Verizon “Enhanced Multimedia Phones” to require data plans, death of the Vpak, and more
In this day and age, carriers are all about data and rightfully so. Subscribers are becoming more reliant on data-dependent mobile apps and services each day, and carriers are hardly about to miss out on the potential revenue — just look at how many people gobbled up AT&T’s $30 iPhone data plan without batting an eye. Verizon is pushing data just as hard as any other carrier (BlackBerry BOGO, anyone?) and come September, Big Red is turning up the heat even more. One of our ninjas hit us with a brief internal VZW slide deck and it details several new policies about to go into place — the most notable change being the introduction of a new device class: the “Enhanced Multimedia Phone”. To fall into this new category, a handset must have an HTML Web browser, EV-DO Rev. A, a QWERTY keypad and it must launch on or after September 8th; making the Samsung Rogue VZW’s first handset to meet the criteria.
Enhanced Multimedia Phones might not be smartphones but they will require a data plan just like their big brothers and sisters. Customers who snatch up an Enhanced Multimedia Phone will be required to chose a data plan of $9.99 for 25MB or $19.99 for 75MB. Other changes currently brewing at Verizon include the death of the $15 VCAST Vpak (current subscribers grandfathered) and introduction of a $10 “VCAST Video On Demand” plan. For those unfamiliar with the option, the Vpak provided unlimited data for feature phones whereas the new $10 VCAST plan will only provide unlimited videos, thus requiring either the $9.99 or $19.99 data option for users wanting Web, email, etc (or pay $1.99/MB without a data plan). Hit the jump for a larger version of the slide above along with the rest of this short but informative deck.
I’m not a fan of mandatory plans but I understand why some devices need them more than others.
Being the cynical type, I hate to agree that one thing VZW claims appears true: Most people who save the cost of a data plan actually pay more in a la carte charges. (This excludes your uncle with his 2001 vintage phone.) Although I’m pissed about the $15 unlimited plan going bye-bye, it’s good that something different from “all or no” data is being offered. Until now, only T-Mobile seemed to realize this.
I can’t see how they (subs, employees and such) justify eradicating the unlimited option when no other national carrier is doing this. Sprint has one line of feature phones, one line of smartphones (RIM) and one smartphone that requires a specific plan but even then it’s still more inclusive and less expensive than any other while offering 3 unlimited data for all phones. $15 Data Basic w/some tv/radio, $25 Data Premier w/lots of tv/radio/nav and $30 Pro Pack w/tv/radio/nav/messaging, the last of them is requried for RIM if you don’t have a the Everything Plans
The problem with the mandatory data plan is that phones with WiFi capabilities are becoming more and more the norm. People might not be aware of this (particularly that guy back on page 4 luikang) but there have been these magical devices called PDAs in existence since long before “Smartphones” were all the craze. And they used WiFi connections to do all the things that these cell phone companies are saying data plans are “necessary” for, like e-mail, browsing web, etc. Wanting to combine the functionality of your phone and your PDA without getting ripped for some $700+ more over a 2 year contract isn’t being a crybaby, or wanting to look “cool”, it’s something practical for a lot of businesspeople.
Addressing another issue, people getting busted with high a la carte fees happens because the phone carrier companies makes the end user have to jump through hoops in order to block data on their phones. This is something that would be presented as an upfront option in honestly conducted businesses. These guys are just waiting and hoping for the user to accidentally hit some keys and browse some pages – massive payout for them. For the cell carriers to say we got too many complaints about people getting data plan overcharges so we’re making a data plan the default isn’t “helping” the customer at all. Having a clear-cut easy to find option that disables the network data option and only allows WiFi would be helping the customer, and would solve this problem completely. And it’s not dark voodoo magic to do this either, phone hacking enthusiasts have already found ways to do it on a variety of phones, and if they can do it with digging and research the major phone carriers could do it with the blink of an eye.
Bottom line, the only bullshit being served here is to the customer. Anyone defending the phone carriers on this needs to open their eyes and stop accepting their terrible reasoning as to why data plans are mandatory. Want to regulate your use of the Smartphone to WiFi only areas? You should be allowed to. Want to fork up that extra cash because you find it worth it to access e-mail and web “anywhere”? That should be an option too. Technology to do both, and to do both in a more plain-cut, easily-understood manner is there, but they have no incentive to give it to us if we just take the battered spouse route and accept what they tell us because we don’t know better.
