Verizon data caps coming, probably by mid-summer
HTC Thunderbolt launch will offer insight on prices
Computerworld - Verizon Wireless will join AT&T in adopting data caps soon, probably in mid-summer, Verizon CFO Fran Shammo said at an investor's conference Tuesday.
The precise timing for the move to a tiered-pricing scheme has not been announced, however. AT&T put an end to unlimited data plans for new customers last year.
Verizon has been offering the iPhone 4 since Feb. 10 with a $30 unlimited plan, which applies to other smartphones it sells that run on the Verizon CDMA/EV-DO network.
Shammo said some of the details of the data caps and tiered pricing will come when Verizon launches the HTCThunderbolt on LTE soon. Thunderbolt will have a 4.3-in. screen and run Android, Verizon said in January.
"We will be launching the HTC Thunderbolt very shortly here and then that will give you a flavor of our tiered-pricing structure going forward," Shammo said in comments delivered at the Morgan Stanley technology conference in San Francisco.
Later, he said, "We are going to [a] tiered pricing structure..., probably in the mid-summer timeframe."
The unlimited $30-a-month option on Verizon's EV-DO data network remains in place for now to avoid putting up a barrier to new customers. "But that was never a long-term strategy," he added.
While he didn't reveal details of tiered prices, Verizon charges $50 a month for 5GB of data and $80 a month for 10GB for LTE dongle devices, which could be in line with the pricing for smartphones and tablets, some analysts said. Since HTC Thunderbolt runs LTE, Shammo's comments tend to support similar data pricing for smartphones.
Other Verizon executives have talked for months about the need to set up tiered pricing plans. The move is seen as a way to limit the use of its networks, which will grow with the sale of more smartphones and tablets that consume video and other data.
"Everyone knows unlimited data on wireless networks is unsustainable," said Jack Gold, an analyst at J. Gold Associates. He was reacting to Shammo's comments today.
"This says that Verizon is finally getting its usage up to the point where it needs to takesome proactive action to make sure it doesn't have its network saturated. And it says that some users will be outraged, but the majority who don't use that much data anyway probably won't even notice and may actually be able to pay less for a lower limit. Bandwidth/data capacity is a limited commodity, and commodity pricing models are in play here, just like in all other limited commodities."
Shammo also said only 26% of its customers use smartphones, a number Verizon hopes to double to 50% by the end of the year, especially with more LTE smartphones running on Android that Verizon plans to launch this spring. He said some Android users are upgrading to the iPhone, but didn't elaborate.
He added that dongle users on LTE are "using a lot more [data] than they anticipate" and predicted customers will adjust. Verizon still hopes to sell 11 million iPhones by the end of 2011, he said, confirming earlier estimates.
Also, about 70% of the Motorola Xoom tablet customers are either existing Verizon customers new to tablets or customers new to Verizon entirely, he said. The tablet will be upgradeable to LTE in about two months, he said.
The Xoom has been on sale since Feb. 24, though he didn't disclose sales figures.
Matt Hamblen covers mobile and wireless, smartphones and other handhelds, and wireless networking for Computerworld. Follow Matt on Twitter at @matthamblen or subscribe to Matt's RSS feed. His e-mail address is firstname.lastname@example.org.
Read more about Mobile Apps in Computerworld's Mobile Apps Topic Center.
- Use the Mobile App Mix to Choose an Enterprise App Store Strategy In this research report Gartner outlines how organizations can optimally secure, distribute, and manage mobile applications for employees and contracted workers.
- The Case for Mobile Apps Today's mobile apps turn handheld devices into e-book readers, portable navigation systems, digital wallets and more. And for organizations with mobile workers, they...
- The 5 Big Lies About Going Mobile You've heard about the power of mobile to change your business. But have you realized your mobile potential? It's about much more than...
- Transforming enterprise applications for mobile environments This new white paper explains how Dell Application Modernization and Development Solution Set can help you understand when to develop new mobile apps,...
- What should I look for in a Next Generation Firewall? SANS Provides Guidance With so many vendors claiming to have a Next Generation Firewall (NGFW), it can be difficult to tell what makes each one different....
- Why Are Customers Really Deploying an NGFW? It seems every IT Security expert is talking about the NGFW, but what are people really doing? This webcast covers 5 real-world customer... All Mobile Apps White Papers | Webcasts
Our new weekly Consumerization of IT newsletter covers a wide range of trends including BYOD, smartphones, tablets, MDM, cloud, social and what it all means for IT. Subscribe now and stay up to date!