Verizon would consider eliminating contracts, but not unless consumers demanded it

By , Apr 5, 2013

T-Mobile (Uncarrier 001)

As T-Mobile this morning started accepting pre-orders for the iPhone 5, its ‘Uncarrier’ initiative is about to be put to the real test. Will consumer prefer paying $20 in monthly installments for their iPhone 5 (with $99 downpayment) in exchange for a more affordable and simpler wireless service plan?

Or, would they rather continue dropping a hundred bucks or more each month for their overpriced wireless service, with no easy way to cancel their long-term commitment without incurring hefty penalties and hidden fees?

We should know in the coming days and weeks as the Deutsche Telekom-owned telco starts selling the popular smartphone beginning next Friday, April 12.

When T-Mobile announced earlier this year it would kill subsidies and offer Apple’s handset on monthly installments, cowardly AT&T and Verizon employed waiting tactics, opting to instead sit on the sidelines and monitor how the situation unfolds rather than improve their own dealings with customers.

When asked to comment on T-Mobile’s new Uncarrier business strategy, Verizon CEO Lowell McAdam Wednesday rather ambiguously responded that his company isn’t really ready to kill subsidies right off the bat…

Needles to say, Verizon is so customer-oriented that it’d at least be willing to reconsider its stance – but not unless its customers first demand such a U-turn.

CNET has the full quote:

McAdam said it was “pretty easy” to change up the model to eliminate contracts, and added that he would watch the consumer response that T-Mobile gets from its recent decision to drop contracts and phone subsidies altogether.

He indicated a willingness to follow suit if consumers start asking for it.

So go ahead and start “asking for it” in the hope that Verizon would abandon its exorbitant pricing schemes.

He, of course, is very “happy when I see something different tried.”

And yes, Verizon can react “quickly to consumers’ shifting needs.”

He gave a similar lame comment back in January, telling Reuters that T-Mobile USA’s new strategy was “very intriguing,” but wondered if consumers are ready to pay full price.

Our little non-scientific poll reveals that about half the respondents are willing to drop their carrier and go with T-Mobile’s Uncarrier.

Verizon Wireless has the best 4G coverage and ranks highest in terms of voice and data service quality, according to both Consumer Reports and Rootmetrics.

What’s your stance on Verizon ignoring what looks to be a new and modern wireless industry business model in the making?

  • Share:
  • Follow:
  • Manuel Molina

    I’m not on contact with Verizon and did my full two years. I hated every moment of being weighted down. Bring on no-contract and monthly phones. It will let me get the phone of my choice without upgrading, adding two more years, going on a stupid family share plan when I only have one line, and most of all: Grandfathered unlimited data stays forever.

    • disqus_1kxFV3tRdC

      Sprint offers all of that without making you pay the full price for your phone.

      • Manuel Molina

        If you call dial up Internet, than I don’t know what to tell you. Sprint is horrible, and I’d rather pay full price for a phone and sign a two-year contact if its to avoid sprint. They suck worst than T-Mobile.

    • chris125

      I’m sure verizon would figure out some way to take those of us with grandfathered unlimited data away with this as well

      • Manuel Molina

        Well, I’ll just use the ‘I’m leaving’ concept with them.

        If they give me some bs to push me off my unlimited data plan or do so, then I’ll just tell them that I’m going to T-Mobile and say ‘don’t they offer unlimited data?’ See if that doesn’t change their tune.

  • MrShutEmDown

    I havent been in contract with Verizon since June of 2012. I’m on a “month to month” with them by simply paying full retail for my iphone 5 when it came out.

  • JaeM1llz

    Like how they “demanded” tiered data plans? lol.

  • Matt

    I have a few friends who are going for this new game plan from T-Mobile. If they’ll like it, I would love for Verizon to do the same. My contract ended so I’ll be going for the monthly payments because $100+ a month is way too much.. $99 down and $70 monthly sounds good to me.

  • pauleebe

    I call bullshit on this.

  • Jay Mac

    The real question is, if VZW and AT&T did go for cutting subsidies would they actually cut the cost of the plans as well? T-Mobile did it right. They’ve made very affordable plans and low cost monthly phone payments. I could easily see VZW and/or AT&T making people fork over the full amount right then and there and keeping their plans at the same price. Especially AT&T. Those people are strictly in it for the money. The last time they cared about their customers they were still Cingular.

    • Kaptivator

      That’s the magic question. Will they reduce monthly service plan prices for those who buy their phones outright? Only time will tell.

    • disqus_1kxFV3tRdC

      Sure t mobile is cheap if you only make calls and text people but their cheapest plan of $50.00 offers only 500mb of data. Add $20 to that $50.00 because that’s the cost you pay each month towards your phone cost and your total bill is $70.00 for unlimited call and text with 500mb of data. Sorry but I’ll stick with Sprint, 450 minutes, 450 text, and unlimited data for $80.00 PLUS I don’t have to pay the full retail price of my phone which in my case with the iphone 5 32gb would be $800.00 instead of the $300.00 I paid for it.

  • chris125

    So if they demand unlimited data be brought back they will do that too? Doubt it, verizon will only do it if it will make more money for them in the end