Verizon's Unlimited Data Offering Runs Up Against Limits For Business Customers

Verizon jumped back into the unlimited data ring over the weekend with a new plan, its first since discontinuing a similar offering in 2011.

Verizon's latest data plan -- Verizon Unlimited -- offers unlimited data for $80 monthly for a single line and four lines of unlimited data for $180 monthly. The move comes on the heels of rivals Sprint and T-Mobile last month revealing competitively priced unlimited data plans for their customers.

Basking Ridge, N.J.-based Verizon needed to respond to the recent moves from Sprint and T-Mobile, said Rob Chamberlin, co-founder and chief revenue officer of DataXoom, a Walnut Creek, Calif.-based solution provider and wireless carrier partner that specializes in mobility services.

[Related: Verizon Restructures Small Business Segment, Launches Verizon Business Markets]

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"I believe both T-Mobile and Sprint have some fairly good momentum in the market based on both aggressive service pricing and their own 'unlimited' data offerings," he said. "I do believe that Verizon had to make this move to stem any further gains by these more aggressive competitors."

T-Mobile, the wireless carrier that has led the charge in so-called un-carrier moves and unlimited data plan offerings, reported in its fourth-quarter 2016 financials that it had 933,000 branded postpaid net additions in the quarter, which was higher than fourth-quarter 2015's 917,000. By comparison, Verizon had 591,000 postpaid net additions during 2016's fourth quarter.

Bellevue, Wash.-based T-Mobile is currently selling unlimited data for $70 for one line including taxes and fees, $10 less expensive than Verizon's unlimited plan before taxes and fees.

"It's been obvious that T-Mobile is spearheading these newer plans and offers, just like they were the first carrier to do away with the two-year contract. The carriers have been following in T-Mobile's footsteps, so the momentum is not really with the two big players -- Verizon and AT&T," said Robert Mendoza, technical help-desk manager for TeraNova Consulting Group, a telecom expense management provider for wireless offerings that partners with the four major wireless providers in the U.S.

While the new unlimited plans are creating a stir in the consumer space, the impact these plans will have in the business space are likely to be minimal for now. Consumers make up the largest segment of most telecoms' customer base, so while offerings are often launched for consumers first, these deals eventually bleed into the business segment.

A spokesperson for Verizon told CRN that Verizon Unlimited is currently available for small-business customers up to 50 lines.

Aside from very small customers, unlimited plans would unlikely meet the needs of larger business customers, DataXoom's Chamberlin said. "Most midmarket and enterprise clients don't really believe in unlimited or 'free,' and will be better served by current Verizon rate plans that offer mobile data pooling across a large number of wireless devices," he said.

DataXoom will continue to offer mobile data pooling plans to its business customers, which gives these customers high-speed connectivity at the lowest overall cost, he added.

San Diego-based TeraNova also will continue to offer Verizon's Flexible Business Plan or More Everything plan to its business customers to keep billing as simplified as possible, Mendoza said.

"These plans usually meet our customers’ needs. The only time an unlimited plan is something we would recommend is if a small client is using more than 10 Gigs per line of data," he said.

Customers should also be leery of any carrier’s definition of "unlimited," Mendoza said. Most carriers' unlimited plans do include a data cap that when reached drops users from 4G LTE network speeds to 3G speeds.

For its part, Verizon said that data speeds could be slowed for users on congested cell towers if they have consumed more than 22 GB of data in a single month. The carrier added that the majority of its customers don’t go over more than 5 GB of data per month.

After Verizon's weekend announcement T-Mobile Monday fixed the flaw it had in its unlimited plan. As of Feb. 17, the T-Mobile One unlimited plan will stream video at HD-resolution by default. The carrier's One plan today caps all video over mobile data at a 480p -- less than HD quality -- unless subscribers pay $15 for a ’One Plus’ add-on.

Sprint is touting the least expensive unlimited plan of all the carriers. The Overland Park, Kan.- based carrier is running a promotion until March 31 for $50 per month for one line, $40 for a second line, and no cost for third and fourth lines. After that, users that sign up for Sprint's unlimited plan will pay $60 a month for the first line, $40 for the second, and $30 each for the third and fourth lines.

AT&T last year started offering unlimited data plans to consumers who sign up for its DirecTV satellite service, but the Dallas-based carrier will also have to respond to the market by extending this offering to more of its customer base, including business customers, DataXoom's Chamberlin said.

Verizon so far is the only carrier to extend its unlimited plan to business customers, he said.

"Most businesses don't have significant enough overages to justify moving to this new unlimited plan, but for some small businesses that have high data usage, this is something they could consider."