Verizon Introduces New Monthly Service Plans, Eliminating Smartphone Subsidies for New Customers

[garya73]

Bottom line is all big four carriers are essentially forcing people off cheap flip phones whether they like it or not. Because there is no longer and cost savings having a flip phone with no data.

There is still a large segment of the population that doesn't care for smartphones. Unfortunately unless u have grandfathered old plans. No longer possible to add $9.99 add a line flip lines for grandpa and grandma.

There are plenty of other options out there for those who want to just talk. Plenty of prepaid phones and MVNOs like Cricket who offer talk-only plans. The future of phones is not in talk-only flip phones, so it makes sense for the carriers to abandon them. Just like antenna tv when cable and satellite came, rotary phones when touch tone phones came, radio (as the primary source of entertainment in the home) when tv came, cassettes for cds, dvd (and now blu ray) for vhs, and so on. But the adoption rate for new technology is increasing at a faster rate then it had in the past.

Flip phone users are a small minority of overall phone users. Most people have smartphones these days, and I suspect that in a generation or two you won't see a talk-only phone in the stores and you won't be able to get a plan for one.

Notice how pretty much all the plans now include unlimited talk and text? Data is where the money is.

 

[C DM]

Bottom line is all big four carriers are essentially forcing people off cheap flip phones whether they like it or not. Because there is no longer and cost savings having a flip phone with no data.

There is still a large segment of the population that doesn't care for smartphones. Unfortunately unless u have grandfathered old plans. No longer possible to add $9.99 add a line flip lines for grandpa and grandma.

Well, we don't quite know what the pricing would be for a regular basic feature phone, it might be the same $10/month essentially. Odd that it wasn't mentioned in relation to the new plans so far.

 

[C DM]

Sounds fishy, Verizon doesn't do anything unless it makes them money.

What company does? I guess every company is "fishy" then.

 

[skinned66]

So...my 6GB data plan for $35 CAD is looking pretty sweet.

But hey, I'm special.

 

[skinned66]

If all carriers move to this, how much will this impact the new iPhone sales? I don't see the exact same number of people shelling out hundreds of dollars for the new new device. Something has to give.

This certainly makes sense to me. That said, my crystal ball tells me it won't be Apple that will be doing the giving. Imagine how much more second hand market would get a bump if all the carriers jumped on this bandwagon.

I don't see everyone moving this way yet. If it's enough to make people switch carriers - and I believe it is - Verizon will bring subsidies back. They just have to bleed for a bit.

 

[campyguy]

There are plenty of other options out there for those who want to just talk. Plenty of prepaid phones and MVNOs like Cricket who offer talk-only plans.

Agreed with your other points and I get what you mean, just FYI Cricket isn't one of the "talk only" options. Their $25 plan is for UL talk/text, we have a few of their plans for when we're out of VZW/USCC range and we need to confer with others. Cricket's other plan options - at least the ones I can buy "today" include data on top of talk/text.

 

[campyguy]

So...my 6GB data plan for $35 CAD is looking pretty sweet.

But hey, I'm special.

IMHO my 4 lines of UL data on VZW's network at US$30 each are sweeter and specialer.

 

[31 Flavas]

If all carriers move to this, how much will this impact the new iPhone sales? I don't see the exact same number of people shelling out hundreds of dollars for the new new device. Something has to give.

Honestly, I don't think the outrage will be at Apple -- rather at the carriers for deceiving their customers for so long. I mean, when you bought your iPhone or Android or Windows phone, or whatever, you thought you were saving $450, you were told you were saving $450, and until recently -- there wasn't a two tier pricing structure for service. Everyone just paid the same price; So you couldn't figure it out. But, I suppose it is equally as likely that customers might still remain ignorant and, instead, just think the carrier is screwing them over.

But, that said, unless I am mistaken, I don't think I have seen that full price financing, be it AT&T Next, VZW Edge, or whatever has slowed sales down. I gather that is probably because all the customer sees is that they are getting lower service prices as a result. Sure they're paying "more" for their phone. But paying also paying less for cellular service. So it's likely an even trade to them.

