Unlimited forever! Data junkies look to hang on to their plans

Wireless customers with "grandfathered" unlimited-data plans will do almost anything to hold on to them.

It's been five years for AT&T and four years for Verizon since either wireless carrier sold an unlimited data plan. But these operators have allowed customers who previously signed up for those plans to keep them.

But neither carrier really wants customers to stick with unlimited. They have crafted policies to encourage those customers to switch to their usage-based plans, which charge customers a flat fee for a predetermined amount of data each month.

Verizon has adopted the strictest policies, which includes not allowing customers with unlimited data plans to take advantage of device subsidies when renewing a service contract. Meanwhile, AT&T has aggressively slowed down network access for unlimited data customers if they hit certain limits. These policies, which have changed several times over the past few years, have confused customers.

In this edition of Ask Maggie, I help a Verizon subscriber and an AT&T subscriber figure out how or even if it's possible to jump through hoops to keep their unlimited data plans.

The slow fizzle of Verizon's unlimited data plan

Dear Maggie,

I have a four-line account with Verizon. Two of them are still getting unlimited data for $30 a month, and two are on the regular share plans.

I went to Verizon this weekend to upgrade my iPhone 5. I have one of the unlimited lines. In the past when I wanted a new phone for my unlimited line, I'd wait until one of the lines that didn't have the unlimited plan was due for an upgrade. Then I would buy a new phone with that upgrade and transfer the device to the number on one of my unlimited data accounts.

When I went to do that this time around, I had a feeling that Verizon had made another policy change to prevent this. I went to a Verizon store and asked a representative if making this swap would affect my unlimited plan. He did some checking and told me the device upgrade cannot be transferred to a device on an unlimited plan.

Needless to say, I was shocked and did not buy the phone. I know you might say I don't really need the unlimited data plan. But I am a truck driver and I'm on the road a lot and use my smartphone constantly. My average data usage is 11 gigabytes a month, and last month I reached a new high of 13 GB. If I switched to Verizon's new plan, I'd pay more than $120 a month just for my phone.

I am wondering if you can think of any way I can keep my unlimited data plan without paying full price for a new device?

Thanks,

Unlimited Data Forever

Dear Unlimited Data Forever,

For the past few years, Verizon has been making it more difficult for customers to keep its old $30 a month unlimited data plan. The company officially stopped offering that plan in 2011. That's when it introduced its new tiered service offering that gave customers a set amount of data they could use each month for different price points. If customers exceed these caps, they're charged extra for the overages.

Initially, Verizon allowed customers to keep their unlimited data plans even after their contracts had expired. But in 2012, the company began tightening the requirements for keeping those plans in an effort to encourage customers to switch. The policy change required any customer who wanted to keep his old unlimited data plan to forgo a device upgrade when his contract expired. This meant that if a customer wanted to keep the unlimited data plan and he wanted a new phone, he had to buy a new device at full price. So long as he didn't take the upgrade and renew his contract, he was able to keep the $30 a month unlimited data plan.

The policy change resulted in most of Verizon's grandfathered unlimited customers giving up their old plans and signing up for the new tiered offerings, which allow customers to share a set amount of data among several subscribers or multiple devices. But there are people, such as yourself, who have been unwilling to give up the unlimited data. As you highlight in your question, there have been several clever ways to get around the no-new-device-upgrade-policy for unlimited plan customers.

I checked with a Verizon spokesman to make sure the information you were given by the store sales representative was correct. She confirmed that late last year Verizon once again tightened its policies to prevent the upgrade swapping that you described.

So what can you do now to keep your unlimited plan and still take advantage of device upgrades?

It's actually pretty simple. Verizon customers no longer need to ask a representative to provision a device for their account. All its 4G LTE devices come equipped with SIM cards, which can be swapped in and out to change service. This means that you could upgrade one of the lines that is under contract on Verizon's tiered offering to a new phone, pop out the SIM card from the new device, and replace it with a SIM card from the device that is linked to your unlimited account. And voila, your new phone will then use the same phone number associated with the unlimited service. The Verizon representative confirmed that doing this would allow you to swap accounts, but she emphasized that the company does not encourage customers to do this.

