Verizon Justifies New Pricing
CNET talks to Verizon Wireless CTO David Small about the company's shiny new LTE network, spectrum needs, and Verizon's recent decision to replace unlimited data plans with 2GB ($30), 5GB ($50) and 10 GB ($80) plans. Verizon has less spectrum than AT&T (who has insisted the T-Mobile merger is necessary to obtain spectrum), yet again states they're in good shape with spectrum -- as they can slowly re-purpose existing spectrum for LTE. As Verizon has done in the past, Small argues that the higher prices are essentially because Verizon operates a "premium" network:
CNET:Earlier this month, Verizon changed its pricing to a "usage-based model." Now instead of unlimited data, you offer several tiers of service starting at 2GB for $30 a month. AT&T offers something similar, but its lowest tier is 200MB for $15. Verizon is clearly more expensive. Would you say that Verizon is the premium provider in the market, and therefore can charge more than its competitors for service?
Small: We have a premium network. There is no question about it. We are a leader in the market. JD Power, Consumer Reports, and others have all given us high marks for our superior network. And we believe customers see value in the reliability and performance of our network.
Verizon Wireless CTO talks 4G, data consumption (Q&A) | Signal Strength - CNET News
Small's not wrong about Verizon doing better in customer satisfaction studies than their competitors, and the company has been aggressive in ensuring their LTE network gets built out. Still, initial reaction to the price changes have not been positive, and it doesn't matter how cutting edge your network is if many consumers can't afford to seriously use it.
CNET plays lapdog and answers the question within the question
rather than put Verizon on the spot and ask them straight out.
Verizon is not charging based upon its "premium" service.
It is dropping unlimited to rip off users plain and simple.
- 07-14-2011, 05:46 PM #2
No company ever has a positive reaction to price change if it is not in favor of the consumer, no matter what industry, this is fact. Now as to Premium network they are not lying. How many people got a iPhone and could not use it on AT&T, their network is not as reliable. So if you want premium and reliable you pay a bit more, just as any other industry. If you can not afford it (Verizon) there is nothing wrong with that, not everyone can afford steak all the time, but for those who can, enjoy the feast.
Last edited by JimiMack; 07-14-2011 at 06:14 PM.
- 07-16-2011, 10:44 PM #3
I agree that the price change is a bit unreasonable and I was using an older phone that didn't require me to use 3G because it was old enough and I could put a 3G block on it and save $30, but once I heard about this I went back to my Droid and even though I spend more, I have peace of mind. I wish it wasn't so bad. T-Mobile's plans aren't bad at all.
- 07-17-2011, 11:47 AM #4
With more and more smart phones being sold every day carriers need to come up with revenue to keep the ball rolling. I know in the building I run we have two towers one with Att and one with Metro PC's and they both pay over $100,000 to have their towers there. So keeping up with the network can get costly!
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- 07-21-2011, 06:49 PM #8
AT&T has the cheaper plans, which would help out more people. Verizon basically cut out the unlimited plan, and for more money, you can now have a limited plan. They shoul have offered a lower plan (maybe 15 or 20 a month), and had the gb's of data a little bit more for each tier
- 07-22-2011, 08:38 AM #10
Verizon can justify all they want it still comes out as bend over and take it if you want to use our network and we'll screw you more and make you like it.Sent from me using my fingers. Be pantless in 5K. Febreze - for more than smells.
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- 07-22-2011, 08:46 AM #118130 -> 8330 -> 9530 -> 9550 -> 9630 -> 9650 -> 9930 -> iPhone4
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- 07-22-2011, 09:01 AM #12Sent from me using my fingers. Be pantless in 5K. Febreze - for more than smells.
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- 07-23-2011, 04:46 AM #13
Honestly I hate the new pricing... Its too high. But good thing I'm locked into my unlimited
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- 07-23-2011, 06:45 PM #14
Make a lower priced "light user" tier and everyone is happy. When you tell people "you use only 1g of data, so you fit the 2g plan" they wonder why someone else who got their plan in june gets unlimited for the SAME pRICE.
My brother and wife both have thunderbolts, his upgrade date was a month after hers (his was july 7th) so she has unlimited, and he pays the same and is capped at 2gigs. That just stinks of total rip off. He would have been perfectly ok with paying a little bit less just for piece of mind if he knew he only used 2g and had been paying for unlimited when he really didn't need it.
Justify it all you want, admit making the lowest data plan possible cost the same as unlimited did since forever will get some people upset.
Long winded post sorry. This just irritates me because the solution was so obvious.
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