On sept 8th on got the rogue since i already had the data plan vcast pak i was grandfathered in to upgradning to a high plan or doing the new data plans 9.99 19.99. if u are a vip customer u always get the 35 fee waived 4 activation. if any rep says u have to upgrade to all new plans and u had vcast on your acct b4 sept8th they are lieing and talk to a manager. had 3 reps try to screw my friends aying vpak is gone no not if u had it b4 he new price plans where implmented. krista
I live in a rural area where we don’t get cell phone (wireless) coverage (yes these still do exist). We have high speed DSL. So if my cell phone won’t work at home- where I work–anyway, and can only access data via my home wifi, why should i have to pay for a data plan?? This is a ripoff, just a way to tack more and more onto the bill. None of us should be penalized for having a smartphone to sync with our calendar and contacts.
@Lisa – You’re exactly right. As the consumers we should have the freedom to do what we want. The legalese wording for what’s happening here is “product bundling” or “product tying”. Read up on it at http://en.wikipedia.org/wiki/Tying_(commerce).
There is a section that goes “Some kinds of tying, especially by contract, have historically been regarded as anti-competitive practices. The basic idea is that consumers are harmed by being forced to buy an undesired good (the tied good) in order to purchase a good they actually want (the tying good), and so would prefer that the goods be sold separately. The company doing this bundling may have a significantly large market share so that it may impose the tie on consumers, despite the forces of market competition.”
This is exactly what is going on here, because there is no market competition against this practice (AT&T, Verizon, Sprint, and Tmobile all force the purchase of a data plan on their newer “smartphone” style devices) we the consumers don’t have a choice and are forced into purchasing something we don’t want.
This is really stupid of the cell phone companies, monopolizing the packages and plans like this, only in America though. What a RIPOFF of a plan……NOT A DEAL. so from now on you cant get the phone you want unless you purchase uncessary shit that you dont need with it, [Data Package or Nationwide Premium or Connect Plan Required for Enhanced Multimedia Phones] I use my cell for talking and text etc but i dont need the damn internet on it, never works anyways. what a stupid decision by verizon to do this, they just lost another customer.
1. Unlimited data plans are not being eliminated. That’s what the “connect” plan is for and the Premium also includes it. If you don’t want all of your lines to have to be upgraded to connect just ask the rep to juggle the lines around and make the one line that requires it the primary line in the FSP and then leave the others as secondary lines with Basic or Select. You can do it, I have more than once.
2. This is not “product tying” You can go into any Verizon store and buy whatever phone you want for the $400+ dollar full retail and walk out the door with it without anything. When you ACTIVATE it on their service then is where the requirement comes in and they have the right to set the prices and required features for individual phones and phone types. If you don’t like it you are free to go elsewhere but I can pretty much guarantee you that a year from now the competition will all be doing the same thing.
3. If you don’t want a phone that requires the data plan then don’t buy an advanced multimedia phone. There are plenty of phones that do not qualify as an advanced multimedia phone that are not just basic flip phones.
Like what? I went on verizon’s website and saw one phone with a qwerty keyboard that doesn’t require a data package
Tim, if any wants unlimited data as of now it is no longer a stand alone add-on, in essence they got rid of unlimited data. I would understand this practice with the Versa since it is the most avanced feature phone they have but not the Rogue
@Tim – This is product tying because they are bundling the voice plan and data plan together for those phones. You cannot get voice service for your smartphone from Verizon (or any of the other major carriers for that matter) without also purchasing a data plan. It doesn’t matter if you buy the phone from them at a discount, at full retail, or from some overseas dealer, or from your next door neighbor if you want to use that phone on their network you must buy BOTH services. By saying they have the right to set the required features for individual phones you’re mincing words, basically saying they have a right to do product tying for the phones they see fit. Just because it’s a subset of all the phones offered does not mean it isn’t product tying. How far does it have to go before you will say it is product tying? All the phones? Perhaps they’ll continue on the same line of logic – all their phones offered currently have text message capabilities, so if you want to use any of those phones you are forced to sign up for a text message plan as well. Maybe that will qualify as product tying in your eye.
As to your suggestion to get other phones, I could not find any phones that had WiFi capabilities that did not fall under their definition of advanced multimedia phones, thus requiring the data plan.
