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Allset Offers Simplified Pricing for Verizon Wireless Prepaid Subscribers, but More Will be Needed as Competition Heats Up

by Ken Hyers | 3月 05, 2014

Verizon on March 3rd announced that it had revamped its prepaid wireless plans to provide more flexibility for customers.  The new Allset offering creates a single base prepaid plan for $45 which provides unlimited voice, text messaging and 500 MB of data while giving customers a choice for additional data packages at three different price points:

  • 500 MB for $5 with 30-day expiration
  • 1 GB for $10 with 90-day expiration
  • 3 GB for $20 with 90-day expiration

While the new plans are straightforward and offer greater value than previous plans by allowing customers to carry over data purchased from one month to the next, they do not move the needle signficantly in the battle between the tier one operators to grow their prepaid customer bases.  For Verizon Wireless, this is by design. 

Verizon Wireless has alwasy positioned itself as, primarily, a higher-value postpaid carrier.  Prepaid is, and always has been, secondary for Verizon Wireless, which isn't willing to sacrafice profitability to chase prepaid volumes.  Its new Allset plans are more accessible to the prepaid market, but it is is clearly seeking to maintain a clear differentiation in value between its prepaid and postpaid offerings. Clearly the Allset plans have been designed to offer more choice to its prepaid customers while avoiding prepaid canibalization of its postpaid base.

Verizon Wireless' unique selling point (USP) has always been network coverage and quality (not price), something that it extended by being the first and fastest to nationwide LTE.  Now that AT&T has caught up in LTE and Sprint and T-Mobile are expanding their own LTE networks, that USP is under siege.  At the same time, value pricing has become steadily more important.  Verizon's Allset plans are a step in the right direction and will appeal to customers already leaning towards Verizon Wireless due to its perceived coverage and quality advantage, but as AT&T increases recognition of its own strength in this same area, and both it and T-Mobile leverage their Cricket and MetroPCS acquisitions, respectively, in prepaid, Verizon Wireless could see erosion of its base to competition.  From this standpoint, while Allset is a step in the right direction, Verizon Wireless will likely need to take additional steps in order to provide additional value to prepaid customers going forward.

Our Handset Country Share Tracker (HCST) service report USA Smartphone Vendor Marketshare by Operator: Q4 2013 provides marketshare and smartphone unit shipment data for smartphone vendors for each of the Tier 1 operators in the USA.  The report is a key tool for tracking current and historic performance for smartphone vendors by mobile operators in the US market.

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