Despite fears of a new and devastating price war caused by unlimited calling plans, the opposite seems to be occurring.
Quite to the contrary, the new plans seem to be encouraging users to trade up, and add more-capacious data plans as well, at least at Verizon Wireless.
"In the first quarter our unlimited plan accounted for 13 percent of our single line retail post-paid adds, says Denny Strigl, Verizon Communications COO. "That compares to about four percent choosing the $99 or above tiers before the plan was launched." Lots more users seem to be trading up to the more-expensive plans, in other words.
"We’re seeing good growth in high tier voice plans," says Strighl. There are churn benefits, which was the impetus for the plan. What might have been unforeseen is the increase in usage of data services and aggregate growth of customers moving up to the $90 plan from lower-revenue plans.
"Additionally, a high percentage of the new customers who choose an unlimited plan also choose our select or premium data packages," says Strigl.
"In March, which was the first full month after the launch, our average daily disconnects declined six percent from previous months and that is at the voice access tier $79 and above," says Strigl.
It appears that there are more users willing to trade up than there are heavy users finding they can save money by trading down, in other words.
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