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Q&A on Verizon's new tiered data plans

Michelle Gilbert from Verizon Wireless provides some answers to questions about Verizon's new tiered data usage plans.

On July 7, 2011, Verizon replaced its unlimited data plan with tiered data plan offerings. As a Verizon customer, when I heard the news, I had quite a few questions about the changes. Fortunately, I was able to catch up with Michelle Gilbert (Verizon Wireless), who helped provide the following answers.

Q: What is the breakdown of the new tiered data plans? A: "For consumers, there's a 2 GB plan for $30. 5 GB for $50, and 10 GB for $80. If you go over each month, it's $10 per GB more. So, if you have the 2 GB plan and you went over by a GB, instead of paying $30, you'd pay $40 that month.

"Corporate-based pricing is slightly different. Corporate customers will actually pay $45 for 2 GB of data, but that includes corporate email. For now, business email is included in the 5 GB for $50 and 10 GB for $80 packages.

"For our feature phones, we do offer a $10 for 75 MB plan - so if you have a feature phone (not a smartphone), but you do plan on using VZ Navigator or downloading some music, that still uses data, so you absolutely want to have that $10 data plan, because you don't want to do the pay-as-you-go."

Q: What does this news mean for preexisting customers who currently have the unlimited data plan? A: "As long as you're already an existing customer (consumer or corporate) with an unlimited data plan, it doesn't affect you at all. You keep your same data plan, even if you upgrade to a new smartphone. If you were to add a new smartphone line, that new phone line would have to select one of the new data pricing plans. But if you add a mobile hotspot, take away the mobile hotspot, add VZ Navigator, or take away VZ Navigator... as long as you don't make a change and drop your unlimited data pricing, there will be no affect to your data plan. Once you take it away, we can't re-add it.

"But honestly, even if that did happen, there's a 95% chance that you would still be paying $30 a month, because only 5% of our smartphone customers use more than 2 GB of service. So, if you're a new customers or adding another line to your account, chances are pretty likely that you will still be paying $30 a month if you just get 2 GB. Most people don't use the unlimited beyond the 2 GB. So, it's kind of a wash."

Q: Why did Verizon moved to the tiered data plan pricing model? A: "The reason that we've gone to the usage-based pricing model is really preparing for the future and where we see data usage going. Data growth has been exponential, and 4G LTE has just launched. So, the amount of data that businesses and users are going to use a year from now or two years from now is mind boggling. We are really trying to set up a pricing model that is going to benefit all customers in the future so that you pay for what you use.

"We could have gone another route and increased everybody's data plan, still giving you unlimited, but you would have been upset, because you're not using that much data, and it wouldn't be fair for you to pay for someone else's usage. It truly is in the best interest of all of our customers, and we don't want any of our customers to not have the best possible experience on our network, because that's the main reason why most people come to us."

Q: How do Verizon's new tiered data pricing plans compare (cost and size) to the plans of other mobile providers? A: "The one thing that differentiates our pricing plans from our competitors is the value that our network offers. We have the fastest and most advanced 4G network. No other carrier comes close to our data speeds. So, you're getting more value, because you're getting faster service. Even if you're in a 3G market, we've got the largest and most reliable 3G network across the country. So, again - you get what you pay for.

"Sprint, for example, advertises an unlimited data plan, but that's only when you're on their network. If you are not on their network, then you are roaming on one of their roaming partner's networks. It says right in their contact that they will limit you to 300 MB when you are off their network. So, consumers need to be aware when they are comparing their shopping of the real rules of the game.

"If smartphone customers are only motivated by price, and it's worth it to them to save $5 a month, then another provider might have the right plan for them - but again, they won't be getting the same value, network speed, and reliability."

Q: What kind of safeguards do Verizon customers have for avoiding overages? A: "You can set up to get alerts right from our Verizon Wireless web site to let you know when you are getting close to your various data usage points. You can also check it right from your device by dialing #data, and it will tell you how many KB that you've used.

"On Android phones (actually, on Apple phones also), we have a My Verizon Mobile app and a Data Usage widget. You can just click on the widget and it will pull your data so that you can see how much you've used that month (or payment cycle) right from your device.

