Verizon Communications Inc. (NYSE:VZ) has returned to unlimited data plans to better compete with the competition. With the new plans, Verizon customers will get as much talk, text, and data as they want per line.
Verizon’s unlimited data plan starts at $80 per month and goes up to $180 for four lines. That is only $10 more than a current Verizon plan that includes just 4 gigabytes of monthly data. Customers must agree to AutoPay and paper-free billing to enroll in the plan. Verizon said several smaller data plans would remain for customers who wanted to pay less.
Monthly data allowances is one of the wireless industry’s most hated practices. Predicting how much data a user will use in advance is hard to do accurately. Those who make a mistake waste money if they are paying for too much data or are hit with overage fee charges if they exceed the allowances. A 2014 study estimated smartphone users in the U.S. were overpaying about $45 billion a year for data.
Verizon previously said it had no interest in unlimited plans. The industry phased out the plans as customers began overwhelming all of the carriers’ networks.
T-Mobile and Sprint introduced slightly cheaper unlimited plans last summer. T-Mobile’s unlimited plan starts at $70 and goes up to $160 for four lines. The rate includes all applicable surcharges and fees, effectively cutting its unlimited price by at least another 10 percent.
Sprint’s unlimited plan starts at $60 per line and goes up to $150 for four lines. Sprint is also offering 5 lines for only $90 per month for the first 12 months in a limited promotion this week. AT&T offers an unlimited plan to customers who subscribe to its DirecTV satellite service starting at $100 for the first line.
Customers on unlimited plans will likely use more data, which could affect the efficiency of Verizon’s network, but Verizon said it had added enough advanced equipment to handle more traffic. In a statement, Verizon Wireless President Ronan Dunne said, “We’ve built our network so we can manage all the activity customers undertake.” Verizon said it would not downgrade the quality of streaming video for unlimited plan users, but download rates may be slowed after 22 GB per line per month.
Verizon reported that it added 2.3 million post-paid customers, the most lucrative type of monthly customers, in 2016, about half the 4.5 million it added in 2015. On January 24, the company told Wall Street not to expect its revenue to grow in 2017. Shares of Verizon have lost 7 percent since that no-growth announcement.