Verizon made headlines last week with a dramatic new data plan that shifts the focus of billing from voice to data.
Billing for voice minutes has long been the heart of the wireless carrier business model, but since smartphones started to gain in popularity the number of voice minutes have dropped. So Verizon reversed the model: they will now charge for megabytes and make voice and texting a flat-rate service. According to a report in the Los Angeles Times:
“The new payment structure is ‘a business decision to capture how people are spending most of their time with the device,’ said Chris Larsen, a telecommunications analyst at Piper Jaffray & Co.”
But the article also acknowledges that customer reaction to the plan is unknown. The new plan’s emphasis on data billing does increasingly expose consumers to the impact of “hidden data” traffic from chatty apps, IP protocol signaling and other sources that can add tens of megabytes of traffic to a consumer’s bill per month. If this consistently causes data overage charges and high levels of breakage, it could quickly sour consumers on this new billing plan.