Verizon to Roll Out Sharable Data Buckets
Verizon CFO Fran Shammo revealed the plan on the carrier's first-quarter earnings call Thursday, but didn't elaborate much. Verizon reported a solid quarter driven by growth in its postpaid wireless business, but Shammo said its attention is turning away from just adding more devices to its network to eking out more value from the devices that are latching on. (See Verizon Earns $3.9B as Data Usage Jumps ).
"We're extremely pleased with the growth of wireless business," Shammo said. "There will be other categories that drive wireless growth in the future," he added, referencing the data-share plan coming in mid-2012 that will let customers dip multiple devices into one bucket of data. That sharing would be extended to tablets, phones and machine-to-machine connections, which have been subject to increasingly complicated data plans.
Verizon has said it is looking at data-sharing features similar to what it offers families for voice and text buckets, but this is the first time the carrier has put a deadline on this sort of plan. Now that it no longer offers unlimited data, a sharable bucket of data could offer customers more flexibility. (See New Data Plans Keep It in the Family .)
The main reason Verizon is turning from net adds to data growth is that it had strong device sales across several categories in the first quarter. The carrier sold 6.3 million smartphones, including 2.1 million Long Term Evolution (LTE) phones. Now, 8 million, or 9 percent, of Verizon's customers are using LTE devices.
At the same time, it sold 3.2 million iPhones, but the carrier downplayed Apple Inc. (Nasdaq: AAPL)'s smartphone in favor of talking up LTE. (See Verizon Goes All Out for LTE Smartphones .)
For its customers that upgraded in the quarter, 42 percent were first-time smartphone buyers. Shammo said Verizon is looking at converting the 53 percent that still use basic phones, as well as increasing average revenue per user (ARPU) for those customers. The average customer today spends $54 per month, $23.80 of which goes to data.
"We are very, very confident that we're on a path to accelerate the growth of our ARPU," he said.
LTE network update
Shammo reiterated Verizon's LTE leadership as well, noting that it has turned on the network in 230 markets, covering more than 200 million PoPs or two-thirds of country. It plans to have its nationwide 3G footprint covered by LTE by mid-2013, and Shammo said that consumer awareness of Verizon's LTE network is on the upswing. (See Verizon's LTE Blitz Reaches Two-Thirds of US and Where's Verizon's 4G Going Next?)
The CFO also mentioned that Verizon is interested in supporting a third platform, giving a nod to emerging players like Microsoft Corp. (Nasdaq: MSFT)'s Windows Phone. Verizon gave Android a boost in the beginning, he said, and it's looking to do the same with "the third ecosystem."
— Sarah Reedy, Senior Reporter, Light Reading Mobile