In January on an earnings call Verizon’s finance chief Matthew Ellis said unlimited mobile data plans were “not something we feel the need to do.” At the time Verizon and AT&T both choose not to match T-Mobile and Sprint. The strategy, based on the idea that it wasn’t worth the risk of switching to an unreliable network, worked until it stopped working. Verizon’s subscriber growth was sliced in half from 4.5 million in 2015 to 2.3 million customers in 2016.
The first break came when AT&T selectively began to offer unlimited data plans to its DirecTV and U-Verse cable customers. After watching on the sidelines as AT&T signed 8 million customers, Verizon responded in February with new unlimited mobile data plans for consumers and enterprises. Now AT&T has responded by dropping its DirecTV and U-Verse video subscription requirement. It is also seeking to cross-sell its wireless and pay TV offerings with a offering a $25 credit toward a subscription to DirecTV satellite service, U-Verse cable, or the company’s new Internet-based DirecTV Now streaming video plan.
How do the plans compare?
- For now, AT&T’s Unlimited Plus plan is the most expensive with a $90 charge for one line and $185 for four lines. It includes unlimited talk, text, and data at up to 4G LTE speeds. Video can be streamed in HD quality, but Stream Saver mode, which reduces streaming video to around 480p quality, is enabled by default and must be turned off through myAT&T.
- AT&T Unlimited Plus includes up to 10GB of 4G LTE tethering per line per month, with speeds reduced to a max 128 Kbps for the rest of the bill cycle for eligible devices once the high-speed allotment is exceeded.
- Two smartphone lines starts at $145 per month, while up to eight additional devices, such as tablets and hotspots, can be added for $20 per month each. The pricing includes monthly access charges, but it is not inclusive of taxes or additional fees. AutoPay and paperless billing are required.Verizon’s plan starts at $80 for one line and goes up to $180 for four lines. The plan also allows up to 10 subscribers (enterprises or families) into pools with a $100 charge and a $20 access fee per line for unlimited data.
- T-Mobile’s unlimited plan starts at $70 and goes up to $160 for four lines. Last month, T-Mobile also stopped adding surcharges and taxes as additional fees, effectively cutting its unlimited price by another 10% or more.
- Sprint’s unlimited plan starts at $60 per line and goes up to $150 for four lines. It also has an offer of 5 lines for only $90 per month for the first 12 months.
Unlimited mobile data plans and enterprise mobility
Unlimited plans are easier to manage, but they may not be necessary for most employees. Verizon reports that two-thirds of its customers do not use more than 5 gigabytes of mobile data a month. Determining the best deal requires managers to compare their current costs with the costs of an unlimited data plan. Enterprises may find that their current data pools are less expensive when they are combined with a mobile policy and reporting that limits wasteful consumption.
While an unlimited data plan may seem like a good deal because managers don’t need to worry about employees consuming too much data, the costs for these new unlimited plans may exceed the benefits.
There are also some other important considerations. First, enterprises should evaluate their future plans for mobile apps. Second, there may be opportunities for enterprises with significant purchasing volume for mobile data to negotiate better deals than what carriers are offering publicly.
These new programs are a welcome sign that the mobile market is more competitive. Determining the best deal requires some calculations; it will vary among different employees. Ultimately, mobile TEM programs can provide the reports and optimization studies to determine the most cost efficient decision.