There was a limit, after all, to just how long Verizon could withstand the pressure of its rivals offering unlimited data plans. Starting today, it will, too.
Verizon eliminated unlimited data plans from its offerings in 2011. And just last month, Verizon CFO Matt Ellis said the company “didn't feel like it needed an unlimited plan to
compete with AT&T, T-Mobile and Sprint, but ‘we continually monitor
the market and we will see where we head in the future,’” ZDNet’s Larry Dignan reminds us.
It monitors the stock market, too, of course.
“Verizon shares have dropped about 2.3% over the past 12 months, compared with a 78% surge for T-Mobile and a more than threefold gain for Sprint Corp., which has also been
aggressively pushing unlimited plans,” Bloomberg’s Crayton Harrison observes.
“Verizon might not be facing an
immediate crisis, but it doesn't want to drive any more customers to a fast-growing rival,” writes Jon Fingas for
Engadget, pointing out that the company had disappointing subscriber growth in the fourth quarter.
“The new plan is a stark change in strategy for Verizon, which has spent years trying to get customers to pay for data based on usage and recently raised prices on certain
fees,” writes Ryan Knutson for the Wall Street
Journal.
Verizon, in fact, got itself embroiled in a seemingly unnecessary PR gaffe just a month ago when it told a small group of customers who were on
legacy unlimited data plans and habitually used more than 200 gigabytes a month to choose another plan or be disconnected.
The new Verizon Unlimited introductory plan —
which runs on the “best 4G LTE network in the country,” according to the release announcing
the change of heart — provides unlimited data on an individual’s smartphone and tablet as well as HD video streaming, Mobile Hotspot for 10 GB of 4G LTE data (3G speeds after that),
calling and texting to Mexico and Canada and up to 500 MB/day of 4G LTE roaming in Mexico and Canada.
“Verizon added that after 22 GB of data usage on any one line, the
company might ‘prioritize usage behind other customers in the event of network congestion.’ Verizon added that it would maintain its existing data plans for those who didn't want unlimited
data," writesCNBC’s Javier E. David.
“At $80 a
month for a single smartphone, Verizon’s new unlimited plan is only $10 more than a current Verizon plan that includes just 4 gigabytes of monthly data. By comparison, T-Mobile is selling
unlimited data for $70 for one line, including taxes and fees,” the WSJ’s Knutson reports in a story illustrated by a chart with all of the major competitors’ deals for single
and family unlimited date plans.
“Many analysts had predicted Verizon would not offer an unlimited plan because it has relatively less available spectrum per subscriber than
the smaller carriers. Customers on unlimited plans will likely use more data than when they were limited to just 5G or 10G per month, which would cause crowding on Verizon's network,” reports Aaron Pressman for Fortune. “But the carrier said it had added enough advanced equipment to handle
more traffic.”
The announcement “comes a few days after rival wireless carrier Sprint introduced a promotion for its own unlimited data offering. But
that plan has a catch: the promotional pricing ends after the first year,” reports Steven Musil for CNET.
“The cost of Verizon's plan will not go up after a year, a Verizon spokesman said.”
“Unlike our competitors, the price is the price,” the spokesman tells
Musil.
And the reality is the reality.
“The move by Verizon was ‘inevitable,’” said Roger Entner, a telecom analyst with Recon Analytics.
He had expected Verizon to begin offering unlimited wireless plans, but the company's announcement comes ‘a bit earlier than expected. But only by months, not by years. ... They are fighting
back hard,’” report Mike Snider and Eli Blumenthal for USA
Today.
Or, as Forbes contributor Mark Rogowsky puts it in his lede: “Poke the bear long enough, and the bear
will wake up.”