AT&T vs. Verizon Wireless: How tiered plans will shake out

AT&T vs. Verizon Wireless: How tiered plans will shake out

Summary: AT&T and Verizon Wireless have both ditched unlimited data plans and the new tiered plans are likely to segment the market between high-end and low-end customers.

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AT&T and Verizon Wireless have both ditched unlimited data plans and the new tiered plans are likely to segment the market between high-end and low-end customers.

With both AT&T and Verizon earnings this week, analysts will largely be focused on smartphone data plans and the impact on churn rates and future revenue streams.

For starters, Verizon's move to tiered data plans is welcome news for AT&T, which moved earlier to ditch unlimited plans.

Among the key points:

  • AT&T has a $15 a month plan with a 200MB cap that encourages feature phone customers to upgrade to smartphones.
  • Verizon's cheapest data plan is $30 a month with a 2GB cap. That pricing could discourage some customers to upgrading to smartphones, according to Barclays Capital analyst James Ratcliffe.
  • Churn rates for both AT&T and Verizon are likely to remain static as similar data plan structures will keep customers where they are.

In the big picture, Ratcliffe noted that AT&T and Verizon have effectively carved up the smartphone market between low-end and high-end consumers. The inflection point between where AT&T becomes more expensive than Verizon shows up at about 4.5GB of usage a month.

The wild card here is Sprint, which is the last carrier with unlimited data plans. It's possible that Sprint could acquire more high-end smartphone users.

Related: Verizon kisses unlimited data plans goodbye

Topics: Smartphones, Hardware, Mobility, AT&T, Verizon

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25 comments
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  • RE: AT&T vs. Verizon Wireless: How tiered plans will shake out

    Sprint, here I come.
    Droid.Incredible
    • RE: AT&T vs. Verizon Wireless: How tiered plans will shake out

      @Droid.Incredible Tmobile still offers unlimited data.
      LarsDennert
      • RE: AT&T vs. Verizon Wireless: How tiered plans will shake out

        @LarsDennert T-Mobile also has failing coverage and an uncertain future in the US market.
        Champ_Kind
      • RE: AT&T vs. Verizon Wireless: How tiered plans will shake out

        @Champ_Kind But T-Mobile still has Carly Foulkes! <img border="0" src="http://www.cnet.com/i/mb/emoticons/happy.gif" alt="happy">
        usad
      • RE: AT&T vs. Verizon Wireless: How tiered plans will shake out

        @LarsDennert Do they still offer unlimited data? <a href="http://www.mp3kick.com">Free MP3</a>
        mrswilliamson
    • RE: AT&T vs. Verizon Wireless: How tiered plans will shake out

      @Droid.Incredible Aye, me too! <a href="http://www.ehireacar.com">Hire a Car</a>
      molly83
  • RE: AT&T vs. Verizon Wireless: How tiered plans will shake out

    The worrisome point is the driver by consumer provisioning companies (ex: Time Warner / HBO / Netflix / etc...) that are providing more and more streaming opportunities to the end user. This pushes even harder against the available bandwidth.

    Squeeze play :(
    rhonin
    • RE: AT&T vs. Verizon Wireless: How tiered plans will shake out

      @rhonin
      There are no standardized connections here in the US. Your choices range from Cable, DSL, Fiber, BBOPL, OC/Satelite and dialup (still). Not to mention faulty equipment at Latta changes and bad connections to your home. Just because you bought a 50m FIOS line from verizon doesn't mean you will ever come close to reaching that speed due to other providers connections. I have dealt with this for some time now. Streaming issues would not arrise if eveyone in the US were all on the same connection type. Speeds would more closely match what you pay for but the sad reality is not everyone, everywhere in the US can have fiber. As Long as connection caps range from 756k/s - 100m/s streaming content will always choke off the slower connection.
      Nate_K
      • RE: AT&T vs. Verizon Wireless: How tiered plans will shake out

        @Nate_K
        How fast it moves is not the same as how much is used;
        i.e. speed vs volume
        ChoMlo
  • RE: AT&T vs. Verizon Wireless: How tiered plans will shake out

    Research is taken with a grain of salt as there is no device available across all carriers. Stateside people go to the carrier that features the device they want OR stay with their carrier of choice due to corporate / family plan incentives.
    MobileAdmin
    • RE: AT&T vs. Verizon Wireless: How tiered plans will shake out

