What are the differences between the AT&T and Verizon data plans for the iPad 2? Which is a better deal for me?

Please note that this Q&A refers to the AT&T and Verizon data plans available for the iPad 2 at the time of its introduction.

It is first important to note that there are three iPad 2 models -- the iPad 2 (Wi-Fi), iPad 2 (Wi-Fi/GSM/A-GPS), and iPad 2 (Wi-Fi/CDMA/A-GPS). The Wi-Fi only model does not support 3G networking on either AT&T or Verizon. The GSM-equipped version supports 2G/3G networking on AT&T and the CDMA-equipped version supports 3G networking on Verizon.

It is not possible to use the GSM-equipped iPad 2 on Verizon, nor is it possible to use the CDMA-equipped iPad 2 on AT&T. No iPad 2 requires a contract, and iPad 2 wireless plans are available on a month-to-month basis with both AT&T and Verizon, so data is not fixed as an expense to carry each month over a two-year period as it is for the iPhone 4.

However, as your hardware choice essentially requires you to pick a wireless carrier (or go with the Wi-Fi only model and ignore carriers altogether), it is important to evaluate the plans provided by both carriers to determine which is the best choice for you.

AT&T Options

AT&T offers two plans on a month-to-month basis for very light and heavier users.

The "very light" option provides 250 MB of data transfer for US$14.99 per month with additional 250 MB blocks of data either autobilled at an additional US$14.99 per month or setup to manually allow one to purchase additional 250 MB blocks of data at the same price after running out of the initial data allotment (or not use data over 3G for the remainder of the month).

The "heavier" option provides 2 GB of data transfer for US$25 per month. If autobilled, AT&T charges US$10 for each 1 GB over the initial 2 GB cap. If setup to manually allow one to purchase more data transfer after running out of the initial 2 GB, AT&T charges an additional US$25 for each additional 2 GB block (note the US$5 premium over two separately autobilled 1 GB allocations).

It also is worth noting that if you signed up for an "unlimted" plan with AT&T when the original iPad was introduced, the plan currently is "grandfathered" and you can transfer this plan to your iPad 2.

Verizon Options

Verizon offers four different tiers of monthly data pricing for the iPad 2. 1 GB of data is US$20, 3 GB is US$35, 5 GB is US$50 and 10 GB is US$80. Interestingly, there reportedly are no overage charges, one is merely alerted and encouraged to upgrade to the next tier when approaching the limit of an existing tier. Presumably, if you hit 10 GB of data transfer, you simply run out of data for the month.

Which is a better deal for me?

The better deal for you depends on how much data you will use on a monthly basis over 3G and how good you are at estimating your overall monthly data use (or your willingness to do without 3G data and only use Wi-Fi for the remainder of your monthly billing cycle upon hitting a usage cap or tier). Some scenarios may help you get a better idea of possible costs.

The "light" scenario represents someone who downloads a small amount of e-mail on a regular basis and occassionally browses non-video websites over 3G. "Moderate" use represents someone who downloads e-mail, reads news sites on a regular basis and watches a short video clip on a daily basis over 3G. "Heavy" use represents someone who downloads e-mail, reads news on a regular basis, watches a handful of short video clips each day and downloads a handful of full-length streaming movies each month over 3G. "Maximum" use represents somewhere in the neighborhood of 30 to 40 hours a month of full-length video streaming over 3G.

Keep in mind that the above scenarios assume that you accurately estimate your data use and make the most financially savvy choice on AT&T. If you signed up for 250 MB of monthly data on AT&T with the autobill or manual purchase option and used 1 GB of data over 3G, it would cost US$59.96 instead of US$25.

Ultimately, light data users are better off with AT&T and heavy data users are better off with Verizon, but the pricing will be quite close together for many. Consequently, one may be better off focusing on the quality and performance of the network in your area at least as much as price. Verizon has the reputation for being more reliable, but data is slower on Verizon, and this is worth taking into consideration as well.

It would be financially prudent to minimize data use over 3G whenever possible and sign up for the least possible amount of 3G that you can use comfortably and/or have the patience to do without 3G for the remainder of the month upon hitting a cap or tier.

A truly frugal iPad user, however, could buy the least expensive Wi-Fi only model for US$499 model and not pay for 3G service at all, opting only to use Wi-Fi at home and elsewhere when it is available.