Verizon confirms it will ditch unlimited smartphone data plans starting July 7
Verizon Wireless (NYSE:VZ) will switch to a new, usage-based pricing model for smartphone data starting July 7, a company spokeswoman confirmed.
Verizon spokeswoman Brenda Raney told FierceWireless that new smartphone customers will choose from one of three options: $30 for 2 GB, $50 for 5 GB or $80 for 10 GB. There will be an overage charge of $10 per GB of data. Verizon will also charge $10 for 75 MB per month for feature phone users. AT&T Mobility (NYSE:T) charges $15 per month for 200 MB and $25 per month for 2 GB.
Verizon confirmed last month it would make the switch, and reports and rumors have been circulating that the changes will take effect July 7, but Verizon had not confirmed the changes or the specifics of the plans--until today.
Existing customers who upgrade on or after July 7 will be able to upgrade to another smartphone and keep their unlimited smartphone data plan, Raney said.
Verizon also is making pricing changes to its LTE mobile hotspot service, available from smartphones like the HTC ThunderBolt and Samsung Droid Charge. Currently, the LTE mobile hotspot feature is free and unlimited. Raney said that for customers who have been using the LTE mobile hotspot service on their phones, starting July 7, they will be charged $30 per month for unlimited LTE mobile hotspot use. For new customers, the mobile hotspot service will cost $20 for an extra 2 GB of data to be used for mobile hotspot service or any other data service. The mobile hotspot changes were first reported by the Android blog Droid Life.
Verizon is the latest carrier to switch from unlimited smartphone data pricing to a metered approach. AT&T started the trend last year, and T-Mobile USA subsequently followed (though T-Mobile throttles users' speeds when users go over their allotted data buckets, rather than charging overage fees). Sprint Nextel (NYSE:S) remains the only Tier 1 carrier that has not committed to a usage-based smartphone data pricing scheme. Sprint CEO Dan Hesse has repeatedly said that customers value the simplicity of its plans, though he has also said Sprint might consider changing its plans at some point.
What's next for Verizon? Verizon Communications CFO Fran Shammo hinted in May that Verizon will move to shared data plans for multiple devices after it introduces the usage-based pricing, though he did not give a timetable for doing so.
- see this Droid Life post
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Correction, July 5, 2011: This article originally incorrectly stated that Verizon's $10 data plan for 75 MB was for smartphones. It is for feature phones, not smartphones.