Verizon in the United States will tomorrow announce a return to unlimited data plans, a seemingly small change which will have major implications for mobile carriers around the world.
As smartphones became more popular, unlimited plans were removed by most providers, on the basis that there was too much money to be made in charging for excess data. Some carriers chose to offer plans with limitless data, but they also with numerous restrictions, such as no access to high definition, and significantly reduced speeds. Verizon’s package appears to lack these restrictions, apart from pointing out that in the case of overload, if you’ve used crazy amounts of data already, your account will be deprioritised next to other customers.
The reason this move is important is that it shows a seismic shift in strategy for Verizon, and other operators will need to be quick to catch up. As the competition heats up in the mobile phone market, with Google, Samsung and Apple all angling for market share from a hardware standpoint, and retailers battling it out in a highly competitive market, the importance of apps, games and interactive entertainment- such as augmented reality in the form of Pokémon Go, and virtual reality through applications combined with VR goggles- has become more obvious. Where suppliers would previously say that a certain amount of data is, “plenty,” and maintain the strategy of making a modest amount of money on the phone, on the basis that additional data charges will make up for it, they are now being forced to re-evaluate.
Verizon has also seen the opportunity to help parents, with family plans enabling unlimited usage across several devices, no doubt a relief for the parents of teenagers and Pokémon fans across the United States.
It will be interesting to see how the competition reacts to this aggressive move on the part of Verizon, who are no doubt banking on their competitors failing to move quickly. While there are no firm statistics as to how many mobile phone users will be out of contract and able to make the transition, it’s highly likely that the offer of being able to do anything on a smartphone, including downloading movies, playing games and accessing email, without worrying about data restrictions, will be far too enticing for many to pass up.
Hopefully, a successful campaign by Verizon will mean other suppliers around the world will duplicate the strategy.