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Verizon to end grandfathered unlimited data plan

4:47 PM, May 17, 2012   |    comments
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  • Fran Shammo, CFO of Verizon Communications, which owns a controlling share of Verizon Wireless, first revealed the change Wednesday at an industry conference and it was first reported by Fierce Wireless, an online publication.

    Verizon is expanding the latest generation of its wireless network, called 4G LTE. Customers wanting to upgrade phones from their current 3G data plan to use 4G LTE will be required to sign on to Verizon's new data-share plan to be introduced this summer, Shammo said.

    The data-share plan, whose pricing hasn't been announced, will provide a limited bucket of data that can be shared among family members or devices.

    "As you upgrade in the future, you will have to go onto the data-share plan," Shammo said. "A lot of our 3G base is unlimited. As they start to migrate into 4G, they will have to go into the data-share plan. And that is beneficial for us."

    Verizon dropped its $30-a-month unlimited data plan last July for new customers. But it let existing subscribers keep their unlimited data plans, even after their contracts expired or they upgraded to 4G LTE devices.

    For a limited time, they still will be able to do that, at least through the new contract. Verizon wouldn't specify when the change for current customers will kick in. Until then, spokeswoman Brenda Raney said, nothing changes. "Unless Verizon releases more details about this, there could be some customers who might go ahead and try to lock in their current unlimited plan while upgrading to a new phone," says Roger Entner, analyst at Recon Analytics.

    Still, the move is sure to draw the ire of "grandfathered" customers who remained loyal to Verizon to keep their unlimited data plans, says Ross Rubin, an analyst at tech research firm NPD Connected Intelligence.

    Because the new LTE network is faster, it likely will drive subscribers to consume more data. Verizon's plan to herd all users into pay-as-you-go plans reflects its efforts to generate more revenue to pay for its new network, Rubin says. "They used the 3G network to prime the pump for data consumption."

    Sprint and T-Mobile offer unlimited data plans. T-Mobile slows data transmission after 2 gigabytes for users with its basic unlimited plan.

    Roger Yu, USA TODAY

    USA TODAY

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