Should angry Verizon subscribers ditch Big Red?

Verizon Wireless subscribers are hopping mad about losing their unlimited data plans. But what are their options, and is there any way to keep those unlimited plans? Ask Maggie offers some advice.

Talk about kicking up a dog doo-doo storm. Verizon's chief financial officer Fran Shammo sure knows how to stir up a frenzy.

Comments the executive made earlier this week ignited a backlash among Verizon Wireless customers. Shammo said in an interview at a JP Morgan investor conference that the company plans to force its existing unlimited data plan customers to move to a tiered offering this summer in an effort to drive more data revenue for the wireless carrier. This is a switch from the company's current policy, which has allowed so-called "grandfathered" users to keep their unlimited data plans if they had those plans before the company switched to a tiered offering last summer.

Verizon's PR team was not quite ready to respond to the flurry of inquiries from journalists about the change in policy, leaving many longtime Verizon customers frustrated and angry. And many of those irate Verizon Wireless customers have written to Ask Maggie.

In this edition of my column, I offer some advice on whether a reader should ditch his unlimited data plan. And I explain how he and others with unlimited can keep them if they want to.

Should I stay or should I go?

Dear Maggie,
I am a longtime Verizon Wireless customer. But I am getting really fed up with the company. I am just tired of them nickel and diming me. First it was the extra charge to pay my bill online, which they reversed. And then it was the $30 upgrade fee for a new phone. And now they are trying to take away my unlimited data. I'm seriously considering dumping them. But which carrier offers a better deal? Do you think it's worth going to another carrier over this?

Thanks,
So mad I could spit

Dear So mad I could spit,

I completely understand your frustration. And I have to admit, it would anger me too if I were a Verizon Wireless customer. (By the way, my fiance, Mark, has had Verizon for years and loves his unlimited data plan. I got an earful from him Wednesday night about all of this.)

Before you go making any rash decisions, take a deep breath. And let's think through your options. First, we don't know yet how Verizon plans to price the new "data-share" data plans, which will be introduced later this summer.

Depending on how much data these plans offer and the price Verizon is charging, you may actually end up saving money on such a plan if there is more than one person in your household sharing the data plan with you, or you have more than one device that you'd like to connect to Verizon's 4G LTE network.

For example, let's say that there are two people in your household with unlimited smartphone data plans. You are each paying $30 a month for data service. That's $60 a month combined. If you each are using an average amount of data per month, you're likely over-paying for your service. Most smartphone users in the U.S. are using less than 1GB of data per month.

Even if you are using more data than that on your unlimited plan today, you could alter your behavior and possibly save money in the process under the new shared plans. Using Wi-Fi when it's available is one way to save on data. And you can also download and use apps like Onavo, which not only compresses the data that your phone is accessing, but can alert you when a particular app is being network hog. You can also set limits and get alerts when you're approaching those limits.

But of course, right now, all these potential cost-savings are only theoretical. We need to see what Verizon plans to charge for the new plans and how much it plans to charge customers for additional lines connected to a single data-share plan.

That said, you do have options. And since this new policy will only go into effect once your current contract ends, you will be able to leave Verizon and go to another carrier. But before you even begin comparing pricing, you need to figure out which other carriers offer service in your area. While some consumers have the option of four or more wireless providers in their area, many have far fewer choices. Ask family, friends and co-workers which providers they use. And if they get decent service, you could consider those carriers as alternative options.

But I'm going to be honest with you. One of the reasons that Verizon has been so bold about these pricing policies is because the company knows it offers a solid service that out-performs its competitors. Verizon has the largest footprint of 4G LTE. The company plans to complete its deployment next year, when it will cover more than its 3G footprint with 4G service.

And Verizon has consistently won high marks for its reliable network. That said, if you're really fed up. Then by all means look around. If enough Verizon customers vote with their feet, Verizon may be forced to take a different attitude.

So which other service providers do I recommend?

When it comes to getting unlimited data, your choices are really limited. AT&T no longer offers unlimited data to new subscribers. So switching to AT&T won't solve your problem.

T-Mobile USA offers a so-called unlimited data plan. But the service isn't really unlimited since usage is slowed once you hit a certain threshold. The good thing about T-Mobile's plans is that they are affordable. And if you do go over your limit, you won't be hit with an additional overage fee. You'll simple see your data speeds slowed until the start of the next billing cycle.

Each of these unlimited packages includes unlimited talk and text. They differ in the amount of data they offer each month as well as whether or not you can use the hotspot feature to attach other devices.

The Unlimited Ultra service with hotspot is available for a limited time for $125 a month and it includes unlimited data usage up to 10 GB per month. And you can connect up to five devices via the Wi-Fi hotspot feature on your smartphone. Plus the company offers 10 GB worth of free photo and video storage on its network, which T-Mobile claims is worth about $20 a month.

The Unlimited Premium service with smartphone mobile hotspots is $95 per month and gives you up to 5 GB of data per month. And it also includes the Wi-Fi hotspots for up to five devices. And it includes the 10 GB of free photo and video storage.

The Unlimited Plus plan offers up to 2GB of data usage per month for $80 a month.

But there are a few things to keep in mind when it comes to T-Mobile. For one, the carrier doesn't offer 4G LTE service yet. That will be coming starting in 2013. That said, the company offers an HSPA+ 42 Mbps network, which is the fastest version of the HSPA+ technology. T-Mobile calls this 4G. The other potential downside is that the carrier doesn't offer the iPhone. So if that's a device you're interested in buying, then you might want to look elsewhere.

