After months of hype, Verizon Wireless today rolled out details on new family share plans that allow up to 10 devices to share voice, messaging and now data allowances. The plans will be available beginning June 28.
The new plans include unlimited voice minutes and messaging, with price differentiation coming from which device is being used and the amount of data to be shared. Smartphones are priced at $40 per month; basic phones at $30; netbooks, laptops, wireless modems and hot spot devices at $20; and tablets at $10 per month.
Shared data packages begin at $50 per month for 1 gigabyte, escalating to $60 for 2 GB, $70 for 4 GB, $80 for 6 GB, $90 for 8 GB and $100 for 10 GB. Overage charges are priced at $15 per gigabyte, or customers can add 2 gigabyte bundles for $10. Customers using BlackBerry devices will also be charged $15 more per month per device for access to Research In Motion’s Enterprise Server or similar enterprise server offerings.
By comparison, Verizon Wireless’ current family share plans are priced at $120 for two lines to share unlimited minutes, with each additional line priced at $10; $30 to add unlimited messaging for up to 5 lines on a plan; and smartphone data pricing beginning at $30 per device for 2 GB of data.
For those not interested in smartphones, Verizon Wireless will offer share plans for basic phones priced at $70 for two lines to share 700 anytime calling minutes, with each additional line priced at $30. An unlimited voice and messaging plan will cost $100 for two lines and will include 300 megabytes of shared data, with overage charged at $15 per 300 Mb.
Verizon Wireless will also be offering data-only buckets that will allow devices to share 4 GB of data for $30, 6 GB for $40, 8 GB for $50 and 10 GB for $60. Devices eligible for this package include wireless modems, netbooks, laptops and wireless hot spot devices priced at $20 per month, per device; or $10 per month, per device for tablets. Tablet devices will also include use of their mobile hot spot feature and are not required to sign a contract.
For new customers, the new pricing scheme may be a blessing, especially for those looking for the convenience of unlimited voice and messaging options. However, for current Verizon Wireless customers looking to compare, make sure your calculator has plenty of juice.
Throwing the numbers into the blender shows that the current offering would cost $210 per month (plus taxes and fees) for two smartphones to share unlimited calling, messaging and each have 2 GB of data. The new plans will charge $150 for the same two smartphones sharing unlimited calling, messaging and 4 GB of data.
Ramping up the number of devices connected to five smartphones would see the current plans priced at $450 per month, while the new plans sharing 10 GB of data would be priced at $300.
One catch is that current customers with unlimited data plans for their smartphones will be forced to give up that luxury with the new options. Verizon Wireless has been seeding this issue for about a year by cutting out that unlimited option for new lines of service, but those customers that have been long-time Verizon Wireless smartphone users, or were in the first batch to switch to the carrier after it launched the iPhone in early 2011, this could be a deal killer.
Verizon Wireless did report last month that consumers would be able to maintain their current unlimited smartphone data plans going forward, but only if they also refused to partake in device subsidies should they upgrade devices. This would also presumably mean that those customers paying full price for a new device would also remain untethered to a contract.
Another catch is that beginning June 28, these new rate plans will become the de facto selection for customers. The carrier will no longer offer smaller calling minute or messaging buckets for contract customers on family plans with at least one smartphone.
Single-line consumers could also feel a pinch as the entry level price for a smartphone will ratchet up from $70 per month (450 anytime calling minutes, no messaging and 2 GB of mandatory data) to $90 (unlimited voice calling, messaging and 1 GB of data.) Basic phone service that includes 700 anytime calling minutes, no data or messaging will be the carrier’s lowest-priced contract offering at $40 per month.
Many are not happy with the new deal, with CNet’s Roger Cheng noting that the new plans sacrifice flexibility and potentially lower prices for perceived convenience. Cheng adds that as a Verizon Wireless customer his current rate plan/usage pattern would bump him from paying $80 per month to $100 per month.
Competitive implications
Verizon Wireless’ move is likely to elicit a similar reaction from AT&T Mobility, which has hinted at its own shared data initiatives for some time. AT&T Mobility’s current rate plans for the most part mimic Verizon Wireless’ offering, though the carrier does throw in unlimited calling to all mobile phones when family plan customers select an unlimited messaging package; and it offers 3 GB of data for smartphones at $30 as well as an entry level data package of 300 megabytes for $20.
This migration could add further fuel to the marketing fire at Sprint Nextel, which has said it will continue to push its unlimited smartphone data feature to its impending LTE service launch. However, the difference is not as dramatic as the marketing hype may expound as Sprint Nextel currently charges $210 per month for unlimited calling, messaging and unlimited data for two lines, which lines up with Verizon Wireless’ new plans bundled with 16 gigabytes of data to share between two smartphones.
Analysts also noted that the new plans could have a positive revenue spin for Verizon Wireless as the carrier has laid out strong incentives for consumers to first move to a smartphone, and then to pick up larger data buckets.
“While at first blush this may seem to be a price cut for [Verizon Wireless] and may make the definition of [average revenue per user] a bit blurry, we view this as a very positive move for [Verizon Wireless],” explained Wells Fargo Securities senior analyst Jennifer Fritzsche, in a report. “The main benefit is to stimulate device adoption and usage on its LTE network. With a significant LTE coverage advantage over its peers, [Verizon Wireless] is in a solid position to make this move now and act on this point of competitive strength.”
Bored? Why not follow me on Twitter?
