U.S. Cellular intends to launch more tiered pricing options for smartphone data in the first half of the year, according to TDS CEO Ted Carlson. TDS is the parent company of U.S. Cellular.
Carlson did not specify when the carrier would introduce the pricing or what kind of pricing options would be available. However, he did indicate that U.S. Cellular would introduce smartphone data price points below its current 5 GB/$30 per month tier. The company also offers 100 MB for $10 per month, but Carlson said that there would be more tiers beneath the highest tier. U.S. Cellular first indicated last August that it would move to tiered pricing within the following two or three quarters, but did not provide specifics beyond that.
"We're always looking at our plans to make sure our customers have the right options to meet their needs," U.S. Cellular spokesman Steve Carlson told FierceWireless after Ted Carlson's appearance.
Speaking at the Stifel Nicolaus Technology & Telecom Conference on Tuesday, Carlson said that such plans would be the "carrot" to get customers to sign up for smartphone data plans. Once signed up, he said, customers will experience the benefits of mobile data and then the carrier will hopefully be able to move customers up the data usage curve to increase ARPU. Many carriers, led by AT&T Mobility (NYSE:T), have employed similar strategies to get customers to switch to smartphones.
Interestingly, Carlson was also asked about how the carrier is handling its heaviest users. The executive noted that at the end of third quarter U.S. Cellular only had around 26 percent smartphone penetration so it is not being pinched by heavy data users as much as larger carriers. However, he said that U.S. Cellular is considering whether to throttle the 1 percent to 3 percent of users who exceed 5 GB of data per month. He also said the company might consider charging overage fees, but noted that no decisions have been made. Currently, for customers who go over the 5 GB monthly data limit, the carrier charges 25 cents per MB with a cap of $200.
Carlson noted that to institute such policies the company needed to invest in new equipment. Carlson noted in December that U.S. Cellular is working with BSS/OSS vendor Amdocs on updating the carrier's billing systems, a project he said will not be complete until the middle of 2013.
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