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Verizon talks about the iPhone 5 and the switch to usage-based data pricing

Posted: , by Ken N.

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Verizon talks about the iPhone 5 and the switch to usage-based data pricing
With the average wireless customer consuming more data than ever before, carriers have been moving away from their unlimited pricing models. And Verizon is no different. While they extended their $30 unlimited data plan to new Verizon iPhone customers, they admitted that they would switch to a usage-based model eventually.

In an investor conference webcast, Verizon CFO Fran Shammo discussed a change in mobile data pricing, as well as the possibility of an impending iPhone refresh. Regarding the change to usage-based data pricing, Shammo said that they "will probably do that in the mid-summer time frame." The announcement of data pricing was meant to encourage investors, as Shammo explained that it would help their financial outlook.

Surprisingly, investors were less than thrilled to hear that there may be an iPhone 5 on the horizon. In fact, Verizon shares dropped a full 2.4% after Shammo explained that "If there happens to be a new one that comes out, that quarter might not look so good either."

While Shammo didn't offer any time frame for the next iPhone, Apple's traditional release date for iPhones is during the summer. That could prove devastating to Verizon customers who find their nearly-new iPhone 4s getting quickly overshadowed. Credit Suisse analyst Jonathan Chaplin says that Verizon doesn't want to "be put in a position where it's forced to offer free trade-ins...There's some risk of that."

All we can say is that if the iPhone 5 does come to Verizon as early as summer, it had better include an LTE radio and NFC support.

source: Reuters

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posted on 01 Mar 2011, 21:07 2

1. Droid_X_Doug (Posts: 5993; Member since: 22 Dec 2010)

"All we an say is that if the iPhone 5 does come to Verizon as early as summer, it had better include an LTE radio and NFC support."

Or, VZW will be compelled to offer some sort of rebate/trade-in program. Which was why the stock dropped 2.4%.... Because investors don't buy the LTE radio and NFC support argument. The iPhone 5 is going to be an incremental refresh to keep up with the competition and remedy the antenna issue.

posted on 01 Mar 2011, 22:09

4. iwebdroidberry7 (Posts: 230; Member since: 17 Jan 2011)

No. You only WANT it to be an incremental refresh. Give me any type of proof stating that? Apple's not stupid they know they have competition and they know an incremental update isn't going to get them through the year. The did the 3G & 3GS update probably because their was hardly any competition at all back then.

posted on 01 Mar 2011, 22:27 1

5. BaiGanyo (Posts: 308; Member since: 07 Feb 2011)

Antenna issue? What antenna issue [sic]? if there was an antenna issue, everyone would have come en masse and returned it. You're just a hater. Troll. Fandoird. Go away. Leave apple alone. lol.......

posted on 02 Mar 2011, 00:05 1

10. Leyjee (Posts: 47; Member since: 25 Feb 2011)

jeez BaiGanyo.. take it easy I think your the troll here, posting a negative comment in about almost every post...

posted on 02 Mar 2011, 01:01

13. BaiGanyo (Posts: 308; Member since: 07 Feb 2011)


posted on 01 Mar 2011, 21:08 1

2. JeffdaBeat (unregistered)

Tiered data is just something we are going to have to get used to. Next it will be out PC's at home...just gonna be a way of life. Although I'd rather it be tiered or throttled than killing net neutrality.

What I don't understand is the comment about the new iPhone. Why would it hurt business, especially if it is supposedly going to both AT&T and Verizon? Maybe AT&T will get the new iPhone in the summer followed by Verizon in the Winter? Just seems like an odd thing to say...

posted on 01 Mar 2011, 21:24 2

3. Droid_X_Doug (Posts: 5993; Member since: 22 Dec 2010)

I am only responding to the article, but if the VZW CFO is warning investors, that means they have done some research and think they are going to take a hit. The investors then drop the share price by 2.4%. I was expecting bragging about how many iPhone 4 customers VZW had picked up.... Kind of quite on that front. I wonder why the silence?

posted on 02 Mar 2011, 00:48 1

12. taco50 (banned) (Posts: 5506; Member since: 08 Oct 2009)

There was an interview with Dan Mead in the Wall Street Journal. He said the iPhone is the best selling phone on Verizon ever and VZW is very happy with the sales results which will be announced with the Q1 results. Talk about a fan boy. You named yourself after a phone.

posted on 03 Mar 2011, 00:48

26. chorr1001 (Posts: 26; Member since: 02 Mar 2011)

Its more or less due to the fact that if, and it's big if, Verizon goes the way of AT&T and lets current iPhone4 users upgrade all willy nilly and what not, they most likely won't be able to cover the massive subsidy pricing that comes with each and every iPhone4 that they purchased. Not to mention depreciation in what remaining stock of iPhone4's they have left at launch of the 5.

posted on 01 Mar 2011, 23:54 4

9. deezy (Posts: 46; Member since: 10 Feb 2011)

I usually don't agree a lot of what you have to say but I 100% agree with you here. Most users don't use over 2G of data and that'd be around $20/month on Verizon...(I don't know about iPhone usage because isn't it true they use more data with more frequent pushing??? correct me if I'm wrong)
Also, when the "BIG" announcement of the VeriPhone came out, both Verizon and Apple stocks dropped...doesn't make much sense if you ask me. I'm no brokerage genius but typically with any big announcement sparks interest in that stock. With more purchases, the stock increases...right?

Consensus: I blame Steve Jobs for all of this. He's making me wait for the Thunderbolt, probably for the Bionic, and making Verizon go to tiered data. lol On a plus side, though, he is helping us win this inevitably approaching war on China by slowly poisoning each and every one of them...for that, Steve Jobs, ye shall be knighted...

