AT&T, Verizon Talk About Role of "Unlimited Usage Plans"

Based on comments made at the UBS Global TMT Conference, both Verizon and AT&T have made huge strides to convert their postpaid phone account base to “unlimited usage” plans. That, plus the tendency of U.S. consumers to buy family or multi-line plans, essentially shapes buying behavior in the U.S. mobile market. 

Even back in 2015, about half of all customers purchased family or multi-user plans, according to T-Mobile. 

The emphasis on unlimited plans is important since such plans sometimes cost more than other usage-based plans, and therefore generate higher average revenue per account. 

Where AT&T CEO John Stankey said “about 20 percent” of the subscriber base is on a “top” unlimited plan, Verizon CEO Hans Vestberg said “70 percent” of Verizon’s subscriber base already was on an unlimited usage plan. 

Vestberg did not use the same terminology as did Stankey, so it is unclear what percentage of Verizon customers buy the “top” Verizon unlimited plan. Virtually all the featured Verizon plans now offer unlimited data usage. 

Also, it is likely that what Stankey was saying is that 20 percent of AT&T accounts now are on the “most expensive” unlimited service plan, and was not saying only 20 percent of AT&T accounts have some form of unlimited usage. 

Stankey also said “we did a migration away from, let's call it, metered or fixed plans into unlimited. And we're now well over into the 80 percent range on that terrain.”

I take that to be evidence that 80 percent of AT&T mobile customers now buy some form of unlimited data usage plan, but only 20 percent are on the most-expensive unlimited usage plan. 

By about 2023, Verizon hopes to have as much as 90 percent of its customers on unlimited usage plans. Vestberg said “about 90 percent of new new accounts” sign up for unlimited usage plans. 

The larger point is that the shift to unlimited usage has reached extensive proportions in the U.S. mobile market. T-Mobile, for example, arguably drove the change by emphasizing unlimited usage for virtually all its service plans.