Verizon to drop Unlimited Data on 7/29, tiered pricing to follow?

[kodiak799]

Capacity issue... please. Verizon is a massive service provider and profits fistfuls of money. What they have is an inappropriate investment in infrastructure to pay high dividends to investors. Verizon's obviously done cost analysis and decided you won't leave them as a customer as they nickel and dime you some more because they're not investing in capacity expansion.

They don't need shiny new towers, they need to allocate more bandwidth on their (huge) fiber network and plan for the capacity in their upcoming 4G expansion.

The best thing consumers can do if it really matters to them is switch to sprint and tell Verizon and AT&T to stuff it. If enough people did it to make a difference AT&T and Verizon would drop tiered pricing in a heartbeat.

You obviously have no appreciation for concepts of cost of capital or return on investment. You just assume because there may or may not be spare capacity now that you should be entitled to use that free of charge for life.

It's not a necessary service they provide. There are multiple alternatives. Supply and demand will dictate what a fair price is in terms of value delivered. If VZW charges too much for the service they provide, they will lose market share and investors will boot out the execs. Ultimately they seem to have a much better handle on this issue than you do.

 

[haoleboy]

unlimited data

I call Verizon technical support concerning a tiered data plan, and dropping the unlimited service. They told me that they ARE NOT dropping the unlimited data service. They told me that the imformation I got is incorrect, Information I got here, at this site.

 

[kodiak799]

I call Verizon technical support concerning a tiered data plan, and dropping the unlimited service. They told me that they ARE NOT dropping the unlimited data service. They told me that the imformation I got is incorrect, Information I got here, at this site.

I would be surprised if they drop unlimited data (or at least a limit so high that it would be rather absurd to exceed), but I do expect a tiered pricing structure. We've had that for voice calls for years (which is why it's so comical that people act like this concept is some revolutionary new evil) and no one seems to think it's greedy or unfair. Different flavors for different people.

 

[NaterGator]

You obviously have no appreciation for concepts of cost of capital or return on investment. You just assume because there may or may not be spare capacity now that you should be entitled to use that free of charge for life.

It's not a necessary service they provide. There are multiple alternatives. Supply and demand will dictate what a fair price is in terms of value delivered. If VZW charges too much for the service they provide, they will lose market share and investors will boot out the execs. Ultimately they seem to have a much better handle on this issue than you do.

Obcviously I have no understand of MARR.

Go to VZ's investor relations page and look at their earnings reports and tell me they're anywhere near the MARR threshold.

This has been hashed out before but supply and demand virtually cannot dictate what a fair price is in this market because consumers are a captive audience to a oligopoly with extremely high barriers to entry (FCC regulations, high entry investment, necessity of high initial market penetration). The "BS-factor" comes into play when you consider the actual cost of increasing bandwidth capacity is relatively minor and there is virtually no justification for the prices charged for what bandwidth is allocated.

 

[bunklung]

Ignorance and Things to Ponder

This is all calculated by VERY VERY smart people WAY WAY up at the top of the food chain.

They are smarter than anyone on these forums and the general population, hands down. It's a fact.

Here some more facts:

1) Avg data usage does NOT go down over time. It will always go up. ALWAYS.

2) Today's heavy users, are tomorrow's normal users. I could also call normal users "I-never-go-over-xGB users".

I did not say abusers! Those are separate things. But please keep confusing the abusers with heavy users. That's exactly how they want you pawns and mouthpieces to think.

Except guess what? Tomorrow (aka the very near future) will be a 2G cap and that means everyone will go over it. REVENUE!!!!!!!!!! We'll all be going over the cap.

And anyone who thinks that ATT (and soon Verizon), is going to graciously move their caps up 200%, because in 5 years we'll all be using 200% more data, has got their head in the sand.

Let me repeat: We are all dumb. They are much smarter than us. We will save $5 today and pay $15 more in overages in the future.

We are all playing right into their hands.

Also, a message to the Me, Myself, and I "Grandfathered" people. Since when is grandfathering a right. It can always change. We too will get dragged into this mess, just not right away.

BUT PLEASE, keep thinking, "screw the heavy users, I will never use more than X". And please keep confusing heavy users with abusers. And please keep reminding yourself to only use plain text e-mail service and nothing more, because that's all you will ever need in the future... just like 640KB system memory.

 

[eclsnowman]

Very, very well said.

This is all calculated by VERY VERY smart people WAY WAY up at the top of the food chain.

