Technology First Look

Verizon gives its customers unlimited data plans

Verizon recently announced that for the first time in more than five years, it would begin offering unlimited data plans for its wireless customers.

A Verizon store in North Andover, Mass., advertises the company's latest offerings, July 2016. Verizon is the latest mobile carrier to bring back unlimited plans, but its version is pricier than offerings from rivals T-Mobile and Sprint.
Elise Amendola/AP
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After ditching unlimited data offerings five years ago, Verizon Wireless is once again offering customers an unlimited data, talk, and text plan, beginning Monday.

Currently the largest wireless carrier in the United States based on total subscribers, Verizon has lately seen competitors begin closing the gap, especially as AT&T, T-Mobile, and Sprint have begun to offer increasingly competitive unlimited programs.

Verizon’s new offering will begin at $80 per month for a single line, or on sliding scale for group plans: $70 each for two people, $54 each for three, or $45 per month apiece for a group plan of four smartphones and tablets. Plus taxes and fees, of course.

By comparison, just last week Sprint announced the addition of a new five-line unlimited plan for $90; although as CNET reports, the pricing on Sprint’s plan increases after the first year.

Roger Entner, a telecom analyst with Recon Analytics called Verizon’s latest move “inevitable,” reported USA Today. He had expected such a decision, he said, but it came “a bit earlier than expected. But only by months, not by years.”

While both T-Mobile and Sprint have previously included unlimited offers, those plans had drawn criticism from consumers over some of their policies. For example, T-Mobile’s unlimited plan downgraded all video streams to below high-definition levels unless their subscribers paid a $15 add-on fee.

T-Mobile also did not allow access to LTE speeds when using a wireless device as a hotspot. 

Verizon appears to have addressed both of those complaints specifically, promising 10GB of LTE for mobile hotspot usage and HD-resolution streaming.

However, T-Mobile continues to whittle away at AT&T and Verizon's dominance. According to mobile insight company OpenSignal, Verizon remains the leader in 4G service, but T-Mobile and Verizon "are again tied in network speeds ... but T-Mobile continues to chip away at Verizon's vaunted lead in 4G availability." OpenSignal's testing places T-Mobile less than two percentage points below Verizon in availability.

This rapidly closing gap was recently reflected in new customer numbers as well, as Verizon added just 591,000 wireless subscribers in the fourth quarter of last year, half as many as T-Mobile over the same period, according to Chicago Tribune.

However Jennifer Fritzsche, an analyst at Wells Fargo Securities, told the Chicago Tribune that Verizon's recent strategy "offers a 'fightback' moment for the company." She continued, "with this move – [Verizon] is very much back in the conversation." 

It remains to be seen whether AT&T will follow suit. At present, AT&T offers only one unlimited plan, which begins at $100 per month and is only available to new customers whose subscription comes bundled with their DirecTV or U-Verse home television services. Otherwise, existing customers who have been grandfathered into their unlimited plan continue to have the same access for $100 per month without the other bundled services.

The biggest catches with Verizon’s newest offering are shared by most similar plans, including the requirement that customers sign up for auto payment and that any line using more than 22GB of data in a given month may see their plan prioritized behind other users during peak congestion times.