The Verizon changes that became effective on July 7th were leaked many days ahead of the launch. The media's, bloggers' and mobile industry junkies' discussion and focus has been on price increases at the S, M, L XL and XXL bucket levels. As with many carrier plan actions, the Verizon message is that there is much more data (in light of strong data consumption trends) for the new price points. The graphic below shows the plans - old on top and the new on bottom.
For industry watchers, it's clear that competitors Sprint and T-Mobile continue to enjoy price advantage. The logical conclusion is that Verizon has no chance to win back former customers or draw from Sprint and T-Mobile with this action.
Rather, Verizon's plan move was to attack AT&T to gain high-value customers AND retain its own. It's no secret that AT&T and Verizon has been very vocal about not playing for the 'price-sensitive' customers and has concentrated on customers who yield greater revenue per account. This means the target segment is large data consumers, small and medium business accounts.
Within this July price action, the more interesting movement happens at the XL and greater data levels. The bottom line here is that Verizon increased the data value gap and reduced price points against AT&T.
Let's break the action out into two chunks, the mid-range and the high-end. In the mid-range where I suspect a lot of bread and butter family plan battling happens, Verizon wins. Verizon was already winning at the $100 price point, providing 18GB whereas AT&T offered 15GB. However, the new move presented a less expensive $90 - 16GB level. The same story is at the next data contention area; the value gap is most pronounced against AT&T's $140-20GB plan. With a lower $110-24GB combination, Verizon should win the AT&T switcher.
At the high-end, it's pretty apparent that Verizon has a dramatic price and data value gap and the upper hand in selling to data hungry consumers and business data pooling accounts. Verizon wins dramatically in price as the same data levels.
What's next? Given this discrepancy, AT&T needs to respond in some fashion or risk losing these high-value users. Verizon should be turning up the marketing within business sales channels now that their sales reps are armed with pretty good products - messaging price - data value and network.
For industry watchers, it's clear that competitors Sprint and T-Mobile continue to enjoy price advantage. The logical conclusion is that Verizon has no chance to win back former customers or draw from Sprint and T-Mobile with this action.
What? A price increase? What's Verizon smoking?
Rather, Verizon's plan move was to attack AT&T to gain high-value customers AND retain its own. It's no secret that AT&T and Verizon has been very vocal about not playing for the 'price-sensitive' customers and has concentrated on customers who yield greater revenue per account. This means the target segment is large data consumers, small and medium business accounts.
Within this July price action, the more interesting movement happens at the XL and greater data levels. The bottom line here is that Verizon increased the data value gap and reduced price points against AT&T.
Let's break the action out into two chunks, the mid-range and the high-end. In the mid-range where I suspect a lot of bread and butter family plan battling happens, Verizon wins. Verizon was already winning at the $100 price point, providing 18GB whereas AT&T offered 15GB. However, the new move presented a less expensive $90 - 16GB level. The same story is at the next data contention area; the value gap is most pronounced against AT&T's $140-20GB plan. With a lower $110-24GB combination, Verizon should win the AT&T switcher.
At the high-end, it's pretty apparent that Verizon has a dramatic price and data value gap and the upper hand in selling to data hungry consumers and business data pooling accounts. Verizon wins dramatically in price as the same data levels.
What's next? Given this discrepancy, AT&T needs to respond in some fashion or risk losing these high-value users. Verizon should be turning up the marketing within business sales channels now that their sales reps are armed with pretty good products - messaging price - data value and network.
