motorola’s Droid X, I can testify the price penalty Verizon wants you to pay for the iPhone isn’t worth the asking price.  Move on, there is nothing to see here.  This is even more true considering the next generation of the iPhone will likely be introduced in just four months.  What will you do then, and how much do you think Verizon will extract from you all over again to get that phone?

There is no doubt Apple’s iPhone is a fine phone, but there are cheaper ways to get one, ranging from opening a new line on your Verizon account and passing your old phone down to a family member, to finding one on eBay, subsidized in part by selling your existing phone.

Unless you own Sprint’s premiere smartphones — the Evo 4G and the Epic, get out your wallet — Sprint is increasing the price on its unlimited data plan by $10, effective later this month.

Evo and Epic owners already pay the $10 “premium data” fee that will be extended to all smartphone customers Jan. 30 (customers on existing contracts will not be affected).

The reason for the price increase?  Heavy usage on its wireless network, which partly includes Virgin Mobile (ending its unlimited service Feb. 14) and Clearwire, which heavily throttles speeds of customers deemed to be “using too much.”

Chief executive Dan Hesse says Sprint will retain its unlimited service plans, which the company calls the best value in the wireless industry.  But the pricing change will present minor challenges as Sprint markets themselves as the least costly.

Sprint's marketing focuses on its unlimited use offers, some of which are about to get more expensive.

Sprint’s “Everything Data” plan, which also includes unlimited cell-to-cell calls will now cost $79.99 per month.  Comparable plans from T-Mobile are priced at $99.99 for that company’s 4G network and $119.98 on Verizon Wireless’ slower, but more ubiquitous 3G network.

“Sprint has been the price leader in the market,” said Jennifer Fritzsche, a Wells Fargo & Co. analyst in Chicago who has an “outperform” rating on the stock. “Sprint may be more confident in the pricing power it has with customers.”

The Wall Street Journal also shares positive views of the price increase from Wall Street:

Wall Street applauded the move, with many seeing it as a sign of pricing power returning to the wireless industry. “It is more likely that Sprint believes that consumers value unlimited and that they can get away with higher pricing,” said Jonathan Chaplin, an analyst at Credit Suisse.

The price hike also suggests that Sprint has seen stronger smartphone growth over the past three months, he added, noting that the carrier likely wouldn’t have made the change if it were still concerned about stabilizing its base on contract customers.

But some other analysts are less impressed with Sprint, especially because of challenges the company faces with its Clearwire partnership.

Patrick Comack from Zachary Investment Research has downgraded Sprint stock, particularly because of technology issues Clearwire faces.

Comack told CNBC Clearwire is stuck with defective spectrum for much of its wireless broadband service.

“It can’t penetrate walls,” Comack said, noting most Clearwire customers are trying to use wireless broadband in the 2GHz range, which presents plenty of problems from obstacles between the tower and the customer.

Comack also believes Sprint’s network simply cannot compete with Verizon Wireless, which he suspects could pick up a number of Sprint customers once it fully activates its 4G network nationwide.

Verizon Wireless network delivers significantly better coverage than Sprint, which focuses on urban and suburban markets, and the major highways that connect them.

[flv]http://www.phillipdampier.com/video/CNBC Sprint 1-12-11.flv[/flv]

CNBC: Debating Sprint and Clearwire, with Todd Rethemeier, Hudson Square Research and Patrick Comack Zachary Investment Research.  (6 minutes)

(Thanks to Stop the Cap! reader PreventCAPS for sharing the news.)

Verizon’s silence on data plan pricing for the coveted Apple iPhone is deafening.  In the absence of definitive information, Verizon’s refusal to comment Tuesday about what it plans to charge its data hungry iPhone customers has triggered rampant speculation.

On Monday, the Wall Street Journal reported Verizon was going to keep pricing stable for its unlimited data plans and extend them to iPhone owners, if only to further tweak AT&T’s stingy data plan allowances and pricing:

Verizon Wireless, the country’s largest wireless carrier, is confident enough in its network that it will offer unlimited data-use plans when it starts selling the iPhone around the end of this month, a person familiar with the matter said. Such plans would provide a key means of distinguishing its service from rival AT&T Inc., which limits how much Internet data such as videos and photos its customers may use each month.

But that was before Verizon officials conspicuously avoided answering direct questions about data plan pricing at Tuesday’s press event.  Verizon’s FAQ for those interested in the iPhone doesn’t help (underlining ours):

Are there minimum service and data pricing requirements?

Yes, iPhone customers will need to choose from any of the current Nationwide plans. Customers will also be required to activate a data package, pricing will be announced at a later date.

ComputerWorld seemed to deliver the highest predicted inflation rate of Verizon’s data pricing — guestimating it will cost iPhone owners up to $120 a month for unlimited wireless data:

“Data plans for Verizon iPhone could range from $20 to $90 a month or even $120 unlimited a month,” Rob Enderle, an analyst at Enderle Group told the publication. “The iPhone uses an awful lot of data, so they will have to charge heavily for data and it will be fairly expensive.”

If Verizon wanted to find some way to kill Apple iPhone addicts’ enthusiasm for the phone on Verizon, charging a potential $330 a month for a single line plan is probably the way to do it.