"All of our smartphones are Wi-Fi capable, so we recommend that if you're at home, and if you pay for Internet service and have a Wi-Fi system set up, you might as well take advantage of that system and preserve your data on your phone.

"For people who are just trying to determine what plan they should be at and how the changes will affect them, we have an estimated data calculator. You go in and say how many emails you send per day or per month, how much video you stream, how many pictures you upload to your favorite social media site, etc. You should do it for the fun of it, just to see where you're at, and I bet you'll be surprised how much (or little) data you actually use.

"For example, in one month, a customer could send 1,000 emails, visit 200 web pages, listen to 20 hours of radio, upload 50 pictures to Facebook, and watch one hour of streaming video, and they would still be under 2 GB for the month.

"If you're going to be streaming 5 hours of video every single day, then you will definitely want to be looking at one of the higher data plans. The 5% of our smartphone users who use more than 2 GB per month are with us because they use that much data and they know they need the reliable network.

"Of course, we give our customers the flexibility to change their rate plan, whether it's their voice or data plan, to make sure they don't have overage charges. They can do that at any time without any penalties. I think it's a very good idea to check every month, for both the voice and data, so that there aren't any surprises. You only pay $10 for each GB over, but if you were closer to the 5, you would be better off going to the 5 GB plan versus paying for the 2 GB plan and $10 per GB after. So, it's really about being savvy about your billing, just like you would be with anyone else you do business with."

About

Sonja Thompson has worked for TechRepublic since October of 1999. She is currently a Senior Editor and the host of the Smartphones and Tablets blogs.

16 comments
'techy'
'techy'

So seriously, sprint offers unlimited data for $70 single and $130 family and their bashing sprint because they offer 300mb on roaming coverage, 300mb is still enough for surfing the web and some youtube for a month, and really, when are you roaming, vacation??? I never roam unless I go on vacation or drive somewhere in the middle of no-where where I might have roaming in some spots, even on vacation, rarely happens to me. Check out some plan comparable data plans: SINGLE: sprint 69.99 (unlimited); verizon 89.99-139.99 FAMILY: sprint 129.99 (unlimited); verizon 149.99-199.99 Techies might go for verizon's insane pricing, but sprint will win over most single and families. This is a very bad move for verizon. People don't want to see limitations, that would mean they would have to balance data used from allowable data, no-one wants to do that. If LTE is so expensive, why not allow 4g plans with extreme pricing and 3g plans with affordable pricing. There isn't 4g in the majority of the US, who wants to pay for something they don't use. Sprint offers $10 extra a month if you want to use 4g service, so people have a choice of what they want. Verizon is milking money out of people, that's selfish to me.

mcijeffb
mcijeffb

I had a (externally purchased) android and went to turn it on the day this took effect. I hope market forces come to bear and cause Verizon to rethink this policy. The answer to A(ssociated) T(hugs) and T(hieves) "iPhone problem" is to bolster their network, and the same goes for Verizon. I use my android to see emails, see chats, answer and make Skype calls away from home (and no - I refuse to forward and unforward Skype every time I change locations) and download books. I doubt I will exceed my 2GB limit (movies on a 4" screen aren't appealing to me), BUT on the outside chance I am someplace without a adequately secure WiFi I would like to be able to tether and do minimal web based activities.

Tink!
Tink!

I just checked my phone estimated data usage. There's still a week left to go before the billing period ends and I'm at 1.28 GB. Less than 100 emails sent/received 1 picture uploaded to FB 2-3 daily visits to FB Newsfeed 20 pics uploaded to Photobucket 10 hours of radio 50 website visits Online games I think the big data cruncher is probably the online games. Although I'm not on them constantly, I do have to check on them periodically throughout the day. From what I've seen of smartphone users around me...online games are quite common..i.e. "average" and therefore the average user could easily go over 2GB in a month.

bcdugan
bcdugan

I have free internet access almost any place I am except when driving, so I don't need it in a phone. Now, I can't get a 'DUMB' phone and I can't turn off or block the 'features' I don't want. Their 4G network won't be fully operational until 2013. It won't be in my area until late 2012. I've been a VZW customer for over 10 years and up till now, been happy with service and cost. Unless they change their pricing scheme and/or product offering, I will be probably switch to another carrier or drop my cell phone when my contract is up. It can easily be replaced by VOIP or other services. All I need is an internet connection.

neilpost
neilpost

There is only one question needed Q/ Verizon, are you a bunch of data double charging robber barons A/ Yes.

