Unlimited data is back at Verizon. There's much merriment to be had throughout the land, as data-hungry power users once again return to their streaming music and video services without fear of sudden charges or slowdowns. It's been over five years since Verizon cut off access to unlimited data, and the number of customers hanging on to their grandfathered unlimited plans has dwindled down to a few grizzled veterans. It's a good day for wireless customers.
But don't assume that Verizon is offering unlimited data because it wants to, or because (as the announcement video suggests) its network is suddenly capable of handling all that extra data load. Verizon's new plans are simply a product of market forces: T-Mobile has been gaining customers by the millions, many of whom appreciate its unlimited data option, and Sprint has offered unlimited data on its smaller network at competitive prices, along with various budget carriers and MVNOs. Even AT&T has unlimited plans, but because they're trying to build a cute little communications monopoly, you have to buy DirecTV satellite service, too. Verizon found itself at a competitive disadvantage, and has finally corrected itself.
And Jesus, was it a long time coming. In the years since Verizon dropped its original unlimited 3G and LTE plans, it has done everything in its power to convince people that they don't really want unlimited data at all. As recently as last week Verizon was still running nationwide commercials arguing that unlimited data plans were a waste of money.
Let's take a look at the history of Verizon telling its customers that unlimited data is for losers.
July, 2011: Verizon stops offering unlimited data plans, forcing new customers to pick between much more expensive tiered options for limited data. The old $30 unlimited plan is replaced with a 2GB plan for the same price. Existing "grandfathered" customers are not forced to break their contracts to buy new subsidized phones and "re-up" their existing plans.
May, 2012: Verizon ends the grandfathered plan option for customers buying new, subsidized phones. Existing unlimited customers are encouraged to switch to a tiered plan to buy discounted phones. Many grandfathered unlimited customers either hold on to their old phones or buy new Verizon phones without a new contract, at a premium of several hundred dollars.
August, 2013: Verizon offers grandfathered unlimited data users an exclusive deal: 6GB of data for $30 a month on the new Verizon Edge plans. For those of you counting, that's $30 for 6GB on one hand, or $30 for unlimited on the other.
July, 2014: Verizon says it will begin to use network optimization (read: data speed throttling) on grandfathered unlimited users on LTE, in addition to the more congested 3G network. Before the threatened October implementation, Verizon walked back its threats, stating that an "ongoing dialogue" had made them reverse the decision. That dialogue presumably included a strongly-worded letter from then-FCC chairman Tom Wheeler.
April, 2015: A study performed by J. Gold Associates states that most customers don't use enough data to warrant an unlimited plan anyway. The results from the study were presented as a blog post on Verizon's press news page, along with the addendum, "The thoughts, opinions and suggestions of the author may not necessarily reflect those of Verizon Wireless." Apparently this data is no longer relevant.
September, 2015: Verizon CFO Fran Shammo tells investors that "at the end of the day, people don't need unlimited plans." He went on to bemoan the cost of unlimited data in the face of new streaming services: "You cannot make money on an unlimited video world."
November, 2015: Verizon adds a $20 surcharge to the original unlimited data plan, bringing the total data cost to $50. Most grandfathered customers are paying more than that, since the now-standard unlimited talk and text isn't included - they need to pay $40 or more on top of that to add minutes and text.
July, 2016: Verizon threatens to disconnect grandfathered unlimited data "abusers" who use more than 100GB of data a month. The lack of any limits on the unlimited data plans, including any mention of "abuse" of excessive data at any point, is no obstacle to the new policy.
October, 2016: Verizon introduces technically unlimited data via "PopData," $2 and $3 passes that will remove customer data limits for 30 minutes to an hour. The scheme is, to put it simply, bullshit... especially since a true unlimited plan was probably at the planning stages at this point.
And it doesn't end there. Ever since T-Mobile and Sprint started offering unlimited data plans, Verizon's marketing department has been doing everything in its power to try and convince customers that they don't actually want unlimited data at all. The relevant advertisements seem to have disappeared from Verizon's official YouTube account, but they're still pretty easy to find, like this one with Jaime Foxx.
The word "hypocrisy" springs to mind. As happy as we (and no doubt potential Verizon customers) are to see unlimited data return as an option, even if it has most of the same limitations as every other carrier's "unlimited" service, it's hard to ignore several years worth of stubborn denial from the company.
So why the change? Given Verizon's outright vitriol against unlimited data for the last several years, it seems like a major shift was needed to finally bring the company in line with other US carriers. Verizon's subscriber growth isn't noticeably slowing, nor is its churn rate increasing dramatically. The clue to the company's more open policy towards unlimited data might be in the original video, where Verizon Wireless executive vice president Ronan Dunne fills us in on the details.
Dunne is a new face at Verizon: he was hired on to his current role only in September of last year, leaving a 15-year job at Telefonica UK, working at various executive-level positions for Telefonica, O2, and Tesco Mobile. The Irish-born businessman is credited with growing customer bases by millions of subscribers.
While he reports to the parent company Verizon Communications, Dunne is now in charge of all aspects of Verizon Wireless, from network operations to customer retention to marketing. One can assume that he's hoping to make some very visible changes, resulting in noticeable profitability gains, in his first few quarters. The radical change to Verizon's years-long vendetta against unlimited data has us cautiously optimistic about his management style.