Which, to me, seems just about right. Because nothing is really actually changing. You've always been paying full price for your phones (be they iPhones or not). Unless, there was a literal sale being offered though Best Buy, some MVNO, or the carrier for whatever reason.

This certainly makes sense to me. That said, my crystal ball tells me it won't be Apple that will be doing the giving. Imagine how much more second hand market would get a bump if all the carriers jumped on this bandwagon.

It will, at least, very likely increase the used sale price. Since individuals won't be under a mistaken assumption that $200 is all they need to sell their previous gen iPhone (or android) for to get a "free" upgrade.

I don't see everyone moving this way yet. If it's enough to make people switch carriers - and I believe it is - Verizon will bring subsidies back. They just have to bleed for a bit.

Eh... subsidies are dead, IMO. I'd say on the balance, customers don't want to be locked in carrier service contracts. Now, true, trading the carrier service contract for a financing contract on a phone still means your "locked in a contract". But, IMO, it's much less of an obstacle. Because either the carrier you are going to (right now, only T-Mo) will buy out and pay for your phone contract (because the phone is resellable) or you can pay the remainder of your balance and just have the phone unlocked for use on the new carrier. Or worse case, if the phone is incompatible, you just sell the phone to reclaim some cost.

You couldn't reclaim any of the ETF cost to cancel a carrier service contract. Unless you were moving to T-Mobile.

 

[unplugme71]

Sorry, but I don't want to order my cell service in S, M, L, XL. How about I order my cell service by who doesn't **** me the most over?

I like split plans. It makes sense to know that you aren't paying subsidized costs after 2 years. It also lets you shop better. But why are the prices continuing to increase? It's getting the point where I rather be it subsidized as I'll end up paying less.

Now they want to tack on HUGE upgrade/new service fees. I compared my bill from 2007-2010 to what I pay in 2014-2015 and wow, the prices really went up. Even adjusting 4% for inflation.

 

[31 Flavas]

Now they want to tack on HUGE upgrade/new service fees. I compared my bill from 2007-2010 to what I pay in 2014-2015 and wow, the prices really went up. Even adjusting 4% for inflation.

Yea, I don't think AT&T and VZW customers will forever tolerate increased costs. And if this is just a ruse by VZW to increase prices more they'll drive more customers away. Especially when T-Mobile just keeps improving their network. Hopefully Sprint will pick up the pace here a bit, too. MVNOs and Google-Fi will continue to attract customers, as well. Deprioritized service isn't huge deal for most customers and saves money.

 

[Bawstun]

But the courts basically allow Verizon to run a monopoly on the bandwidth. Didn't I just read they rejected some opposition by T-Mobile in that regard? Verizon owns so much of the LTE bandwidth that theyll basically never throttle their network with too many users. Sprint and T-Mobile continue to have this problem but they're kind of unable to solve it.

 

[31 Flavas]

But the courts basically allow Verizon to run a monopoly on the bandwidth. Didn't I just read they rejected some opposition by T-Mobile in that regard? Verizon owns so much of the LTE bandwidth that theyll basically never throttle their network with too many users. Sprint and T-Mobile continue to have this problem but they're kind of unable to solve it.

What I have read is that the FCC is aware and they going to be watching the auction to prevent AT&T and VZW from gaming the system. Although, i'm not sure what that means. But the FCC also has excluded AT&T and VZW from and reserved close to 40% of the spectrum in the auction only for T-Mo, Sprint, others. So AT&T and VZW can't just buy everything, even if they wanted. What T-Mo asked for was a larger part of the auction to be reserved and excluded from AT&T and VZW, but that request was denied.
Source: John Legere on twitter.

Second, according to this post on the T-Mo sub-reddit, AT&T and VZW might not be doing much bidding anyway. They spent a lot of money in the last auction and AT&T spent a lot of money on DirectTV. So outside of specific areas there might not be much they bid on. Thats all speculation, but I suppose that poster wouldn't be posting that without good reason.

 

[randian]

From what I've read, the main differences between Cricket and AT&T are no tethering, no AT&T roaming service (https://www.cricketwireless.com/map.html), and LTE/4G speeds top out at 8/4mbps.

