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updated 12/9/2009 10:47:58 AM ET 2009-12-09T15:47:58

Wireless data hogs who jam the airwaves by watching video on their iPhones will be put on tighter leashes, an AT&T Inc. executive said Wednesday.

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The carrier has had trouble keeping up with wireless data usage, leading to dropped connections and long waits for users trying to run programs on their devices. AT&T is upgrading its network to cope, but its head of consumer services, Ralph de la Vega, told investors at a UBS conference in New York that it will also give high-bandwidth users incentives to "reduce or modify their usage."

De la Vega didn't say exactly how or when the carrier would change its policies, but he said some form of usage-based pricing for data is inevitable.

Right now, the carrier has a monthly usage cap of 5 gigabytes on its data plans, the same as other carriers. That's an ample allowance for most people, and gives them little reason to curtail their usage. AT&T also doesn't make it easy for subscribers to know how data they're consuming.

"We need to educate the customer ... We've got to get them to understand what represents a megabyte of data," de la Vega said. "We're improving all our systems to let consumers get real-time information on their data usage."

Just 3 percent of smartphone users are consuming 40 percent of the network capacity, de la Vega said, adding that the most high-bandwidth activity is video and audio streaming. Several applications on the iPhone provide nonstop Internet radio.

De la Vega also defended the network's performance, saying testing showed that AT&T's third-generation, or 3G, network was faster than that of competitors, and that major problems are concentrated in New York and San Francisco, which are packed with smartphone users.

AT&T is locked in a TV ad war with Verizon Wireless, which is touting its wider 3G network coverage. The two recently agreed to drop two lawsuits about their dueling claims.

Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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