Verizon backs off $30 unlimited data plan for iPhone

iphone_verizon_phone.gi.top.jpgWhat's the difference between this iPhone and an iPhone that uses AT&T? This one gets unlimited downloads -- for now. By David Goldman, staff writer


NEW YORK (CNNMoney) -- Take that, AT&T! Well, sort of.

Verizon (VZ, Fortune 500) poured some gas onto the iPhone fire Tuesday morning when it announced that it would offer the same $30 unlimited data plan for the iPhone as it offers for all of its other smartphones.

But by Tuesday afternoon, the company updated its announcement and backpedaled, saying it would only offer the unlimited iPhone data plan "for a limited time." Those who get in during the window will have unlimited data on their iPhones throughout the life of their Verizon contract.

The company declined to comment on how long the temporary unlimited offer would last. But it said that after the initial period, it will move to a metered system similar to the one used by AT&T (T, Fortune 500), which makes its smartphone customers pay for the amount of data they consume.

In June, AT&T slashed the starting prices of its data plans, but also added caps to them and eliminated its unlimited plan. AT&T customers now pay $15 a month for 250 megabytes of monthly data, or $25 for 2 gigabytes and an additional $10 for each gigabyte of monthly data usage that exceeds the allotted 2 GB limit.

So even though the cheapest available monthly iPhone voice plus data plan on AT&T is $54.99, compared to $69.99 on Verizon, customers that download 2.1 GB of data on their iPhones will pay $69.99 if they have Verizon -- compared to $74.99 on AT&T. For a limited time, anyway.

That's not so hard to do: If you want to watch Netflix (NFLX) on your iPhone using a mobile connection, 2 GB only gets you between six and 12 hours of streaming movies and TV shows, depending on the bit rate.

When it unveiled its iPhone earlier this month, Verizon Wireless declined to discuss the phone's data plan pricing. That fueled speculation that Verizon would go the way of AT&T and introduce a tiered plan, ditching the all-you-can-eat option.

Early Tuesday, the company seemed to recognize that would be a competitive mistake.

"I'm not going to shoot myself in the foot," Lowell McAdam, Verizon's chief operating officer, told the Wall Street Journal on Tuesday. He said that moving towards a tiered data plan would reduce the number of iPhone customers that would defect from rival AT&T.

But after initially backing his comments, the company pulled back. More details of Verizon's data-pricing plan will be announced later, a spokeswoman said.

AT&T has been pounded for years about its network struggles, which recently got it crowned "worst carrier" in America in a Consumer Reports survey. The company's 20 million iPhone customers are often its most vocally unhappy customers.

Still, only about 2.5 million customers are expected to defect to Verizon next month, according to numerous analyst estimates, thanks in large part to the high early termination costs that AT&T built into its contracts.

The iPhone will be available to Verizon customers for pre-sale Feb. 3 and it will appear in stores on Feb. 10. To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Index Last Change % Change
Dow 16,399.67 19.26 0.12%
Nasdaq 4,316.07 57.63 1.35%
S&P 500 1,904.01 17.25 0.91%
Treasuries 2.18 -0.02 -0.82%
Data as of 11:48pm ET
Company Price Change % Change
Apple Inc 99.76 2.09 2.14%
Bank of America Corp... 16.26 0.05 0.31%
Pfizer Inc 27.93 0.10 0.36%
Facebook Inc 76.95 1.00 1.32%
Microsoft Corp 44.08 0.45 1.03%
Data as of 3:32pm ET

Sections

Better-than-expected iPhone sales and record Mac sales lifted Apple in its fiscal fourth quarter. More

China's economy has clocked its worst quarter in more than five years, raising concerns over Beijing's ability to meet its own annual growth target. More

In three years, all Chicago high school students will have to take a coding course in order to graduate. More

Host a furniture market. Here's how small town High Point, N.C. rakes in this much money -- twice a year. More

Detroit has 80,000 dilapidated properties and 100,000 empty lots. It's trying to get more people like Antjuan Wyatt to buy them. More

Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.