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James Hong

Monday, September 24, 2012

Phone plan pricing trends

After 3 years with Nexus Ones, Julia and I decided it was finally time to get new phones.

In comparing pricing plans between all the US carriers, I noticed a few things that I found interesting. First is that carriers are shifting from a "metered voice and text / unlimited data" pricing structure to an "unlimited voice and text / metered data" pricing structure. These new "share plans" also recognize that people are going to connect lots of devices per person and are metering based on that (fixed cost per device).

The other thing I noticed is that AT&T and Sprint are now allowing facetime over 3G, and in general carriers are now ok with users using VOIP over their data networks. This makes sense as they are metering data.

I wonder if the carriers are figuring out that it's ok to go with this because: 1) people dont' have as strong a sense of how much data they use versus how many minutes they talk, so they will be more likely to overbuy, and 2) the trend in general is for data usage to go up as new bandwidth heavy applications come out over time (whereas there was not such trend for voice/text). That last one makes a big difference because it potentially builds in automatic ARPU growth, making carrier management's lives easier.

Which leads me to wonder about Sprint. Sprint still offers unlimited data plans AND they allow facetime over their network. Time will tell whether Sprint shift to metering data once their LTE network is rolled out.. in the meantime they are the ugly duckling that has to give a great deal just to scrape enough customers to survive. My guess is they will, but in the longer run, how long will it take for industry competition to lead to unlimited voice/text/data plans becoming the norm? Will that ever happen?


Anonymous Anonymous said...

Hi James
I sent you an email last week but haven't heard from you. Would you be interested in selling your url to me (godaddy had your info displayed in the whois). I am a Mom in Vancouver BC starting up my own baked goods business.

8:54 PM  
Blogger james said...

Hi Leah

I never received your emails.

Sorry, the domain is not for sale. Best of luck with your new business!


8:54 AM  

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