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."


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

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