Last year when Verizon (NYSE:VZ) introduced its shared data plans, it made them the only option for new customers. Big Red's Share Everything plans cost significantly more for individual users. AT&T (NYSE:T) unveiled its own shared data plans shortly thereafter but highlighted that it wasn't forcing new customers into anything and they could still pick from their legacy plans. Those days are gone, as AT&T has announced that starting later this month, all new customers will have to pick a Mobile Share plan, which again translates into higher prices for individuals.
That could also be an opportunity for smaller rivals such as T-Mobile (NASDAQ:TMUS) and Sprint if they resist the temptation to force customers into overpaying for talk and text. T-Mobile has gained momentum this year thanks to transparent pricing and affordable options -- which now appear even more affordable considering AT&T's and Verizon's effective price increases.
AT&T has undoubtedly taken note of Verizon's performance of late, since Big Red has grown its average revenue per account as well as postpaid wireless subscribers over the past year. Those are two incredibly important metrics for wireless carriers, and AT&T wants to see similar upside in its own business.
In this segment of Tech Teardown, Erin Kennedy discusses AT&T's move with Evan Niu, CFA.
Erin Kennedy owns shares of Apple. Evan Niu, CFA, owns shares of Apple and Verizon Communications. The Motley Fool recommends and owns shares of Apple, Facebook, and Google. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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