Sprint Nextel is the only one of the big four wireless carriers that still offers unlimited data. But just like T-Mobile there are some things to consider. Sprint is only just now deploying its 4G LTE network. It has begun selling Google Android devices supporting 4G LTE, but it hasn't launched the network yet. And initially, the service will only be in a limited number of markets. The other issue is that some Sprint customers also feel nickel and dimed by the carrier. For example, Sprint tacks on an extra $10 a month to its monthly unlimited service plans for all smartphones.

Still, the carrier is the only major wireless provider that offers unlimited data plan. Here's a short breakdown of its unlimited offers, which includes unlimited text messaging.

The Unlimited Data plan comes in two flavors: For $70 a month you can get 450 minutes of voice service with your unlimited data and text messaging. And for $90 a month you can get 900 minutes of voice service with the unlimited data and text.

The Simply Everything plan is $100 a month and includes unlimited voice, text messaging and data.

(Remember that you have to tack on an additional $10 a month for each of these plans if you're using a smarpthone.)

Regional and prepaid carriers may be another option for you.

If you live in a region of the country where a smaller regional service provider operates you may also still be able to get unlimited data. For example, C-Spire a small rural carrier in the Southeast serving Mississippi and parts of Tennessee, Alabama and the Florida Panhandle offers an unlimited voice, text messaging and data service for $70 a month. The company also sells the iPhone 4S for $50 less than the major carriers. You can get a 16GB iPhone 4S for $150 with a two-year contract.

Prepaid providers, such as MetroPCS also offer good deals with so-called unlimited data. MetroPCS offers its 4G LTE service with unlimited data for $70 a month.

Of course, when checking out these services be sure to read the fine print. Often wireless carriers may market a service as unlimited, but they really have restrictions on how much data you can actually use. For example, MetroPCS's terms and conditions say that the company can limit data usage to 1GB per month, which doesn't sound like unlimited usage to me. Also, not all 4G LTE networks are created equal. MetroPCS has generally gotten low marks for its deployment of the technology. And on a prepaid carrier, you will have to pay full retail price for your phone.

The other thing to keep in mind is that even the carriers that are offering unlimited service today may not be able to continue to offer it on an unlimited basis in the future. As usage explodes, carriers simply can't sustain the unlimited model.

"The sad reality is that while it's a great market penetration strategy, unlimited data is simply not a sustainable economic model," Guy Rosen, CEO of Onavo said in an email. "Supply is limited by the laws of physics and demand is simply exploding. Verizon's statement adds to AT&T's throttling debacle of earlier this year, ushering us into a future where all data has a price tag. It's now clear that operators will find any loophole they can to eradicate grandfathered unlimited contracts."

As I mentioned earlier, Onavo has created an app that helps people manage their data usage.

I hope this advice was helpful. And good luck!

How can I keep my Verizon unlimited data plan?

Dear Maggie,
I've been a long time customer of Verizon Wireless with an unlimited data plan for my smartphone.In the past, I've been able to re-sign the same contract and keep my existing terms. That's how I've been able to hold onto my super old contract. Does this new policy mean that I won't be able to do that anymore? I NEED unlimited data. I use about 50GB per month.

Thanks,
Brian

Dear Brian,
I've got some good news for you. You just might be able to have your cake and eat it too. Or in this case, you may be able to get 4G LTE and still keep your unlimited data plan on Verizon Wireless. But there's a catch. If you want to keep that data plan, you'll have to give up the subsidy on your next device when you renew your contract.

A Verizon Wireless spokeswoman contacted me yesterday to clarify Verizon's policy for existing unlimited data plan users when the company introduces its new "share" plans this summer..

First, Verizon will not automatically move anyone off their existing data plans over to the data share plans. For one thing, if you are still under a contract, Verizon has to honor that contract until its completion. But once that contract expires, the company is free to change the terms of the agreement if you choose to sign another contract.

In this case, Verizon says that it will allow customers to keep their existing unlimited data plans if they either continue to keep their existing device or they buy a new device at the full retail cost of the smartphone.

In other words, if you renew your contract and purchase a subsidized phone when your contract expires, you will not have the option to keep your unlimited plan.

"If a 3G or 4G smartphone customer is on an unlimited plan now and they do not want to change their plan, they will not have to do so," Verizon's spokeswoman wrote to me in an email. "(But) when we introduce our new shared data plans, Unlimited Data will no longer be available to customers when purchasing handsets at discounted pricing, i.e. Signing new contracts."

She also clarified that the same pricing and policies, once they're announced this summer, will apply to all 3G and 4G LTE smartphones. So this means that regardless of whether you sign a contract for a 3G device or a 4G LTE smartphone, you will still have to give up the unlimited data plan if you buy a subsidized device. It also means that if you already own a 4G LTE phone and have been using the unlimited data plan, you can keep that phone and keep your unlimited data plan.

In short, what this means is that customers, such as yourself, who must keep the unlimited data plan can do so. But it will still cost you. If you want a new smartphone, you'll have to pay for it yourself without Verizon's subsidy. It also likely means that you won't be able to attach other Internet connected devices to your service. And you won't be able to take advantage of the data-share plan to share data among other subscribers on your account.

I hope this helps clarify things a bit for you. I'll be following this story closely, and I'll be sure to share any other updates I receive from Verizon.

Ask Maggie is an advice column that answers readers' wireless and broadband questions. The column now appears twice a week on CNET offering readers a double dosage of Ask Maggie's advice. If you have a question, I'd love to hear from you. Please send me an e-mail at maggie dot reardon at cbs dot com. And please put "Ask Maggie" in the subject header. You can also follow me on Facebook on my Ask Maggie page.

 

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