There is a demographic of users out there, fostered out of the era of PDAs, that are just fine with only getting internet and e-mail connectivity when in a WiFi enabled area. From anecdotes I know a good number of people who work in large buildings where the cellular coverage is terrible because it can’t get through the walls but WiFi is abundant. There are even users who live in areas where 3G has not become available yet so the data network is not even accessible to them – but they still have to pay for the data plan if they want a WiFi enabled device. The devices are able to do all their functions using only WiFi, and in the past you could call up and request full data block for your phone, and there are easy to access settings in Windows Mobile that can make it so you don’t even attempt to connect to their data network. These options are rapidly disappearing if they are not gone entirely.
Technology is not this mysterious unknown, the carriers know exactly what they are doing by eliminating the data block option and making it difficult in their proprietary software to find ways to disconnect from the data network and use WiFi instead. They want to force their solution at all costs because letting people use only WiFi represents a huge loss of revenue. So they make it seem like the phone devices operate on dark voodoo magic that they have no control over so you better sign up for the data plan or locusts will descend on the cities. In reality they have complete control over how these devices operate, and could easily put in software options that would prevent data network access or provide warnings when attempting to access the data features on their network when you don’t have a plan.
I understand the argument that Verizon got burned by people on past pay-as-you-go schemes that would call up and dispute their large bills and win. I also understand the argument that Verizon subsidizes phone prices and wants to make that back on data plan charges. But both of these arguments have easy counters. First, the data blocks already mentioned. Bring them back. And put obvious warnings into the software when the user accesses the data features. Then when they go to court they can say “Look! Even a monkey could see they were accessing the data network here!” Then the customer would have to pay up for their irresponsible overuse. Second, if Verizon makes up their subsidy via data plan charges, fine. But where is the option to purchase the phone at an unsubsidized price and use it on their network without a data plan? It’s not there because once again such an option would either make them look like highway robbers if they want to maintain their current level of revenue per user (because the data plan costs more than cover their subsidy), or their revenues would go down.
Offer less choice, force more defaults, make mroe revenues! An awesome business model unless you happen to be a consumer.
We are not talking about pda/smartphones here. We hare talking about advanced feature (dumb) phones that for the most part dont have WiFi.
The reason that they don’t allow a data block option is that it also blocks MMS. Standard text messages piggyback on existing data packets on their basic voice network. This is why they harve the 160 character limitation. MMS (pic messages) go over the data network and blocking all data also blocks MMS. They may not bill for the data those use (though this has been debated in some circles) but they still travel over that network. Picture messaging has become so common place these days that they would field just as many customer questions/complaints overthat.
And the carrier has the right to do whatever they please when it comes to these things as long as it is spelled out up front. Conversely you as the consumer have the right to go elsewhere.
@ Don Louie
Again I say then upgrade to the CONNECT plan to get your unlimited data. And actually it is $5 less to go that way then it was to get vPack. If necessary swap lines around on the family share plan to make the line that needs it primary and lines that don’t secondary. This isn’t rocket science.
I personally predict that they will eventually elimiate all line item add ons and just bundle features together like they did with connect (unl data and messaging) and premium (unl data, messaging, mobile email, vznav)
@Tim – “And the carrier has the right to do whatever they please when it comes to these things as long as it is spelled out up front. Conversely you as the consumer have the right to go elsewhere.”
Unfortunately this reasoning is false, that would be like saying a business can run a monopoly on a service and charge exorbitant prices as long as they are upfront and say that is what they are doing. Just because you are upfront about it doesn’t mean it isn’t a limiting of consumer choice, anti-competitive practice, product tying, or what ever it is you are doing. This might be the reality you want to live in, which would be a much more hard-lined definition of capitalism, but we’ve collectively learned over time that pure capitalism leads to a lot of bad for the consumer.
You are touting the same reasoning the carriers do on the data block thing. It isn’t dark magic to put into software blocks on web/e-mail use and allow MMS to pass, I guarantee you they could do it easily if they wanted. But they don’t want to for reasons I’ve already elaborated on.
Lastly, regarding the consumer option of going elsewhere, there isn’t one. All four of the major carriers have bundled their voice service and data service when using their “advanced multimedia devices”. This is beginning to creep into phones that are “dumber” such as the Samsung Rogue.
