Cross posted from the “Serious” blog. From now on I’ll post non-snark wireless and Internet items over there. The gun stuff will stay here along with everything else. -Alan
And that’s what will happen happened in response to Verizon’s announcement of a new $99 flat rate plan.
Other small carriers have offered flat rate plans to differentiate themselves, but Verizon is the first large carrier to move to flat rate pricing. We can expect the others: AT&T, Sprint and T-Mobile to follow Verizon’s move quickly. (see update below… -ACA)
It was inevitable that cell phone pricing would move to a flat rate, like POTS and long distance before. The first step was the move to unlimited in network calling a few years ago.
You’ll have to take my word (or not), but I’ve been predicting this move for years. It’s an inevitable result of the commoditization of cell phone service. The ISP industry went through the same process. Early data services like AOL charged by the minute, but as Internet service became a commodity, all the ISPs moved to flat rate billing.
Metered billing is expensive to manage. As margins decline it becomes “cheaper” to just charge a flat rate. No more thick bills in the mail with pages and pages of call records and they can reduce staff because they no longer need as many people to support simplified billing.
UPDATE: Well that didn’t take long. When I said quickly I didn’t expect AT&T, Sprint and T-Mobile to all announce an unlimited use plan TODAY. They’ve all probably had this in the works for some time, just waiting to see who would break first.
