Verizon's tiered data plans hitting October 28, smartphones still getting unlimited option?
We'd told you back in July that Verizon would migrate away from unlimited data and toward a tiered model very quickly; turns out it wasn't quite as quickly as we'd thought, but as Ivan Seidenberg said last month, it's still going down.
Context & Ripple Effects
Verizon's pricing shift had been signaled since June, when coverage raised the prospect of following AT&T toward tiered service, and a July report pointed to AT&T-style limits arriving later that month. A September report that Verizon was readying tiered data pricing made the change a sustained policy direction rather than a one-off trial.
The October 28 timetable matters because it turns that direction into a customer-facing plan change, while the question over an unlimited smartphone option leaves the scope of the transition central to how subscribers assess it.
First-order effects
- Verizon subscribers selecting service after the rollout face tiered data choices in place of the existing unlimited offering described in the report.
- Verizon moves mobile-data pricing toward charging by usage tier, giving it a direct mechanism to distinguish lighter and heavier data consumption.
Second-order effects
- The move brings Verizon closer to the AT&T-style limited-plan model identified in earlier coverage, making usage allowances a more direct point of comparison between the two carriers.
- Customers whose usage exceeds lower tiers will have a stronger incentive to monitor consumption or choose higher-priced plans, shifting plan selection from a flat-rate decision to a usage decision.
Third-order effects
- If major carriers retain tiered structures, mobile broadband competition shifts from headline unlimited offers toward the size and price of usage allowances.
- The unresolved treatment of smartphones shows that the long-term model depends on whether carriers can apply usage-based pricing to their most data-intensive device category without weakening plan adoption.
The trend: U.S. wireless carriers are moving from flat-rate mobile data toward usage-tiered pricing that ties subscriber revenue more closely to consumption.