      @MobileAdmin
      Your correct MobileAdmin, not all devices are available for all carriers. However I noticed that it carriers with the iPhone and iPad have the tiered pricing plans so I assume they are trying ream users of these devices as much as possible since they will be users that will use the most data. Sprint and currently T-Mobile (soon will be ATT whenever the merger is approved, if they approve it. If not then T-Mobile) are some of the major carriers that don't have the iPhone or iPad so they don't have tiered data plans.
      Since my cell phone has broke yesterday I need to look for a new one so this information is useful for me to deciding to stay with my current carrier, Verizon, or jump to ATT or another carrier. Also I can decide to get the iPhone or another smartphone so this information helps.
      phatkat
  • RE: AT&T vs. Verizon Wireless: How tiered plans will shake out

    You gotta be nuts now adays to be with AT&T or Verizon as they are raping their customers. These moves basically just made Sprint the biggest winner as people will migrate as sprint has nation wide 4g/3G coveregae no caps and true unlimited everything for fraction of the lowest data plans the other 2 answer. They also own Boost which is no contract starting at $500 a month with shrinkage unlimited everythings. I now pay Boost $35 a month no contract unlimited data, tether, text, phone, web and love my evo on it. Good luck verizon and AT&T raping customers.
    Fletchguy
    • RE: AT&T vs. Verizon Wireless: How tiered plans will shake out

      @Fletchguy $500 a month seems pretty damned high for phone service - perhaps you meant $50/m? I have to say I'm seriously considering a return to Sprint once my AT&T contract is up... It would be a sure thing if Sprint got their hands on the iPhone as is the rumor but we'll see how that pans out.
      athynz
    • RE: AT&T vs. Verizon Wireless: How tiered plans will shake out

      @Fletchguy How have you managed to get down to $35 already? My husband uses their unlimited with shrinkage, and it takes 18mths to get down to this rate...shrinkage was only introduced in October...9 months ago...he's still sitting at $45-the same rate as my StraightTalk (tracfone) unlimited plan. You got contacts on the inside? ;) either way, Boost and StraightTalk, being prepaid, and priced lower than AT&T and Verizon, are definitely the way to go. Hubby and I haven't yet come to an agreement on which is better-he obviously says boost with bigger choice of smartphones, I say StraightTalk, cause I have more flexibility wrt choosing networks, as you can go for AT&T or Verizon's network, depending on which is strongest where you live. We may disagree on provider, but both agree prepaid is the answer.
      Jayjoy
    • RE: AT&T vs. Verizon Wireless: How tiered plans will shake out

      @Fletchguy

      Try again. Sprint doesn't have speeds anywhere CLOSE to Verizon's. 25Mbps vs 5? Yeah. Sprint's cheaper because they don't have the power behind it. Beyond that, they are slower with not nearly as many customers. People go to sprint and those already poor speeds will just go lower. LTE is already HERE for most people. Verizon's prices reflect the superior network QUALITY and superior speed. End of story.
      evilkillerwhale@...
  • RE: AT&T vs. Verizon Wireless: How tiered plans will shake out

    Yes but how long can Sprint stay unlimited before they start losing money? Sure they have a good corner in the market now but will they see enough of an influx of incoming customers to make staying unlimited even worth it, or will they cave and and create tiered plans in 6 months?

    No matter what carrier you have, what it all comes down to is the fact that cell carriers in general have us by the naughty danglies. Sprint in my opinion is a sinking ship that is desperately trying anything to patch the hole, but I think eventually they will exhaust their efforts, cave under pressure, and try something else unique.
    Bates_
    • RE: AT&T vs. Verizon Wireless: How tiered plans will shake out

      @Bates_
      Even if they do create tiered plans in 6 months, you will be grandfathered in to your 2 year contract. And maybe AT&T and Verizon will lose enough customers that in 2 years they're plans will be different. I would be willing to take that risk and switch over instead of letting them take advantage of us with their TIERED plans. Hopefully enough of us will switch to hurt their bottom dollar and make them reconsider.
      The &quot;V&quot;
    • RE: AT&T vs. Verizon Wireless: How tiered plans will shake out

      @Bates_

      I disagree. As we need more data, better technology is installed and used. The tiered plans are a way for the carriers to try and get off the hamster wheel. Obviously, if they don't update, they will become a lower level carrier. If Sprint stays with it, they will become the winner.
      Hameiri
      • RE: AT&T vs. Verizon Wireless: How tiered plans will shake out

        @Hameiri Good point, but I still think it's a flip of the coin at this point in time.
        Bates_
  • RE: AT&T vs. Verizon Wireless: How tiered plans will shake out

    Much ado about nothing! I use my iPhone almost 99% of the time on wi-fi.
    audreypeters