It's not just bandwidth. Cricket data goes through a proxy, adding tons of latency. You might be 35ms native but 100+ms latency through Cricket. Everything takes very noticeable extra time to start up/load.

 

[paysdoufs]

I'm not defending Verizon, but I hate when people say "My <insert European country> offers x for y". People get it, your wireless service is cheap. Look at the size of your country though and consider that as one factor. Look at the size of the Verizon or AT&T network. Apples to oranges.

Population density USA: 35 souls / km2
Population density Sweden (since the example came up): 22 souls / km2

I think that's pretty much an apples-to-apples comparison. But you probably believe that your mobile data is of better quality

Alors tais-toi et paie, ami américain...

 

[paysdoufs]

Never thought I'd defend the US Telcos, but they do have to spend a lot more on infrastructure to build out networks. No offense to our friends in the UK and Europe, but there are whole countries that aren't as big as some of our states. And out west it gets even more ridiculous, because they have to build their networks to cover vast, sparsely populated areas, and deal with some massive mountain ranges.

For instance, in my home state of Colorado, the 8th largest state in the US, our land mass is more than twice that of England, with a ton of wilderness area and the Rocky Mountains running north-south throughout the state. Texas is over 5 times as big as England.

And yet - you realize that even with these sky high prices you'll NEVER have every single mountain bowl or remote ridge covered, do you? So it remains a rip-off.

PS: Geographically, the UK is in Europe. Politically, it's even part of the EU. Just saying...

 

[zorinlynx]

I'm not defending Verizon, but I hate when people say "My <insert European country> offers x for y". People get it, your wireless service is cheap. Look at the size of your country though and consider that as one factor. Look at the size of the Verizon or AT&T network. Apples to oranges.

This argument doesn't really work, because while the US is physically much larger than those European countries, we also have a far larger population.

 

[C DM]

Population density USA: 35 souls / km2
Population density Sweden (since the example came up): 22 souls/km2

I think that's pretty much an apples-to-apples comparison. But you probably believe that your mobile data is of better quality

Alors tais-toi et paie, ami américain...

And yet the countries are completely separate and are even on different continents. To somehow draw apples to apples comparisons of things is just not realistic, despite the implications that it's somehow magically otherwise.

 

[rdlink]

Population density USA: 35 souls / km2
Population density Sweden (since the example came up): 22 souls / km2

I think that's pretty much an apples-to-apples comparison. But you probably believe that your mobile data is of better quality

Alors tais-toi et paie, ami américain...

Population density in the EU: 112 vs. 35 in US. Landmass of the US: 3.8m sq miles. Landmass of the EU: 1.7M sq miles.

 

[tunerX]

Verizon now
Monthly - 15GB shared for 100
Line charge for 3 phones - 45
145 total...

Verizon on the 13th
Monthly - 12gb shared for 100
Line charge for 3 phones - 60
3GB overage gap to get to 15GB - 45
185 total...

40 bucks of swindling for the same amount of lines and data.

 

[C DM]

Verizon now
Monthly - 15GB shared for 100
Line charge for 3 phones - 45
145 total...

Verizon on the 13th
Monthly - 12gb shared for 100
Line charge for 3 phones - 60
3GB overage gap to get to 15GB - 45
185 total...

40 bucks of swindling for the same amount of lines and data.

Wouldn't the new plan have 12 GB for $80 (instead of $100)?

They aren't listing more details in the initial press release, but it seems that there's good likelihood there will be options with more than 12 GB of data too.

Are you usually over 12 GB (and right around 15)?

 

[sjc83]

Wouldn't the new plan have 12 GB for $80 (instead of $100)?

They aren't listing more details in the initial press release, but it seems that there's good likelihood there will be options with more than 12 GB of data too.

Are you usually over 12 GB (and right around 15)?

 

[HalfNelson]

I love comments like this without any facts. Explain how a $399 iPhone at 2 year pricing is more expensive than a $850 iPhone on Next or any of those monthly plans. Every two years I get a new iPhones, sell my old one for 75-100% of my upgrade depending on condition and new model cost, effectively getting it for free or close to it, only paying my monthly charges which by what I have seen are within $10 of what I would pay monthly for service on their "new" plans before I add in the $27.50-$42.50 per month phone cost.

