Less than a month ago, Verizon Wireless indicated that it would adopt a data plan that would allow its users to share data among a number of different devices, instead of having to have a separate data plan for each device. Today the company, a joint venture between Verizon Communications Inc. (NYSE: VZ) and Vodafone Group plc (NASDAQ: VOD), announced what it calls its “Share Everything” plans, a complicated set of “one-from-column-A” and “two-from-column-B” choices that look to be very good for the company but not so attractive for many users.
Competitor AT&T Inc. (NYSE: T) is expected to launch something like the Verizon plans, while Sprint Nextel Corp. (NYSE: S) is likely to stick with its unlimited data plans at least for the time being. T-Mobile USA, the US wireless carrier owned by Deutsche Telekom AG (OTC: DTEGY), offers an unlimited data plan but throttles users who surpass a pre-set limit. Pre-paid carriers MetroPCS Communications Inc. (NYSE: PCS) and Leap Wireless International Inc. (NASDAQ: LEAP) are more vulnerable to Verizon’s new plans.
In general, the plans offer unlimited voice and text messaging along with a data plan. Each device costs a basic monthly connection fee, but all devices can share the same data plan. (Here’s a link to Verizon’s calculator.) For customers who don’t use all their voice minutes and text allowance, the plans cost somewhat more. For heavy data users, the costs will almost certainly rise because the intention of Verizon’s plan is to migrate all its subscribers to its 4G network using 4G devices that consume gobs of data. Heavy voice users get a bit of a break, provided they don’t also use a lot of data.
Essentially, the shared plans make voice calling and text messaging free and charge heavily for data. Verizon is expecting data usage to soar and the company is putting its money behind that bet. An added benefit, from Verizon’s and other carriers’ point of view, is that voice-over-IP users are now brought back into the tent,too. As time goes on and unlimited data plans disappear, the shared data plans will boost revenue for the carriers — and probably by quite a bit.
Paul Ausick
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