Verizon Wakes Up

Smartphones are turning the telecom industry upside down. Industry giants might as well follow suit.

On Tuesday, Verizon (NYSE: VZ  ) finally realized that its customers care more about high-speed data plans than they do about SMS texting or voice minutes. Starting June 28, new Verizon customers must choose among the all-new "Share Everything" plans. As the name implies, these options can share a set amount of mobile data access among up to 10 smartphones, tablets, and other gadgets. They all come with unlimited voice minutes and text messaging.

"Share Everything Plans represent a tremendous shift in how customers think about wireless service," says Tami Erwin, Verizon's chief marketing officer. Or rather, it represents a shift in how much Verizon listens to its customers -- voice calls and text messages are easily replaced by smartphone apps like Skype or iMessage these days, and traditional phone services don't even have an answer for the video calls we do on FaceTime or, again, Skype.

So minutes and texts have changed from revenue-driving items of value to freebie giveaways. Verizon may be first out of the gate, but AT&T (NYSE: T  ) and Sprint Nextel (NYSE: S  ) can't be far behind. In particular, Sprint has long championed unlimited calling and texting; adding shared data plans would simply be the next logical step for the third-largest network.

Not that Verizon is sacrificing sales or anything. The cheapest possible smartphone plan jumps up from $70 a month to $90, though you'd also gain unlimited talk time in that shift. Data plans already represent the bulk of Verizon's mobile growth, and now Big Red is going whole hog on that big-margin strategy. In the timeless words of Metallica: "Nothing else matters."

It's a brave new world of mobile computing, and hardly worth breaking out those pesky voice plans anymore. Read all about this exploding trillion-dollar market and the surprising stock that's your best bet on the smartphone revolution today. But grab your copy of that special report right now because it won't be free forever.

Fool contributor Anders Bylund holds no position in any of the companies mentioned. Check out Anders' holdings and bio, or follow him on Twitter and Google+. The Motley Fool has a disclosure policy.

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Read/Post Comments (4) | Recommend This Article (3)

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  • Report this Comment On June 13, 2012, at 10:10 AM, DanCooper76 wrote:

    Depending on your perspective, Verizon will be "waking up" soon in regards to its unionized workers - who are still working under no contract. As Wisconsin has shown, it's a brave new world.

  • Report this Comment On June 13, 2012, at 12:56 PM, Haise wrote:

    AT&T isn't far behind. Sprint is very far behind. They aren't so much "championing" unlimited data as recognizing that consumers aren't willing to pay up for their inferior network.

  • Report this Comment On June 13, 2012, at 9:12 PM, conradsands wrote:

    For the post-paid customer, the fact remains that Sprint is the only U.S. carrier to offer them the iPhone experience with unlimited data plans starting at $79.99 per month. Plus, Verizon now charges its customers $30 to upgrade to a new phone when they renew. AT&T charges $36. But Sprint only charges $18. An investment writer recently summed it up best: “Sprint offers the best value proposition for a new smartphone user. I got my first smartphone on Sprint because a new AT&T or Verizon data plan is outrageous. My Sprint plan includes 450 afternoon mobile-to-landline minutes, unlimited other minutes, and unlimited texting and data for $79.99. Unlimited AT&T or Verizon plans would approach $150, and to get a comparably-priced package, I'd have to settle on limited data or texting plans, which I'd have to constantly try to not blow through. Why get a smartphone if you can't have fun using it?” Sprint also placed first in the industry in customer satisfaction, according to results from the 2011 and 2012 American Customer Satisfaction Index.

  • Report this Comment On June 13, 2012, at 9:13 PM, LowellUkulele wrote:

    Maybe consumers are finally noticing that AT&T and Verizon = The Most Expensive Wireless Plans in America. We know where Verizon and AT&T (both in the top 5 for corporate lobbying) get all that money to run commercials 24x7, pay out huge “fat cat” executive bonuses and hire armies of lawyers and lobbyists to try to push the U.S. market into a wireless industry duopoly -- the American consumer. This is how AT&T and Verizon fashion themselves as brilliant … with their political use of money.

    According to the report “Corporate Taxpayers & Corporate Tax Dodgers 2008-10,” two of the 25 companies with the largest total tax subsidies were AT&T at #2 ($14.5 billion) and Verizon at #3 ($12.3 billion). Also, there were 30 corporations that paid less than nothing in aggregate federal income taxes over the same period. These 30 companies, whose pretax U.S. profits totaled $160 billion over the three years, included Verizon. The report states the laws that allow this were not enacted in a vacuum, but rather were adopted in response to relentless corporate lobbying, threats and campaign support.

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