***end smartass rant***

posted on 02 Mar 2011, 00:33 3

11. visitor (unregistered)

The stock takes a hit because of the heavily subsidized price of the Iphone. Verizon loses money in the short term, but makes up for it over the long term. Some investors only care about the short term trade so they sell the stock.

posted on 02 Mar 2011, 18:15

22. deezy (Posts: 46; Member since: 10 Feb 2011)

I thumb'd this up...who'd thumb it down? Some people's kids...jeez
Thanks for the insight

posted on 01 Mar 2011, 22:47 1

6. Jdog8282 (unregistered)

I am also wondering why they would "take a hit" with the iPhone 5 when it gets released this summer. If someone could provide some clarification on this it would be greatly appreciated.

posted on 02 Mar 2011, 01:03 1

14. BaiGanyo (Posts: 308; Member since: 07 Feb 2011)

You seriously can't figure it out?

posted on 01 Mar 2011, 23:09

7. luis_lopez_351 (Posts: 951; Member since: 18 Nov 2010)

thumbs down xD

posted on 01 Mar 2011, 23:47 3

8. Uzzelien (Posts: 131; Member since: 22 Feb 2011)

Doesn't it seem like a bad thing to do to get new customers to change to that when you're talking and showing off VoLTE? This just seems like a way for Verizon to get money for no additional service.

posted on 02 Mar 2011, 01:33 7

15. testman22 (Posts: 339; Member since: 03 Nov 2009)

I don't get what it is about iphone users that makes them feel entitled to a discounted phone every time apple upgrades. I didn't see people with droid 1s crying when the droid 2 came out. If the iphone 4 didn't have enough features and specs for you, then DON"T BUY IT

posted on 02 Mar 2011, 02:11 4

16. BaiGanyo (Posts: 308; Member since: 07 Feb 2011)

They spend all this time hyping up how great it is only to wanna get rid of as soon as possible. Tells you what kind of people they are.

posted on 02 Mar 2011, 07:09 3

19. ibap (Posts: 785; Member since: 09 Sep 2009)

Exactly. But Apple keeps telling everybody how 'special' they are - until the next device comes out.

posted on 02 Mar 2011, 04:15

17. nimo (Posts: 72; Member since: 11 Jun 2010)

"All we can say is that if the iPhone 5 does come to Verizon as early as summer, it had better include an LTE radio and NFC support."

Yes because both of those are wildly used and supported worldwide at the moment, how would we manage without them.....not.

posted on 02 Mar 2011, 05:03 1

18. Windsponge (Posts: 92; Member since: 01 Nov 2009)

I have Verizon and I bought I phone 4, I have had all the Droids that were on Verizon. I could care less about I phone 5. This is the first phone that works great for me. It gets better reception than any of the Droids or the Samsung S I have. Gave S to my wife and have X put away that I will not use again. This site says a lot of things that for me make no sense. That being said you are the judge of what you like. As for data usage it is because people use their Iphone more. I have less data with Iphone than Droids. Just be happy with what you like don't be so hard on each other. Life is way to short to worry about petty choices.

posted on 02 Mar 2011, 18:21 1

23. deezy (Posts: 46; Member since: 10 Feb 2011)

you're full of shit or naive...or both...you've had ALL of the Droids? Maybe it was user errors??? The iphone IS a good phone but it's like I tell all of my customers, would you buy from a company that intentionally holds out features so they can release another generation 6 months later? Look at the ipad 2 and soon to be iphone 5...they're just incremental steps to the real upgrades...the ipad 3 and iphone 6...

posted on 02 Mar 2011, 08:20 1

20. jbash (Posts: 345; Member since: 07 Feb 2011)

its amazing how every apple conversation sparks a cellphone comment war....smh

posted on 02 Mar 2011, 10:42 1

21. chorr1001 (Posts: 26; Member since: 02 Mar 2011)

I wouldn't look for Verizon to do any free trade-in or early upgrade program. They have already pulled New Every Two credits and annual upgrade programs. The reason that AT&T did the early upgrade promo was simply because the contractual agreement between Apple and AT&T required that 40% of phones sold by AT&T had to be iPhone to maintain exclusivity. People know the drill. A new iPhone has come out every summer like clockwork for 3 years now. It was their choice to wait to see what the iPhone5 has to offer, or pull the metaphorical trigger and choose the 4. I might be wrong though.

posted on 02 Mar 2011, 20:07

24. Applesauce (unregistered)

I've heard that AT&T is getting the iphone 5 first, around June/July, and will be exclusive to them for the first few months, then verizon gets it, so it's not a shot in the foot relative to the verizon iphone, then in 2012 both carriers get the 2012 model simultaneously, though by then it may/should be available and subsidized on other U.S. carriers.

posted on 03 Mar 2011, 00:59

27. chorr1001 (Posts: 26; Member since: 02 Mar 2011)

Negative ghost rider. AT&T will get exclusivity on the iPhone again right around the time Steve Jobs accepts flash. Apple was very eager to get out of that exclusive contract. The network issues iPhone users had on AT&T, though not entirely Apple's fault, didn't do anything to help Apple. Besides, with Apples market share dwindling to Android last year, and the fact that they will be last to the table with a 4G handset(if 5 is 4G) they'll want that phone as widely available as possible no matter who the carrier is.

posted on 02 Mar 2011, 20:17

25. That VZW Guy (unregistered)

iPhone in general actually tend to use considerably LESS data than droid users as a matter of fact. This does not mean that iPhone users use their phones or the applications and thei nternet any less however. The BIGGEST reason is that on iPhone, many things work on WiFi ONLY - or WiFi and 3G - whereas on the droids, several of these features work ONLY on 3G. Therefore, iPhone users typically spend more time connected via WiFi than a typical Droid user. That is not to say that is the case for everyone, but it is an average basis.

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