And you’re probably right they will bundle all the things together into a single package, it follows exactly on their line of actions thus far. The more things they can cram into a mandatory purchase the more revenue they stand to make. How you don’t think this is product tying and yet you use the word bundling to describe it is beyond me.
Don’t wanna submit to the almighty cell scam???
Get an ipod touch (you can ONLY use it on WIFI, but you can also sync it to your calendar, contacts, etc.
Get a pay as you go phone or the cheapest plan you can find.
You win!
Don’t wanna submit to the almighty cell scam???
Get an ipod touch (you can ONLY use it on WIFI, but you can also sync it to your calendar, contacts, etc.
Get a pay as you go phone or the cheapest plan you can find.
You win!
Tim, what about those that took advantage of vcast tv w/thier $15 unlimited data, now they have to get a $10 vcast pack or get a Premium plan which would actually be more money. You keep saying it’s saving money but only if they didn’t use vcast
Why I think this is unfair:
I have a very annoying phone from verizon and I’m due for an upgrade in 2 weeks. I went in to do a little pre-shopping and was told that even though I already have a data plan if I choose anything they consider a smartphone,I will have to pay even more per month, just for the pleasure of using the same data plan I already have via a smart phone. Keep in mind I’m already going online constantly with my current phone. Because I got it a few years ago it’s not considered a smart phone. But if I get the phone that is closest to my current phone now -smartphone. God forbid I should want a blackberry. Then they want to charge me at a third, even higher data level. I don’t have great access to wi-fi so in my case I do need some data plan (although I firmly agree with Compguy65 and Jebediah Springfield- this is tying and consumer law says it’s illegal)but it is clearly not neccessary for them to change the rate they charge me per month for my data usage based on arbitrary designations given to the device by which I access their network. I thought, “screw this I’m switching carriers!” Then I found out I have no choice, all the carriers moved as one to kick-up their profits. Or actually I do have a choice- I can get a phone even less convenient than my current model,affording myself less convenience even though the technology is moving forward, or i can start paying a whole lot more for the exact service I already have, with no value added for me.
Maybe I have a third option involving switching out SIM cards or buying on E-bay but honestly I don’t really understand all that and there’s no guarantee they wouldn’t get wise to the fact that I’m using a “smartphone” or PDA and change what they charge me to the highest possible amount, just because they can.
@minbmore – Be very careful if you do try to use the SIM card trick, the basic idea there is to put your SIM into a “dumbphone” and that will permit you to cancel or perhaps downgrade your data plan, and then switch the SIM card back into your “smartphone” and pray they don’t notice it happened. It is becoming less and less likely that they won’t notice however, because the phones now communicate device information to the carriers (known as an IMEI number) and they’ll slap the data plan on you as soon as they find out.
The other idea you mentioned would be to get an unlocked phone from eBay and bring that to your carrier. As far as I know this won’t work either – although the carriers argue persistently that the data plan charges help them recover the cost of selling the phone at a reduced price, I haven’t found any scenario in which an unlocked “smartphone” device purchased from an outside source can use the carrier’s voice network without also being slapped with one of their most current data plan pricing. In another BGR comment thread there was a consumer who had a similar problem to you – they wanted to re-activate a phone they had already been using with a carrier in the past, but the re-activation would brand it as a “new” phone in their system, causing them to lose their grandfathered status that allowed them the cheaper data plan. Even better they didn’t tell the consumer that this was going to happen, they just got to see it when their next monthly bill arrived.
Don’t expect the carriers to bend on this, as you’ve noticed they’ve all done this uniformly together such that there is no consumer choice. Until they get busted up by a government organization like the FTC DOJ or something they’ll continue doing what they’re doing because it gets them the $.
Yeah, neither:
-carrying two devices just so you can continue to use a PDA and a phone without being unfairly charged for 3G you don’t want, nor
-paying for a pay-as-you-go plan, which is FAR more expensive than a contract plan
would be “winning” – like, not even remotely.
It’s half amusing to think of someone using that “solution” merrily go on their way thinking they’re sticking it to the man. Half just sad because either that is a phone company rep or someone who demonstrates so well consumers’ widespread lack of awareness about being taken advantage of.