They are smarter than anyone on these forums and the general population, hands down. It's a fact.

Here some more facts:

1) Avg data usage does NOT go down over time. It will always go up. ALWAYS.

2) Today's heavy users, are tomorrow's normal users. I could also call normal users "I-never-go-over-xGB users".

I did not say abusers! Those are separate things. But please keep confusing the abusers with heavy users. That's exactly how they want you pawns and mouthpieces to think.

Except guess what? Tomorrow (aka the very near future) will be a 2G cap and that means everyone will go over it. REVENUE!!!!!!!!!! We'll all be going over the cap.

And anyone who thinks that ATT (and soon Verizon), is going to graciously move their caps up 200%, because in 5 years we'll all be using 200% more data, has got their head in the sand.

Let me repeat: We are all dumb. They are much smarter than us. We will save $5 today and pay $15 more in overages in the future.

We are all playing right into their hands.

Also, a message to the Me, Myself, and I "Grandfathered" people. Since when is grandfathering a right. It can always change. We too will get dragged into this mess, just not right away.

BUT PLEASE, keep thinking, "screw the heavy users, I will never use more than X". And please keep confusing heavy users with abusers. And please keep reminding yourself to only use plain text e-mail service and nothing more, because that's all you will ever need in the future... just like 640KB system memory.

Sent from my Droid using Tapatalk

 

[Mikes85]

It's just a game of wait and see......now Endgaget also likes to exaggerate...here's an article released 4 days ago that's a little more objective.

Verizon Wireless: No big rush to tiered data plans (for now) | ZDNet

 

[jsh1120]

This is all calculated by VERY VERY smart people WAY WAY up at the top of the food chain.

They are smarter than anyone on these forums and the general population, hands down. It's a fact.

Here some more facts:

1) Avg data usage does NOT go down over time. It will always go up. ALWAYS.

2) Today's heavy users, are tomorrow's normal users. I could also call normal users "I-never-go-over-xGB users".

I did not say abusers! Those are separate things. But please keep confusing the abusers with heavy users. That's exactly how they want you pawns and mouthpieces to think.

Except guess what? Tomorrow (aka the very near future) will be a 2G cap and that means everyone will go over it. REVENUE!!!!!!!!!! We'll all be going over the cap.

And anyone who thinks that ATT (and soon Verizon), is going to graciously move their caps up 200%, because in 5 years we'll all be using 200% more data, has got their head in the sand.

Let me repeat: We are all dumb. They are much smarter than us. We will save $5 today and pay $15 more in overages in the future.

We are all playing right into their hands.

Also, a message to the Me, Myself, and I "Grandfathered" people. Since when is grandfathering a right. It can always change. We too will get dragged into this mess, just not right away.

BUT PLEASE, keep thinking, "screw the heavy users, I will never use more than X". And please keep confusing heavy users with abusers. And please keep reminding yourself to only use plain text e-mail service and nothing more, because that's all you will ever need in the future... just like 640KB system memory.

You're almost certainly correct that data use for the average user will go up as time goes by. So will aggregate use as the proportion of "smart phones" goes from the mid-20's toward 100% of all devices. Those who believe they will save money with tiered plans are almost certainly incorrect.

And as far as "abuse" is concerned, I have no objection to your using as much bandwidth as you like, just as I do.

Now just explain to me why I should pay for your use.

 

[kodiak799]

Obcviously I have no understand of MARR.

Go to VZ's investor relations page and look at their earnings reports and tell me they're anywhere near the MARR threshold.

good lord, MARR?!? Did you just learn about that in your college finance course? Besides, you seem to feel that the correct MARR is whatever you think is fair, which is simply ridiculous.

Go look at VZW operating margins and tell me if it is out of line with norms in the tech/telecom industry.

Then try to wrap your arms around this fact: VZW has spent $23 BILLION on it's fiber/FIOS network. with some 18 million subscribers, it's just now approaching break-even on its investment.

The oligopoly point, while a good one, is misguided. That is an issue only when the good/service is a necessary one. No one HAS to have a cell phone (although you can make a good argument for a cell as necessary these days), but certainly smartphone data is a luxury item so oligopoly pricing power or not, supply and demand still determines prices because people can always choose NOT to purchase. It's not like oil where there's a very real concern of collusion arbitrarily fixing prices at unfairly high levels because people have very limited alternatives and opportunities to reduce consumption.

 

[czerdrill]

i'm still confused about being grandfathered...if you upgrade your phone do you lose unlimited, if they move to tiered plans? or is it only if you change your plan?

