Verizon moved to bolster its unlimited data plan offerings by announcing a new, more generous premium tier for data hogs and giving customers more flexibility to mix and match tiers within family plans.
The carrier started offering an unlimited data plan in February of last year and added a lower-priced, more restrictive tier in August. Starting on June 18, Verizon is adding a third, more expensive tier, dubbed Above Unlimited, that will allow customers to use even more data before facing a potential slowing of download speeds and to use of the plan overseas without additional charges five days per month.
Unlike when Verizon introduced its first unlimited plan last year, at a weak point when it was losing customers, this year has been more positive for the company. Verizon added 260,000 regular monthly subscribers in the first quarter, compared to a loss of 307,000 of those most profitable wireless customers a year earlier, before it rolled out the unlimited plan.
But Verizon’s stock price has still struggled, falling 8% so far this year, as investors fret about future growth and the value of the company’s dividend at a time when interest rates are rising.
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“When I introduced the Verizon unlimited plan back in February of last year it was a real reset of the market and a game changer,” Ronan Dunne, president of Verizon Wireless, tells Fortune. “And we said at the time we would continue to evolve and expand that portfolio to broaden out the match with customers.” The new premium tier is aimed at “the person who wants it all,” he says.
The Above tier will cost $95 monthly for one line, with data slowdowns potentially kicking in after the use of 75 GB of data. The current Beyond Unlimited plan costs $85 for one line, with data slowing after 22 GB. And the lowest tier Go Unlimited plan, which can slow data at any time and degrades streaming video to DVD quality, starts at $75 per month.
Before the unlimited plans, Verizon customers would have to pay more or get cut off completely when they exceeded a set monthly data allowance. Now the carrier simply slows data speed at busy times and in busy areas for customers using too much data.
The new premium tier also comes with 500 GB of data storage in the cloud. The five days of free use overseas monthly are comparable to Verizon’s existing “TravelPass” feature, which currently lets a customer use their unlimited text, voice, and data overseas for $10 per day.
With Wednesday’s announcement, Verizon still reduces its charge per line for all three tiers of unlimited plans as a customer adds more lines. The new Above tier, for example, costs $90 per line per month with two lines, $70 with three lines, and $60 per line for four.
Another new change is that Verizon is allowing customers to select different unlimited tiers within a single family account. Under the carrier’s current rules, all lines must be on the same plan. With the change, for example, a family with four phones could have two on the Go tier and two on the Above tier. That would cost $200 per month.
The pricing puts Verizon above AT&T’s (T) unlimited plans, which start at $65 and $80 per month for one line and offers free HBO subscriptions. T-Mobile (TMUS) starts at $70 per month, without any added taxes or fees, and adds a Netflix subscription. Sprint (S) starts at $60 and offers a Hulu subscription.
Verizon (VZ) doesn’t give customers any added streaming video deal and isn’t signaling anything coming on that front. “There’s been a very positive, consistent trend in the performance in Verizon Wireless over the last few quarters,” Dunne says. “I think its fair to say objectively based on our performance since some of our competitors changed their offerings, we’ve not seen any increase in our churn…and we’ve continued to see high levels of customer engagement and satisfaction.”
