Verizon Wireless, which says it is providing "the most customer-friendly" experience of all U.S. wireless service providers, Monday announced that its customers will soon be able to change calling plans without having to extend their contracts.
Starting Sunday, new and existing Verizon Wireless customers will have the option of changing a voice or data plan to increase or reduce voice minutes or text and data usage without changing the end date of their contracts, the company said.
Currently, customers making such changes have to start a new contract of one to two years, a spokesman explained. The change means a customer nearing the end of a two-year contract could cut back to a more affordable minutes plan without extending beyond the two years, if, for example, he had purchased a second phone on another plan and wanted to reduce his overall wireless costs.
"We're always adjusting our policies to be more customer-friendly," said spokesman Tom Pica.
Pica said the new policy will be part of Verizon's Worry Free Guarantee, which was originally created in 2001. He noted that Verizon Wireless has held the lowest "churn" rate of any wireless carrier for the past 11 quarters, and that the rate was 1.3% in the most recent quarter evaluated. Churn is an industry term referring to the number of customers a carrier loses in a given period.
Industry analyst Jack Gold said the new Verizon Wireless policy might not make much of a difference. In comparison with the flexibility available to cell phone customers in other parts of the world, having the option of altering the minutes in a plan under the same contract doesn't amount to much freedom, he said.
In Europe and other locales, users have the freedom to pull the GSM module from one phone and stick it into a phone from a different carrier. Since the U.S. primarily has CDMA networks, users get locked in with one carrier, so contracts are par for the course, Gold said.
In recent weeks, many U.S. iPhone users have decried the fact that they have to lock in with AT&T Inc.'s EDGE network. But Pica said Verizon's move was not an attempt to discredit AT&T.
Gold said that despite Verizon's claims of low churn and high customer service ratings, it is probably "somewhere in the middle" of overall customer service ratings, with T-Mobile near the top and Sprint Nextel Corp. near the bottom.
At the same time, Gold said customer service is highly variable, and if a company has a large contract with a carrier, service is better. Also, the perception of good customer service can be tied to network reliability, which can be highly variable, depending on which part of the country a customer lives in.
Pica said Verizon's reputation for good customer service is based on opinions of its customers in surveys, as well as the more objective churn rate statistics.
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