 

[kodiak799]

1) Avg data usage does NOT go down over time. It will always go up. ALWAYS.

2) Today's heavy users, are tomorrow's normal users. I could also call normal users "I-never-go-over-xGB users".

I did not say abusers! Those are separate things. But please keep confusing the abusers with heavy users. That's exactly how they want you pawns and mouthpieces to think.

All good points except for the very last non-bolded sentence.

LTE IS adding capacity and bandwidth, and it's also a more cost-efficient technology.

All this whining....it's been a fact for me (and I suspect many others) that while my cell bill has been increasing, the value I received has also been increasing.

I have not had a land line for years. The cost of my minutes plan has been virtually unchanged for about a decade, and my minutes allowance is probably a little higher. LTE brings the potential to drop my home broadband - I'll again be paying more, but realizing a net savings.

Also, there seems to be some misconceptions about the cost of adding bandwidth. VZW is not an R&D shop, and as such there are much more limited economies of scale. The cost of adding new towers is mostly linear (outside of scale on licensing agreements). If usage doubles, forcing VZW to add a tower, they are losing money on those customers and so either have to limit usage (in order to add subscriptions) or charge more. VZW's service costs (excluding SG&A) including depreciation last year were almost 60% = $60B on $107B in revenues.

In other words, 60% of every dollar you give VZW is going to infrastructure cost. This means, in fact, is you use DOUBLE what they planned for in their models they are losing money on you (a cost to them of $1.45 for each $1 of revenue on you vs. $0.85 for a normal user). And those claiming that extra usage should be "free" because it's spare capacity are misguided - that spare capacity could and would be sold to another user in the near future so it is an opportunity cost to VZW and that's why you should pay for it.

Now, to the extent technology and investment can stay ahead of demand (as it has, at least with VZW to this point), I'd agree they don't need to change pricing structure. And so I'll again bring this full circle to point out that the min. cell plan has been largely unchanged for years. If LTE is indeed more cost efficient, then expect consumers and VZW to SHARE in those efficiencies (i.e., you ditch home broadband and save $50 a month, and that tier of usage might cost you an extra $30 a month).

 

[kodiak799]

Those who believe they will save money with tiered plans are almost certainly incorrect.

Agreed, but I think they will be getting increasing value. Some people may simply ditch home internet all together (I wouldn't because I prefer the larger screen of my laptop), and that sort of usage shifting is a real cost savings to them, even if they pay $15 a month more for the increased usage on their cell.

Also, I expect VoIP use to increase significantly in coming years, especially with LTE. I know FREE VoIP (not sure if that will last though, but still cheaper than cell) can be done - maybe not quite business-use quality yet - but I haven't figured it out. In that scenario, choosing a minimum calling plan because of the saving offered by VoIP is also very real.

And not to mention a dual-use plan to tether at home and replace broadband, another likely savings.

As I mentioned, I've not had a home land line for years, and that's a real savings. Also, maybe we'll see a gradual shift in corporate accounts to get a discount or provide a per-diem to employees to purchase a smartphone and set-up a corp. e-mail account on it. I know some IT depts want to control those devices, but consumers also don't want to carry multiple phones, either. A savings of $$$ for the company and a savings of convenience for the employee.

 

[Droid101]

Not sure if this has been posted here or not but it looks like for the time being your safe on 3G as far as tiered pricing.

Verizon CFO Denies Tiered 3G Data Plans are Imminent - Droid Life: A Droid Community Blog

 

[-MikeR-]

Come on i want some of Barry's 3G stash. HAHAHA ainkiller:

 

[Azmordean]

Tiered data plans are stupid. Not that I am advocating necessarily for unlimited plans - they are a bad deal for a lot of users.

BUT, why have a tiered structure? Why not a variable structure where you pay for what you actually use?

How about $15 for the first 1GB, then $5 for each additional 500MB.

Variable pricing isn't what pisses me off. It's the whole idea of "overage penalties." Cellular bandwidth is limited, I get that - so charge for what people use. But don't set some arbitrary number then totally nail people who go over it. Totally oligopoly pricing there - how much would you bet VZW's pricing exactly matches AT&T's?

The other thing that's stupid with ATT pricing is almost everyone uses over 200MB and very few use 2GB. So they screw the majority of users by forcing them to buy more than they need, then screw the power users by charging huge overage fees.

That's the cellular motto though - screw all of our customers, all of the ways we can.