Working up a holiday shopping list? New cellphone, iPad Mini, Netflix subscription – check, check, check.
Now don’t forget the wireless plan that makes all those family gifts work on the move. Pricing has changed dramatically since last year.
Phone calls and text messages come in unlimited quantities in the latest featured deals from the big four wireless phone companies – Verizon, AT&T, Sprint and T-Mobile USA.
The competition lies in data.
“Data” means the stuff consumers increasingly gobble up as they use wireless devices to browse the Internet, download or update apps, play online games and watch videos. Consumers have gotten used to buying a data plan for each device.
Now, however, the wireless industry has split.
Sprint and T-Mobile continue to pitch their offer of unlimited data plans for cellphones and other devices such as tablets.
Verizon and AT&T have introduced shared data plans. These allow a household to connect up to 10 devices – phones, tablets, hotspots – to one pool of data that they share.
The key: It is a limited pool. Shared data pricing means consumers have to pay more to use more data. It’s just like the traditional cellphone plans that charged more for more minutes of voice time.
AT&T said 2 million customers turned to its Mobile Share plan in the first five weeks it was available. A third of them bought the biggest monthly pools of data AT&T is offering.
It may be those early adopters were heavy users of data-devouring features. Or they may not want to risk going over the limit; about 15 percent had unlimited plans previously.
“Most people buy more data than they need. They don’t use all that data,” said Steve Baker, vice president of industry analysis at NPD Group, a market research company.
Shared data pricing puts a meter on using wireless data. Companies are looking for ways wireless customers can consume more data. Verizon eyes home thermostats, security cameras and medical monitoring bracelets that could one day connect to its wireless network. AT&T sees connected cars in the future.
Phone companies heavily discount the upfront price that consumers pay for a new smartphone. The phone companies make that money back by collecting a higher monthly bill under the two-year contract required to get a cheap price on the new phone.
As a result, data plans look like the next source of higher cellphone bills.