Verizon will kill ‘grandfathered’ unlimited data plans, push users to data share
Verizon Wireless (NYSE:VZ) plans to eliminate the $30 per month unlimited data plan that it still provides to 3G customers who were “grandfathered” into the plan because they were data customers prior …
Context & Ripple Effects
The move closes the loophole left open by Verizon's earlier decision, confirmed in July 2011, to stop offering unlimited smartphone data to new subscribers starting that July 7. Existing customers were allowed to keep their $30 unlimited plans when upgrading — the 'grandfathered' tier — and this announcement ends that carve-out for legacy 3G users, herding them into Verizon's newer data-share structure.
The pickup was unusually broad for a pricing change: Reuters, Ars Technica, Engadget, Computerworld and others all carried the story on or about May 16, with Reuters framing it around revenue — Verizon expects shared plans to lift average revenue per user versus flat-rate unlimited. That framing matters because it signals the shift is a monetization play timed to the LTE device cycle, not a network-capacity emergency.
First-order effects
- Grandfathered 3G customers on the $30 unlimited plan lose their flat-rate option at upgrade time and must choose among data-share buckets, directly raising Verizon's per-user data revenue on its most loyal base.
- Heavy data users face the sharpest change: under shared plans their effective cost scales with consumption, so the customers who made unlimited valuable become the ones paying the most.
Second-order effects
- Removing the unlimited backstop pushes subscribers toward 4G/LTE devices, since staying on a metered plan makes faster speeds more attractive — accelerating Verizon's LTE migration while capping its cost exposure per user.
- Rival carriers still marketing unlimited plans gain an immediate retention pitch against switchers fleeing Verizon's share plans, turning plan structure itself into a competitive weapon at upgrade time.
Third-order effects
- If the pattern holds, flat-rate mobile data becomes a legacy artifact across US carriers, with pricing power consolidated in shared-bucket architectures where the carrier sets the meter — a structural win for the access layer that regulators and consumer advocates may eventually have to weigh.
- The grandfathering playbook itself gets exposed: carriers learn that promises of 'unlimited forever' survive only until the next network transition (3G to LTE), which invites skepticism toward whatever terms accompany future technology shifts.
The trend: US carriers are systematically retiring all-you-can-eat data pricing at each network transition, replacing it with metered shared plans that convert heavy usage from a liability into revenue.