Verizon Still Experimenting With LTE Pricing Models

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Verizon apparently hasn't made a final decision on how it will charge users of its 4G LTE data services.

In an interview with The Wall Street Journal Thursday, Verizon CEO Ivan Seidenberg said that the company was considering charging customers on the basis of both their connection speeds and the amount of total data they consume.  Previously, Verizon had floated the idea that it would charge LTE users solely on the basis of their monthly data consumption.

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But Seidenberg on Thursday indicated that the company might open up more options for users besides just paying more per month for larger data allowances.  For instance, Seidenberg said that users who consume a small amount of data but value fast connectivity can have one type of pricing plan while users who like consuming lots of data but don't care how fast their connection speed is can have another plan.  Seidenberg emphasized that no plans have been finalized yet and that the company was still trying to "figure out what the customer thinks is fair, and go from there."

4G technologies such as LTE and WiMAX represent the next stage in the evolution of wireless data technologies and generally deliver average download rates of 3Mbps or higher.  Verizon is expected to debut its 4G LTE services commercially sometime before the end of the year.  This past fall the company announced that its LTE network would be live in 38 U.S. markets and would cover around 110 million points of presence by year-end.

Since both WiMAX and LTE are both IP-based wireless data standards, the wireless industry has started moving away from all-you-can-eat wireless data plans and toward tiered service plans. AT&T got the ball rolling earlier this year when it announced it was dropping unlimited data plans for the iPhone in favor of plans that offered between 200MB and 2GB of data consumption per month. Verizon shortly followed suit by saying it would implement a similar pricing scheme for its 4G LTE services that are due to launch later this year. Verizon COO Lowell McAdam hinted earlier this year that LTE plans would give users a certain amount of data they could consume every month before they would have to pay overage fees.

Not all U.S. carriers are on board with metered wireless data consumption, however. Earlier this year Sprint 4G Vice President Todd Rowley explained that Sprint would be reluctant to implement 4G data caps after it experimented with 5GB data caps on its 3G EV-DO Rev. A network. Rowley said that the company found many customers becoming worried about using data after implementing the cap, meaning there was less consumption of data on the network overall.

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This story, "Verizon Still Experimenting With LTE Pricing Models" was originally published by Network World.

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