Verizon to Unlimited Data Plans: We Are Never Ever, Ever Getting Back Together

Like scorned lovers out of a Taylor Swift heartbreak sonata, Verizon head Lowell McAdam said in an interview that it will never again offer unlimited data plans. The nation’s largest carrier says that unlimited data is just not sustainable, especially in an age where consumers are consuming more videos on mobile broadband pipes, like those delivered by Verizon through its speedy 4G LTE network.

“With unlimited, it’s the physics that breaks it,” McAdam told CNET in an interview. “If you allow unlimited usage, you just run out of gas.”

Verizon had led fierce rival AT&T Mobility in a path last year that saw the end to unlimited data plans. Instead, Verizon offers tiered data plans that allow customers to share data on multiple devices through a bucket of data, similar to how family plans works for voice minutes.

VerizonLogo1And Verizon’s plans were criticized as being pricey, especially at a time when smaller rivals Sprint and T-Mobile US are promoting unlimited data plans. However, that isn’t worrying McAdam, who says that his company isn’t competing on price. Rather, Verizon is differentiating itself on the network, offering consumers reliability and the largest 4G LTE footprint of any carrier in the U.S.

“We never have and never will lead on price,” he said. “We’ve got footprint we like. We’re going to press that advantage.”

As mobile Internet speeds increase across the board for many carriers, we’re beginning to see a fierce rivalry between the carriers. AT&T is quickly catching up to Verizon’s footprint, though the second largest carrier is still at least a year behind Verizon’s robust deployment of 4G LTE technology. In terms of reliability and customer service, AT&T may be late to the game and though its network was hammered with overwhelming demand for the iPhone when it was the exclusive carrier leading many to call out AT&T for dropped calls and slow speeds, the carrier is turning around claiming titles like fastest network, most reliable network, and best customer satisfaction through independent studies.

Sprint and T-Mobile, both of which have smaller footprints, are competing in the price war. T-Mobile was first out of the gate this year with its un-carrier initiative. T-Mobile claims that its new plans are far more affordable as it doesn’t have to subsidize smartphones. In exchange for not having to sign a two-year contract, T-Mobile isn’t offering any phone subsidies so you’ll have to pay full retail price, but you have cheaper service and the flexibility to jump ship at any time without penalties if you’re unhappy. You can pay full price for your phone up front or finance it with interest-free payments. Though T-Mobile was first with its Jump plans, Sprint’s aggressive pricing for its competing One Up service bundles unlimited everything for just $65 a month.

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At the premium end of the segment, you’re going to see AT&T and Verizon competing and on the price war, we’re going to see T-Mobile and Sprint battle each other.

Still, in the smartphone space, McAdam is hopeful that the ecosystem will grow beyond just Android and iPhone. He is optimistic that Microsoft’s acquisition of Nokia will give that company more strength and the deal that will have BlackBerry go private may help the company produce competitive products. Even within Android, there is still fierce competition between the various vendors.

  

Comments

  1. jorden says

    This is just another example of big companies screwing everyone. People are still streaming as much as before and the networks are still able to handle the load. The only exception now is we pay more money for the service. What, by charging us more money their servers can all of the sudden handle the loads. Give me a break; it’s a B.S. excuse for them to get more money out of us, that’s all.

    • Joshua says

      To be fair… How much do you think it costs to maintain the systems? Power them? Hell, how much do you think it costs to build the towers and increase signal strength and coverage the way that Verizon has done?

      It costs a lot. 4G LTE and 3G are not just magical pixie dust clouds that are found in the atmosphere. They were completely and entirely sustained by Verizon. And it costs them a lot more than you’d think. Most of their profits goes to employment and technological advancements. So what? You want to halt progress in the mobile industry completely just so you can get a few extra GBs of data?

      Eh. It’s whatever to me. I still have my Unlimited Data plan under Verizon and don’t plan on giving it up. But at the same time, I understand completely the financial circumstances that would lead them to eliminate unlimited data.

      • nathan says

        o please the profit margins alone from texting could cover most the data costs. and the profit margins these companies have shows that they can afford it but chose to ignore it for short term gains

  2. larry says

    ya right just a good example of corporate greed like apple inc. VZW can do it they would gain not loose at all!! there 4g lte is not all that like they claim thats why they dont offer than the system would FAIL!! god forbid that happen than VZW will loose there reputation for sure!!

  3. Akin67 says

    So Verizon’s excuse for no longer offering unlimited data is customers are using more. I can respect that. But why are they then not charging considerably less since customers are using far less voice and text messages? Basically in their plans they provide unlimited voice and text but provide “zero” data. In the past when you added a smart phone at $40/month to your plan you got either unlimited data or 2 GB of data. They now still charge $40 but give you absolutely NO data at all. I just moved my entire family and our 5 smart phones to T-Mobile and could not be happier. We have unlimited EVERYTHING for about half the price of what we would pay for a very limited data plan from Verizon.

  4. jason says

    T mobile is not unlimited my wife has it and when she hits 1Gb hit knocks her down to 3G and her speeds get really slow

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