Verizon, AT&T, T-Mobile Announce Unlimited Minute Plans
Major U.S. carriers are adding unlimited wireless minutes to their set of plan options. Hours after a Verizon Wireless announcement this morning saying such a plan was available yesterday (Tuesday), AT&T said it would match the offer starting Friday. About two hours later, T-Mobile said it too would sell unlimited minutes, but raised the $99.99 deal to include SMS. Sprint Nextel and Alltel are likely to follow, analysts said.
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Verizon Wireless customers can pay $99.99 per month to get unlimited minutes, it said Tuesday morning. Users can use minutes anytime to call any landline or wireless phone in the U.S., it said. Verizon is also adding two new BroadbandAccess data plans, it said. Starting March 2, Verizon customers can get 50 MB monthly for $39.99 per month or 5 GB for $59.99, it said.
Verizon took “preemptive action in what would have been an inevitable industry trend,” said Current Analysis’s William Ho. “For weeks, the press speculated when Sprint would roll out a national unlimited voice calling plan as a measure to win back customers. Now, Verizon Wireless has grabbed the spotlight and media buzz, positioning itself as a first mover.”
Wasting little time, AT&T said Tuesday it would also sell unlimited minutes for $99.99 per month. It’s not “coincidental” AT&T’s news came the same day, said Stanford Group analyst Michael Nelson. Unlike Verizon’s offer, AT&T won’t start selling its new plan until later this week, indicating AT&T saw the Verizon announcement this morning and “quickly followed suit,” he said. Ho agreed: “AT&T’s quick reaction was purely a competitive response,” he said. “It could not allow its high-value users to be poached.” The AT&T announcement shows the carrier “can respond quickly in a highly competitive industry,” a spokesman said.
After news of the unlimited plans broke, a T-Mobile spokeswoman said the carrier already offered unlimited minutes in the form of MyFaves, HotSpot@Home and unlimited e- mail plans. An hour later, she changed tune, saying T-Mobile would one-up both offers, selling a $99.99 plan with unlimited voice and messaging. T-Mobile’s plan goes on sale Thursday, a day before AT&T. “How quickly they react,” said Ho. “This is indicative of how competitive the market is.”
“Sprint will be next and then Alltel,” predicted Ho. Nelson said he agreed the “all-out pricing war” would continue. Sprint already sells unlimited voice, data and text for $119.99 per month in San Francisco, Minneapolis-St. Paul, Philadelphia and Tampa, a spokeswoman said Tuesday. However, the Verizon and AT&T announcements will likely force them to expand the offer nationally and reduce the price, Nelson said. “We are continuously evaluating our market offerings but are not disclosing any future plans at this point,” a Sprint spokeswoman said. Alltel didn’t immediately return a request for comment.
Verizon and AT&T stock prices “dropped sharply” after the announcements, Nelson noted. After regular trading Tuesday, Verizon’s stock had dropped 6.58 percent to $35.34 and AT&T’s had fallen 5.25 percent to $35.89. Shareholders are worried the unlimited offers will dilute the carriers most profitable subscribers since subscribers paying between $120 and $200 a month will want to “trade down” to a $100 plan, he said. Verizon and AT&T declined to comment on the market movement, but an AT&T spokesman said the offer would help AT&T better retain and attract customers.