"We want to be able to provide good customer service," she said in an email. "And that's not always possible if things are switched around."

The bottom line:

Verizon doesn't want its customers to hold onto the old unlimited data plans. The company has made that crystal clear. Last year, it tried to extend its "network optimization" policy to unlimited data customers on its 4G network. This policy would "throttle" or slow down service for customers who used too much data during times of network congestion. The company has applied the policy to customers on its 3G network.

But the Federal Communications Commission took issue with this new policy. Chairman Tom Wheeler went so far as to call it "disturbing." Amid pressure from regulators, the company eventually backed off from extending the policy to its 4G unlimited data subscribers.

All of this is to say that it's likely Verizon will continue to tweak its policies to crack down on customers who don't follow its unlimited data policy to the letter. And it will do all it can to convert those customers.

That said, there is an easy way to circumvent the policy today by swapping the SIM cards yourself. But keep in mind that eventually all wireless subscribers will likely be paying full price for new smartphones regardless of the type of plan they are subscribed to. Verizon and other large wireless operators have been adjusting their service plans over the past year, and it's conceivable they will eventually eliminate all device subsidies. For instance, Verizon's Edge plan, which requires customers pay off the full retail price of their devices, offers customers who buy their own device a discount on their monthly service. My guess is that it won't be long before the old contract plans that offer a new smartphone for $200 in exchange for signing a two-year commitment go the way of the dinosaur -- or in this case, the way of the old unlimited data plans.

Holding on to AT&T's unlimited data plan

Dear Maggie,

I need your advice. I have subscribed to an AT&T "grandfathered" unlimited data plan for a number of years. I have an older iPhone 4S. It is definitely time for a new phone, and I have more than fulfilled my contract. Do I have to pay full price for a new device to keep my unlimited data plan?

Thanks,

Andy

Dear Andy,

The short answer is no. AT&T does not impose any restriction on upgrading your device every two years if you want to keep your unlimited plan. This means you can renew your two-year contract and get a subsidy on your new smartphone and still keep your unlimited data plan. This is in contrast to Verizon customers, who are unable to keep the unlimited data plan if they take a subsidy on a new phone (See above).

This is likely why about 44 percent of AT&T customers still have one of these unlimited data plans in spite of the fact that AT&T hasn't offered such a plan to new customers since 2010, according to a report last year from the market research firm, Consumer Intelligence Research Partners.

The company doesn't seem to have any plans to force customers to drop those plans either. Even though it is slowly getting rid of the contract subsidy plans and is instead encouraging customers to pay for their devices in installments as part of its Next Plan, customers can still keep their unlimited data plans.

But this doesn't mean that AT&T really wants its customers using data unfettered. The company has long had a policy in which it throttles or slows down service for unlimited data customers if the person consumes an excessive amount. The policy on how and when this throttling occurs has changed over the years. But it has been controversial. Last fall, the Federal Trade Commission sued AT&T alleging it had slowed the service of some unlimited plan customers by up to 95 percent, essentially making it impossible for these customers to complete even routine tasks like browsing the Web or using GPS navigation. In some urban areas, like New York and San Francisco, customers were supposedly seeing services slowed for using as little as 2GB of data.

What this means is unlimited customers who are heavy data users aren't likely getting full access to the network, while customers who still subscribe to unlimited but don't see their service being slowed probably don't need the unlimited data anyway. The reality is that most customers don't use more than 2GB of data per month. If that describes your usage, you don't really needed the unlimited plan and probably won't pay much more if you sign up for one of AT&T's new plans. If you are using 3GB, 4GB or more of data per month on an unlimited data plan, your service could be significantly slowed to the point where it's unusable. If that happens, what's the point of having access to more data if you can't use it?

The bottom line:

You can certainly keep your unlimited data plan on AT&T if you want, but it may not necessarily be the best deal for you. If your service is slowed down often because AT&T thinks you're using too much, or you don't use more than a gigabyte of data per month, you might be better off with an AT&T Mobile Share plan.