Shared Data Plans Compared

Posted by Sam Churchill on

Verizon and AT&T are both offering shared data plans, which allow customers to share a single pool of data across multiple devices.

While the prices for shared data plans vary depending on the customer’s choices, the costs are similar between AT&T and Verizon, explains the WSJ. The cost of data can be higher than previous plans, reports the NY Times.

AT&T’s “Mobile Share” plans (above), announced yesterday, essentially work the same way as Verizon’s “Share Everything” plans (below), which were announced in June.

The pricing for both shared plans is nearly identical. After doing the math, it turns out that shared data plans are a good value only for a specific type of customer: A high-income family with several data-hungry devices and chatty kids who send lots of text messages.

Let’s say you’re a bachelor with an iPhone on AT&T, and you use a fair amount of data. On an individual plan, you could pay $30 for three gigabytes a month, $40 for 450 minutes of calls per month and $20 for unlimited text messaging. That’s $90 a month.

On the shared plan, you would pay an individual fee of $40 for the use of the iPhone each month and $70 a month for 4 GB of data. This includes unlimited talk and texting. (There is no 3-GB shared plan available.) That would come out to $110 a month.

CNET’s Marguerite Reardon explains the ins and outs of the plans in this FAQ.

Unlike Verizon, AT&T isn’t phasing out its existing plans. New customers can still sign up for individual or family packages without shared data, and existing users can keep buying subsidized phones without losing their unlimited data plans.

Shared data only makes sense if you’re willing to sacrifice gigabytes in exchange for voice minutes or text messages, or if you already spend a lot on talk and text to begin with. Voice is becoming data. Cellular operators may soon loose voice revenue with services like Skype, Facetime and Google+.

Mobile carriers are increasing the cost of data, at the same time the cost of delivering data over LTE is becoming significantly cheaper.

The cost of cellular basestation gear is also going down. Expensive, bulky basestations are being replaced by smaller, lower power gear that costs less and integrates components and modules, lowering capex and maintenance costs.

Verizon had a 42.2 percent EBITDA margin on service revenues last year. Shared data plans seem likely to increase that margin. Verizon reported 2nd quarter data revenues were up 18.5 percent year over year; with a 30.8 percent operating income margin and 49.0 percent EBITDA margin on service revenues (non-GAAP), both record highs.

Canada, Japan and the US have the highest average revenue per user. Verizon’s average monthly revenue per postpaid wireless customer rose 3.7% to a record $56.13, in the 2nd quarter of 2012.

In the United States, there’s little competitive pressure on Verizon. AT&T doesn’t have excess spectrum to handle a big influx of users so it can’t lower fees, and Sprint doesn’t have their LTE network in place.

Related articles on Dailywireless include; AT&T to Charge Extra for FaceTime, AT&T Wants 2.3 GHz for LTE, Sprint Launches LTE, “Free” Public WiFi with WiMAX Backhaul, Great Deals on Prepaid Wireless Broadband, FreedomPop: Now 500MB free/month, Sprint Brings WiMAX to Virgin and Boost Mobile, NetZero: Free WiMAX Service, Banner Ads: Google’s Next Thrust?, Free WiFi with Video Ads Expands, Free Push-To-Talk from Wave, Kindle Phone Rumored, T-Mobile USA Encouraging 2G Phase Out, Freedom Pop Connects with Sprint LTE & 3G, FCC to Okay Verizon/Cable Spectrum Buy, iBooks: Cellular’s Big Bang?, Dish LTE-Advanced Called “Ollo”, “Free” Public WiFi with WiMAX Backhaul, AT&T Talks Up Content Subsidized Data Plans

Posted by Sam Churchill on Thursday, July 19th, 2012 at 7:58 am .

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