Verizon Wireless (NYSE:VZ) reduced the price of its More Everything plans at 10 GB per month or more for customers on its handset upgrade program. The carrier said that, for customers on its Edge upgrade program, it will now cut $25 off the cost of a line of service to a smartphone if customers choose a data bucket of 10 GB or more. The result exactly matches the pricing AT&T Mobility (NYSE:T) launched in February--four smartphones sharing 10 GB of data for $160. AT&T has been heavily advertising the plan since it launched in February, and Verizon is likely moving to stymie AT&T's momentum with the offering.
A Verizon spokesperson explained that Verizon previously charged $20 per month per smartphone line for customers who chose 10 GB buckets or more and who subscribed to its Edge upgrade program. Now, Verizon is charging $15 per month per smartphone line. The carrier said it is not changing the pricing--$30 per line--on plans below 8 GB. The carrier also said that pricing remains the same--$40 per month per line--on plans that include a smartphone subsidy.
The result is that Verizon can now match AT&T's offer of 4 smartphone lines with 10 GB shared for $160; Verizon previously charged $180 for that bundle.
The tweaks come a few months after Verizon launched its More Everything pricing plans, which replaced the carrier's Share Everything plans. Verizon's More Everything plans increased the data allotments for some plans and also reduced pricing for customers on Verizon's Edge handset upgrade program.
Unlike plans from other carriers, Verizon still does not give customers a discount on service pricing if they buy their phone outright or bring their own phone.
"With the price change, Verizon now matches AT&T's pricing for the high-end plans, though still remains at a premium for lower data allotment plans" noted analysts from Jefferies in a research note about Verizon's new pricing. "Given the higher profitability of these customers, and the likely higher secondary device attachment rate, we do not view the move as a surprise. Since Verizon only recently launched EDGE EIP service plan discounts, we view the impact to the existing customer base as minimal and the discount could spur more adoption of higher allotment plans."
Verizon's pricing changes are just the latest in a long line of pricing tweaks that carriers have enacted since T-Mobile US (NYSE:TMUS) last year overhauled its pricing options to separate the cost of its handsets and its service plans. That action has dramatically increased the number of customers signing up for T-Mobile service during the past few quarters.
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Article updated April 3 with analyst commentary.