Verizon Wireless, the nation’s largest mobile carrier, announced they are changing up how they will bill for data services across devices. The new plan, called Share Everything, means new customers and current customers who choose to opt in have one decision: how much data they want to pay for per month.
We’ll get to why it’s significant, but here are the basics if you’re a customer.
New pricing plans will go into effect on June 28. New customers must join these plans; existing customers will not be not forced to switch.
Who is affected and how?
Business users with multiple devices — including smartphones, MiFi hotspots and tablets with roaming data plans — might be interested in simplifying their bills, but they may be charged penalties if they are switching out of contracts.
A family with multiple smartphones and tablets might see the benefits, but be careful to keep track of how quickly the data gets used. Watching a streaming movie on a tablet can get very expensive very fast.
Current users of unlimited data plans will not be forced to switch. However, if or when they upgrade their phones through Verizon and they want to keep unlimited data, they will have to purchase the phone at full price. (To put that in perspective, the iPhone costs $649 off the shelf).
How do I figure out if this plan is right for me?
As part of the Share Everything announcement, Verizon has set up a calculator , but the third question in the calculator ironically will not help customers who are trying to get an idea about how much data they should be paying for. Verizon has a better calculator that might help you see how quickly data adds up per month.
In this case, unlike the stock market, your data usage history is probably a good indicator of how much data you will use in the future. iPhones have built-in data meters. You can access them by going into Settings — General — Usage and adjust the date ranges to get a snapshot. There are ways to do it on different Android devices as well, and you can always call customer support to find out.
Why is this happening?
Verizon says customers want simplified pricing schemes, but as Ceclia Kang points out in her Washington Post story , the business is shifting toward figuring out how to make money from data.
It’s the data, stupid — consider it a variation of a more famous quote.
An hour of video is uploaded every second to YouTube, and 10 photos a second are uploaded to the photo-sharing app Instagram. Thirty billion apps have been downloaded from Apple. That is a lot of information created and consumed, increasingly by and on mobile devices, and the carriers want to make sure they profit from it.
Take a longer view and see how cellphone companies have switched. For one, they aren’t called cellphone companies anymore.
These companies used to make money with each new land line. As cellphones became more popular, they made money with each new connection. When it became clear that almost everyone had a mobile phone, the companies made cash by charging us more by the number of minutes we used or the number of texts we sent (which were very profitable for the companies).
Voice traffic is slowly migrating off the cellular network through data services such as Skype. Text messaging is facing competition from apps such as What’s App or iChat, meaning people are still exchanging real-time information without paying for minutes or text.
AT&T has already said they are considering a similar plan, so look for this massive shift to continue.