Verizon Wireless granted permanent status to a previously launched prepaid promo as it looks to remain an appealing alternative to T-Mobile, AT&T and Sprint
Verizon Wireless is putting the pen to previously launched enhancements to its prepaid rate plans in a move to find solid footing in a hotly contested market segment.
The carrier said beginning May 15, its smartphone-based prepaid plans will include three tiers priced at $30, $45 and $60 per month. The entry level plan will include unlimited domestic calling, unlimited text messaging across North America and a reliance on Wi-Fi for data. The $45 per month plan throws in three gigabytes of cellular data for customers signing up for an Auto Pay service, or 2 GB without; while the $60 per month plan bumps the data up to 6 GB with Auto Pay, 5 GB without, and throws in unlimited calling from the U.S. to Mexico and Canada.
Changes to the $45 and $60 per month plans were initially rolled out as a promotional effort in February, with those now becoming permanent. The unlimited calling from the U.S. to Mexico and Canada on the $60 plan is the one new addition to the plans.
Verizon Wireless continues to offer a pair of plans for feature phones, including 300 domestic calling minutes, text messages or multimedia messages – in any combination – and unlimited mobile web access for $15 per month; or unlimited domestic voice calling, messaging and mobile web for $30 per month.
The move would appear to be an appeasement towards the prepaid segment that continues to confound Verizon Wireless. The carrier said it lost 177,000 direct prepaid customers during the first three months of the year, which continued a long string of customer losses in the segment. By comparison, rivals T-Mobile US and AT&T Mobility posted robust prepaid growth across their MetroPCS and Cricket Wireless divisions during the quarter.
The competitive disadvantage on the surface does not appear to concern Verizon Wireless management, with Verizon Communications CFO Fran Shammo stating the carrier was happy to have its wholesale partners target prepaid customers.
“We’re really not competitive in that environment for a whole host of reasons,” explained Shammo, as part of the carrier’s Q1 earnings call. “And it’s because we have to make sure that we don’t migrate our high quality postpaid base over to a prepaid product. If you look at the competitive nature, they’re doing it with sub-brands. They’re not really doing it with their brands. And quite honestly we use the TracFone brand as our prepaid product. And TracFone has been extremely successful for us. It’s not something that we disclose any more on reseller. But it continues to increase on the high quality base of TracFone. So that’s really where we use and go after the prepaid market.”
The prepaid competitive pressure should continue as AT&T Mobility recently enhanced its Cricket Wireless and GoPhone efforts, while T-Mobile US late last month unveiled a new multiline promotion for its MetroPCS brand targeting customers porting their lines in from a rival carrier. Even Sprint, which like Verizon Wireless posted prepaid net losses for its latest quarter, has been juggling its Boost Mobile prepaid offerings and said it plans to revamp its Virgin Mobile USA platform at some point this year.
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