I just found out my own Mom was paying more than $200/month for several months from going over on her minutes and not even using the 10 free people you get to designate with the Verizon 1400+ minute plans. If the companies were actually worried about protecting people from overages, wouldn’t they have had some fabulous policy in place to prevent such a thing? Or just have programmed a quick automated SMS reminding people about their 10 people, if they had all been sitting empty for a year? Hmmm… but no they just took her money for the overages, fancy that… so it appears this smartphone mandatory data plan is the one and only policy that is motivated by the benevolent goal of protecting people from overages, but unlike notifying people of going over on their minutes or anything crazy and probably impossible like that, this policy just happens to make them sh* tons of money, that’s funny… and as of this writing there seem to be no other policies that either protect people from overages (e.g., unlimited voice minutes for everyone) or ensure (force) taking full advantage of peoples’ devices’ every capability (e.g., mandatory monthly GPS subscription service on every GPS-capable phone)… it is just uncanny. But sometimes it feels like even if the phone companies did make policies like that, so many consumers would just go along with it and fork over their hard-earned cash because they have no other option. The key is all making the same policy at the same time, and calling it “the industry standard”.
This smartphone thing is emblematic of a list of similar issues (issues like subsidizing or not subsidizing phones and then mandating lengthy contracts with early termination fees – why would that be necessary, other than to encourage more people to start service and then make back the money they lent them on their phones several times over?) Seriously, the most common program I use in WinMo is my password storage program. It doesn’t even sync wirelessly, it syncs by USB. Soon I won’t be able to use it in the same device as a voice-capable phone, just because of this policy.
Why not just shut up, give up, and pay up? Because with my fantastic google skills I have actually learned how my wifi-capable phone works and realize that voice and 3G are two separate services, because paying for something I don’t want or need is not a status symbol for me, because being charged for 3G that I am not even freakin using is ridiculous, and lastly even if I weren’t solely supporting a family – and even if I were making a lot of money, I wouldn’t be successfully managing it if I threw it away bit by bit on things we didn’t want, need, or use.
Just discovered that the current FCC investigation into wireless companies was because of the efforts and concerns of Senator Herb Kohl from Wisconsin. He is the Chairman of the Senate Subcommittee on Antitrust, Competition Policy and Consumer Rights. Since his web contact form is only for Wisconsin residents, here is his email for the general public to contact him, from the U.S. Senate website: senator_kohl@kohl.senate.gov
I would think he would want to know what consumers think about this policy.
All in all, not a horrible way to do business. Plus, me being a huge Family Guy and Lost fan makes the whole full episodes offering a good deal all considered.
Tying data plans to cell-phones is illegal. If you don’t believe me go here: http://en.wikipedia.org/wiki/Tying_%28commerce%29
Do your part to put an end to this by filing a complaint on the following websites.
You can file a complaint with the FTC at https://www.ftccomplaintassistant.gov/
You can also complain to the FCC at http://esupport.fcc.gov/complaints.htm
Defend your rights before they are all taken away.
I’m retired. I stay home everyday. I don’t need a data plan. I can’t buy a new PDA phone without a data plan. I use WIFI when I travel two weeks per year. $360 per year to get e-mail on vacation? I don’t think so! I’ll stick with my no-data-plan VX6800 forever. I’m filing complaints.
I completely agree with those stating the how shitty it is to be charged for a data plan when you phone comes with wifi. I too come from the age of PDAs and grew tired of carrying both. Most true smartphone users could give two shits about the “cool” factor that is only now associated with PDA/smartphones. Most calendar functions on basic phones suck, which along with document editing is my biggest reason for that type of phone. I wrote a compliant to the FCC earlier this year and received a letter back from them saying they would investigate. Two months later another letter arrived saying nothing was wrong. Being charged for a service the phone inherently supplies is RIDICULOUS! But, then again Verizon has ALWAYS crippled their phones. It always comes down to money and greed and the little people rarely win.
What I don’t understand is the fact that Verizon makes data plans mandatory on phones that have wi-fi capability. I’m in college about half of my day surrounded by wi-fi everywhere. The other half of my day is spent at home where I also have a wi-fi connection. Verizon should reconsider making their wi-fi capable phones optional to the data plan because they would relly bring in alot more customers. Most people reconsider getting a PDA or Smart phone due to the fact that they have to pay 30 dollars extra apart from their plan, just to be able to use that phone.