Starting August 31, Verizon will issue an ultimatum to wireless customers who use “extraordinary” amounts of data every month: either move to one of the company’s five tiered service offerings or face having their lines disconnected.
The migration plan is aimed at legacy customers still on Verizon’s old unlimited data plan, according to a Wednesday report in Droid Life. Over the past several years, the company has made a number of changes affecting users on such plans, including raising the monthly prices.
Verizon currently offers five different mobile service plans with data caps of 2 GB to 24 GB per month. It last updated those options earlier this month, raising data allowances for each and increasing monthly prices by $ 5 to $ 10.
Rising Data Usage, Changing Habits
Rolled out on July 7, the changes to the service plans were designed to address rising customer data consumption. The average Verizon customer’s monthly data use has nearly tripled over the past three years, largely because of increased viewing of streaming video content.
Despite changing user habits, wireless plans with unlimited data have become increasingly scarce in recent years. Verizon, for example, began grandfathering support for such plans in 2011, and AT&T now provides unlimited data only to customers who have had the service since 2009 and haven’t updated their phones since then.
Increasingly, customers are keeping their current phones and plans, according to several recent studies. For example, a survey by the marketing firm Fluent in June found that 42 percent of smartphone owners plan to keep their current devices for at least three years.
Fast-Growing LTE Data Traffic
In its report, Droid Life cited unnamed sources who said Verizon was “working on an unlimited data plan migration for the highest unlimited data users on their network.” The article noted that Verizon began notifying a “small group” of such customers on Wednesday about their changed service options as of the end of August.
Those sources didn’t specify how much data consumption qualified as “extraordinary.” However, the largest data plan currently offered by Verizon offers 100 GB per month to be shared by multiple users. We reached out to Verizon for further details about these latest changes, but did not receive a response.
According to Verizon’s most recent earnings report, released in April, the company has 112.6 million wireless customers, with nearly 74 million using smartphones. About 92 percent of the company’s data traffic is on its LTE network, which is seeing data consumption grow by around 50 percent year over year.
The company also reported strong wireless customer retention rates, with a quarterly churn for postpaid customers of just 0.96 percent. Verizon’s next quarterly financial report is set to be released Tuesday.
