You Should Be Scared of Verizon’s Shared Data Plans [Opinion]

 

Verizon’s CFO Fran Shammo spoke at the JP Morgan Media and Telecom conference this morning, providing further detail on their plans for shared or family data tiers. During his conversation, he mentioned the end of grandfathered unlimited data plans, but before that he talked specifically about these shared tiers. While he didn’t go into detail on how they would be priced or structured as far as data amounts go, he did say that Verizon will have no problem making money off of them in the very near future. 

Here is the quote:

We want the connections to come in and the way we’ve designed our plan, this plan is built on tiers. And as we look at the future growth of LTE consumption because of the speeds and video consumption and consumption of other end-to-end type devices, it’s going to be more important that people will start to upgrade in the tiers as they start to really realize the benefits of the LTE network.

So two things here. One is, revenue will continue to grow as we get into data shared plans and people start to connect more devices (as my pad example). And then over the future time, as they add more devices, they are going to have to buy up in tiers. So again you will see the revenue increase there.

The way we designed this, we really shouldn’t see a short term decline.

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As I’m listening to him say all of this, my jaw slowly dropped to my desk and remained there for a few minutes. Investors and shareholders are probably ecstatic that Shammo feels this way, however, what about us, the consumer?

To me at least, all I took from this conversation was that these tiers have been researched and built so perfectly, that you and I will be forced to purchase up in them. There will be a base of sorts that your family can nibble on, but as we continue to realize how powerful LTE is and decide that we want to connect more and more devices to it, that we will also be forced to pay more and more. These weren’t created to make your life simple, although that may be one of the selling points. No, these were created with the idea that as data consumption grows, you won’t have a choice but to pay more to get more data to use. Welcome to the future of mobile data.

Look, again, I get that this is a business for Verizon and they need to make money. But with that said, the upgrade fees, online bill pay fees, ending of “New Every Two” deals, removal of 1-year contracts, and of course unlimited data have become a bit much. The scary thing is, that Verizon won’t be the only one to make this move. You can jump ship if you don’t like it, but don’t expect that your next carrier will avoid the shared data model for long. Verizon didn’t create this as a test, they created it to be the future.

I guess there hasn’t been a better time to upgrade.