Verizon ended a flurry of promotions yesterday, killing a buy-one, get-one-free deal on the Samsung Galaxy S7 and S7 Edge as well as its offer to pay up to $650 in early termination fees for users who switch carriers. Verizon's offer of half off a second Droid to users who buy two Droids through its equipment installment plan also expired.
The news was first reported by Wave7 Research and was confirmed by a Verizon spokesman.
"Verizon launched its $650 ETF buyout on December 28 and AT&T launched its $650 ETF buyout on February," Wave7 wrote in a note to subscribers. "T-Mobile and Sprint have had comparable $650 offers in the market for a long time. Verizon's GS7/Edge BOGO was slated to expire at the beginning of April, but was extended."
AT&T continues to offer its own $650 ETF buyout, as do T-Mobile and Sprint. That Verizon discontinued its $650 ETF is notable, considering it was a major promotion when it launched. Verizon ending the program could indicate it made progress against its rivals during the first quarter season -- and of course Verizon could well resurrect the offering in the future.
T-Mobile kicked off the ETF buyout trend by launching its $650 ETF buyout offer in January 2014, and the carrier has continued to offer it since.
As for the BOGO offers, Sprint continues to offer its similar BOGO deal on Samsung's new flagship phone to users who activate at least one new line and pay through a lease or installment plan, Wave7 continued, while AT&T's BOGO deal applies only to iPhones and requires a new line of service. "T-Mobile's lead offer currently is of an iPhone semi-BOGO (50 percent off second iPhone purchased, must add a line). Sprint's 50 percent off promo continues, although it was altered this week to require a device trade-in."
And Wave7 noted that the nation's largest carrier is now running a TV commercial featuring Ricky Gervais that plugs a new offer to pay as much as $300 to users who trade in their current smartphone and buy and activate a new line of service on Verizon.
"To be clear, Verizon is now offering 'up to $300,' not a minimum of $300, so in the view of Wave7 Research, Verizon is directionally offering customers credit for the market value of their device, which is not much of an incentive. In all, this is a significant reduction in Verizon's promotional intensity," the firm said.
Verizon's aggressive promotions were an effort to extend the holiday shopping season into a traditionally quiet first quarter. But analysts at Wells Fargo Securities earlier this week predicted Verizon would report 120,000 postpaid phone losses during the first quarter, leading to speculation that the carrier may soon ramp up its promotional efforts again.
"VZ often promotes more heavily beginning in Q2, so we would expect the Q1 postpaid phone losses to turn positive in Q2," the analysts wrote.
Meanwhile, Verizon launched a new promotion in support of Android Pay, Google's mobile wallet offering. Subscribers who use Android Pay once receive 1 GB of free data over the next two billing cycles, and when they use it a third time they receive another 1 GB of data.
Verizon no longer has a major stake in the mobile payments space following Google's acquisition of Softcard, a carrier-backed system that never gained any real traction. But Verizon is the only major U.S. carrier that doesn't allow Samsung to preload the manufacturer's mobile payments solution on its phones. The new promotion is the latest signal that Verizon has a clear interest in the success of Android Pay.
- see this Verizon web page
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