Verizon Wireless Gets Rid Of Service Contracts, Phone Subsidies

It appears that the largest wireless carrier in the United States is trying to change how its subscribers should pay for their wireless service. Verizon Wireless recently unveiled a set of new data plans that will have its subscribers pay for their handset in regular monthly installments, or purchase it right there and then. These new plans will become live on August 13th of this year.

It certainly is a departure from what Verizon Wireless normally does, and it kind of represents a slow and sure shift in the wireless industry, especially in terms of subsidies for handsets and service contracts. More and more subscribers nowadays are paying for their smartphones in exchange for less expensive fees. This was actually begun by T-Mobile a couple of years ago, and now, mobile users are becoming increasingly conscious of how much they are spending for their handsets and wireless service subscription.

With Verizon’s new system, gone are the single line options or family plans. Instead, the Big Red will now turn its attention in offering just four options, each with their own data allotments, plus unlimited voice calls and unlimited text messaging. The small bucket will offer 1 gigabyte of data at $30 per month, while the medium bucket will offer 3 gigabytes of data at $45 per month. As for the large bucket, it will offer 6 gigabytes of data at $60 per month. The extra large bucket will get you 12 gigabytes of data at $80 per month. Similar to Verizon’s previous plans, the data can be shared among handsets and accounts.

Because there are no more service contracts, subscribers will be able to switch between different plans every month. Also, apart from the fees for the data, Verizon Wireless will be charging an access fee to connect the handset. Subscribers can expect to pay $20 per month to connect a smartphone, $10 to connect a tablet or Jetpack portable Wi-Fi hotspot, and $5 for connected devices such as a smartwatch.

Verizon Wireless believes that it is making things easier for subscribers by removing service contracts. Also, the carrier says that focusing on just four options helps simplify the process of deciding which wireless service to get. But for some users, having only four options may turn off certain users, especially those with heavy data usage on a monthly basis. For instance, it would be strange the wireless carrier’s biggest shared data plan maxes out at 12 gigabytes, leaving heavy users wondering if they would be slapped with high overage fees if they decide to switch to these.

It remains to be seen if Verizon’s latest move will pay off. We will all just have to wait and see if this would become a new trend in the industry, or just a passing fad. 

You can explore more Verizon deals by comparing plans and phones from the Big Red at Wirefly now.