To many people, that look at the NEXT/EDGE plans, get stuck on looking at the cost of the phone, when they should be looking at how much money they get from the carrier, in the form of discounts. When you pay $399 for the phone(and lock into a 2-year contract), you are receiving a one time $450 discount from the carrier, over the next 2yrs.

With the NEXT/EDGE plans, instead of the one time $450 in discounts, you receive $15/$25* in discounts every month, even beyond the 2 years. $25 x 24 months = $600 in savings vs the $450 in savings that the subsidized route saved you. Also, each month you go beyond the 24, without replacing your phone, you're saving that $25 still.

Now,if you're only at $15/month savings, it's not as good over 24 months, as the subsidized option ($15 x 24 months = $360), but that changes if you keep your phone for at least 30 months. Plus, those NEXT/EDGE plans have the benefit of $0 upfront cost (you only pay for tax on the phone, at time of purchase).

The only people who still benefit from subsidized plans, are those who are hanging on to grandfathered plans that are not eligible for the $15/$25 per month savings.


*amount depends on how much data you share. You save $25/month, with AT&T sharing 10GB+ , and with VZW sharing 6GB+. You only save $15/mth when you share less than those amounts with each carrier.

 

[HalfNelson]

I sold my iPhone 5 this morning anticipating purchasing a subsidized 64gb iPhone 6 at BB for $199 and switching to their 1gb single line for $60/month. Assuming that's still available for the next week, how is it not significantly cheaper than the comparable new plan?

Contract plan: $200 + $60(24) = $1640
vs.
New plan: $30 (1gb) + $20 (line access) + $31.25 ($750/24) = $81.25(24) = $1950

Even if the iPhone 6 wasn't on sale at BB, the contract plan would still be over $200 cheaper. Am I missing something here?

Leave the phone out of the equation. Compare the price difference between the plans by themselves. Then, look at the difference in price of the phone by itself. Typically it is $450. $450 /24mnths = $18.75. If you are not saving more than $18.75 per month, when comparing just the service plans, then the new plans are not better.

 

[C DM]

To many people, that look at the NEXT/EDGE plans, get stuck on looking at the cost of the phone, when they should be looking at how much money they get from the carrier, in the form of discounts. When you pay $399 for the phone(and lock into a 2-year contract), you are receiving a one time $450 discount from the carrier, over the next 2yrs.

With the NEXT/EDGE plans, instead of the one time $450 in discounts, you receive $15/$25* in discounts every month, even beyond the 2 years. $25 x 24 months = $600 in savings vs the $450 in savings that the subsidized route saved you. Also, each month you go beyond the 24, without replacing your phone, you're saving that $25 still.

Now,if you're only at $15/month savings, it's not as good over 24 months, as the subsidized option ($15 x 24 months = $360), but that changes if you keep your phone for at least 30 months. Plus, those NEXT/EDGE plans have the benefit of $0 upfront cost (you only pay for tax on the phone, at time of purchase).

The only people who still benefit from subsidized plans, are those who are hanging on to grandfathered plans that are not eligible for the $15/$25 per month savings.


*amount depends on how much data you share. You save $25/month, with AT&T sharing 10GB+ , and with VZW sharing 6GB+. You only save $15/mth when you share less than those amounts with each carrier.

Well, looks like now it will be a flat $20/month discount basically, which is better for those currently on lower data plans, but not as much for those on higher data plans.

 

[rdlink]

Um. Yeah. I worked there. Are you referring to Jackson Hole or where people actually live and work? Wind is not topography. Neither is flat land.

Please cite these numbers.

Why on earth would I spend my time digging up my sources again to provide to you when you didn't do the same? You can find them just as easily as I did, if you're interested in knowing the truth.

Look, it's obvious that you and I don't agree on this issue, and that's fine. It's also obvious to me that I am right. If you feel the same that's your prerogative. But there's no need in our going back and forth about it anymore.

And do yourself a favor. Perform a web search on Wyoming topography, and take a look. It's not flat. It's not Colorado or Nepal, but it's not flat, either.