Verizon Announces Phasing Out Of Unlimited Data Plans

The Chief Financial Officer of Verizon Wireless announced at a conference in Boston on Wednesday that customers who have subscribed to unlimited data plans will be forced to switch to tiered plans post upgrades.

Fran Shammo, the CFO of Verizon Wireless, spoke of the company’s plans to introduce a data share pricing model that will provide their customers with data packages they can use for multiple devices through the same account. This plan is expected to be introduced by mid-summer.

Alongside the introduction of this new plan, Verizon is looking at switching all their customers from unlimited data plans to tiered data sharing plans. Customers who have had unlimited data plans in the past will not be allowed to continue when they switch to a new data plan. This explains why Verizon had earlier barred new customers from buying unlimited data plans. However, the spokesperson for Verizon did not comment on the matter.

According to Shammo, Verizon is looking at changing their strategy to increase revenues through data, with the market being flooded with new consumers and a drop in usage of voice and text services. The average revenue earned per smartphone user has fallen by $10 in the last two years. On account of having difficulties in attracting new consumers to opt for their services, Verizon is now focusing on trying to increase the revenue they earn from existing customers.

Verizon’s lowest tier plan costs $30 a month, the same price one used to pay for the unlimited data plans. In Verizon’s defense, data usage is increasing with the growth of 4G networks. This will eventually push the customers to move to higher tiers, which are pricier as well. Verizon is of the opinion that this will help them earn more revenue in the future. Essentially, the more data you use, the more you are going to have to pay to Verizon. This is not it; Verizon has also recently imposed an upgrade fee of $30 on its customers. Shammo claims it has been a successful move.

On the other hand, AT&T Wireless, the first to introduce tiered data plans, still allows their customers to continue with unlimited data plans even when they upgrade. Sprint, however, is the only national carrier to allow new customers to opt for unlimited data plans.