Slayer_
Slayer_

I maxed it out I think, it only allows 1 hour max of video, I'm closer to 3 hours a day. Which probably means I am way over my 60 gig limit. Plus I download on average, about a gig of files a week. Plus about 10 gigs of torrents a week. Plus audio streaming, plus weekend gaming marathons where I online game for 12 hours straight....

schmeep
schmeep

Said:"The reason that we???ve gone to the usage-based pricing model is really preparing for the future and where we see data usage going." Tacit:"We know that right now, we can get you on board with this. However, we're planning on the cloud/hd on our systems in order to gouge you. In 2 years, 2gb will seem laughable."

dan
dan

...it means that 5% of their customers are going to pay at LEAST $20/month more. That's quite a bit more income. Can we see an open accounting of where our additional $20/month is going? New routers? Faster data pipes into congested markets? More cell towers?

jeb.hoge
jeb.hoge

I ran the VZ data usage widget on my Android phone for several months. I use it pretty heavily...it's not uncommon for me to recharge in the late afternoon and then be back down to 1/3 charge by bedtime. Lots of social media, mainly. Anyway, even in months where I was using Google Nav over long distances (1300mi trip) and relying on my phone to be my digital lifeline, I never came close to 2GB. I think 1.5GB was the max. What I didn't do in that time was stream audio or watch videos all the time.

davidbteague
davidbteague

When the time comes to replace my el cheapo LG nearly feature less phone, and I can't find at least as dumb a phone to replace it, I'll definitely get a JitterBug or equivalent. All I need is a TELEPHONE, and that mostly for emergencies. Even Verizon (who has the best coverage here in the boondocks) has extremely poor coverage out here in WNC. Sheese.

The Cars Forever
The Cars Forever

Your description is definitely not the 'average' user and likely puts you in the 5% discussed. Most users don't have the level of activity you note on their DSL/Cable account let alone their cellular data device(s). That said, I agree with the post noting that this is setting us up for higher costs in the future. I can easily see a day when folks give up their 'land line' data service similar to what has been happening with land line voice service. I suspect this in addition to the serious increase in data use by mobile devices is likely why Verizon and AT&T are changing their plans. Those of us with unlimited data plans better hold onto them as long as possible!

Tink!
Tink!

Games that must have internet access to work are going to use up that data limit fast. Just out of curiousity, I'm going to NOT change my habits for the next week and see if I go over 2 GB. :)

Slayer_
Slayer_

They frequently watch Netflix, though at SD resolution, they would easily exceed 15 gigs. I think as such services become more common, data usage will go up. Verizon is obviously getting ready to bend its customers over, so they can slowly f##k them in the a##.

Slayer_
Slayer_

Cell phone data plans are far to expensive here, a single cell phone with data would cost 150 to 200 bucks a month on a 3 year contract. That's nearly 7200 after 3 years. That's an expensive service...

The Cars Forever
The Cars Forever

Hi, I think a lot of folks would exceed 2GB-4GB on their land line services, but your folks exceed 15GB on a cellular device? I doubt there are a lot of customers exceeding this threshold on a portable device that using cellular data only. I do believe that this is setting up higher data use fees in the future as more services move to portable devices and/or people start dropping their home DSL/Cable/FiOS data service and use their cellular data exclusively. Right now I doubt this change will impact many Verizon or AT&T customers. That said, 3-5 years from now cellular data use will be ubiquitous and customers will utilize a much higher amount of data. This is when the change we are seeing will really impact customers. Of course, many customers will be new to the world of data services and even those that remember 'the good ole days' of unlimited data will end up accepting the situation because there are limited choices for wireless providers.

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