Optical/IP Networks

Verizon Wireless Brings Unlimited Users to Tiers

Those Verizon Wireless customers who locked in $30 unlimited data plans before the carrier's switch to tiers will lose their grandfathered-in status when the carrier introduces shared data plans this summer. (See Verizon to Roll Out Sharable Data Buckets .)

Verizon Communications Inc. (NYSE: VZ) CFO Fran Shammo discussed the coming changes at the J.P. Morgan Technology, Media and Telecom conference Wednesday, telling attendees that when customers upgrade to Long Term Evolution (LTE) smartphones, they must also purchase data-share plans, which Verizon expects to launch by midsummer, and ditch unlimited data. He didn't say what happens if they stay on 3G, however; Verizon is only introducing LTE phones this year, so its customers will eventually need to upgrade. (See Verizon Goes All Out for LTE Smartphones .)

"A lot of our 3G base is unlimited," he said at the conference. "As they start migrating to 4G, they will have to come off of unlimited and go into the data share plan. And that's beneficial for us for many reasons, obviously."

Why this matters
Verizon stopped offering unlimited data plans last July, but the move only affected new customers or those who signed a new contract. Nixing unlimited entirely is likely to anger customers that were counting on avoiding the carrier's data caps. (See Verizon: Turn Tiers to Smiles.)

With the exception of Sprint Corp. (NYSE: S), all of the wireless operators have moved to tiered data plans with caps. But, for example, nearly 40 percent of AT&T Inc. (NYSE: T)'s customers are still on unlimited plans. Verizon didn't reveal how many have been grandfathered in, but in Light Reading's survey of readers in February, 71 percent of Verizon customers said they were still on unlimited plans. It's safe to say that a lot of people will be affected.

For more
— Sarah Reedy, Senior Reporter, Light Reading Mobile

digits 12/5/2012 | 5:32:49 PM
re: Verizon Wireless Brings Unlimited Users to Tiers

It's been a while since we put tiers to work...

mj42 12/5/2012 | 5:32:46 PM
re: Verizon Wireless Brings Unlimited Users to Tiers

I personally have three members of my family on old unlimited data plans. They don't do video or other high bandwidth applications, just web searches, google maps, facebook, etc. I would most likely have blindly stayed with verizon when time to upgrade so I could keep the unlimited plans and not have to worry about data caps. Now there is no reason to not look for the best deal I can get. I wonder how many other customers will do the same. Will verizon see an increased customer churn from this? The statistics at the end of the year will be interesting.

sarahthomas1011 12/5/2012 | 5:32:46 PM
re: Verizon Wireless Brings Unlimited Users to Tiers

I imagine a lot of its customers, like you, will be mad, but shared data plans could be a good thing. When I was on the family plan for texts, for example, I used up 3x as many as my mom, but collectively we never went over. I imagine your family would be similar, if no one is doing tons of video viewing. The caps probably won't affect you. 

mj42 12/5/2012 | 5:32:44 PM
re: Verizon Wireless Brings Unlimited Users to Tiers

I'm not so much mad as exercising options. With the old plans I didn't have to worry about how much data was being used. I didn't have to monitor three peoples usage, just looked every now and again out of curiosity. With a capped plan I will have to monitor the usage often to make sure there are no over cap charges. They can be very expensive for going over voice minutes or text message limits, I assume they will be just as painful for going over shared data caps.It adds a real hassel factor.

Once the provider requires me to choose a new plan I will not limit myself to just choosing among their offered plans but all plans I can get, theirs and their competitors. They'll have to be as good or better than other providers. I'm not sure they want to open that door for the bulk of their smart phone users. Keeping people happy and blindly renewing is always the easiest way to avoid churn. Those uncapped plans have to be real painful for them to open that door.

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