Verizon Wireless (NYSE: VZ) is bringing back lower promotional pricing for its More Everything shared data plans. The carrier is offering a 10 GB plan for $80 per month, down from $100, and it re-introduced a 15 GB plan for $100 per month.
The plans do not include the price of monthly access charges for connecting smartphones, tablets and other devices.
"We have different offers throughout the year, and right now the $80/$100 plans are available," as is noted on the company's website, Verizon spokeswoman Debi Lewis confirmed to FierceWireless. She said the plans will be available for a limited time and there is no defined end date for their availability.
Verizon first introduced the promotional pricing in November 2014, amid the holiday shopping season and shortly after the iPhone 6 and 6 Plus were introduced. Then in February, Verizon cut prices on most options for its More Everything plans, including many by $10 per month.
Speaking on the company's first-quarter earnings conference call earlier this week, Verizon Communications CFO Fran Shammo said that the company would watch the competition closely and respond when necessary, but would not get drawn into a price war for price-sensitive customers. "We have to be rational and we will not chase every customer," he said, according to a transcript provided by Verizon. "But we are making every effort to maintain our base and keep our customers and upgrade them into a price plan that's fitting for them. We made improvement in that, but I will tell you we still have some more improvement to do."
Shammo also noted that traditionally the first quarter has less promotional activity but hinted that Verizon would ramp up its promotions in the second quarter. "As you go into the second quarter and you enter into Mother's Day and Father's Day, I would expect that the promotional activity and competitiveness is going to heat up here," he said. "So that will offset some of the benefits [to margins] that you are going to see. Look, I think that service revenue and ARPA will continue to decline as the Edge rate takes up, but it's really about overall revenue growth and the profitability of the business."
Jefferies analysts Mike McCormack, Scott Goldman and Tudor Mustata wrote in a research note that they think Verizon's recent pricing changes could further pressure its average revenue per account, or ARPA. "We are a bit surprised by the move as 2Q is a seasonally mediocre quarter, and wonder if the move is in response to competitive activity," they wrote. They noted that along with the refreshed plans, Verizon is continuing to run a promotion offering two lines with 6 GB for $100 per month, as well as a $100 bill credit switching offer.
"The change is likely to modestly pressure ARPA trends, a continuing concern of ours industry-wide," the analysts wrote. "Given rapidly increasing adoption of 'More Everything' plans with Edge already impacting ARPA projections, we are surprised by the move to re-up the promotions."
The analysts added that Verizon's latest price changes could signal success for T-Mobile US's (NYSE:TMUS) popular four lines for $100 per month 10 GB promotion. They expect AT&T Mobility (NYSE: T) to remain focused on ARPU and margins over subscriber gains.
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