Verizon’s outgoing CFO Fran Shammo said the US market leader will not follow rivals in offering unlimited customer plans, arguing that the strategy will hurt competitors’ video ambitions.
Following T-Mobile US’ announcement to roll-out its One tariff, offering consumers unlimited mobile services, Sprint promptly followed suit with its own offering.
Verizon’s main rival AT&T then revealed its own unlimited data bundle, combined with its DirecTV video service.
However, Shammo, speaking at the Goldman Sachs investor conference today, was quick to shut down any idea that Verizon would come to the market with a similar plan, as he hit out at the number of conditions associated with his rivals’ offerings.
“We’re going to look at our competitors and respond where we need to respond, but we want to be simple. We have rebundled our plans, but there is no asterix with us. We offer a high speed network and we won’t degrade it if you hit a cap, which is more customer friendly.”
Indeed, T-Mobile has courted criticism after saying those consumers using 26GB of data per month or more may see data traffic prioritised behind other users. It is also offering a degraded quality for video, unless users pay an additional fee.
Shammo, who has been integral in Verizon’s big bet on video, through its Go90 platform, as well as high-profile media acquisitions of AOL and Yahoo to beef up advertising revenue, further argued that “you cannot make money from video in an unlimited plan”.
“That’s going to catch up with competitors,” he said.
And another reason why he doesn’t like unlimited is the pressure it can put on the network.
“The majority of people do not need unlimited customer plans and they can be abusive with it.”
Shammo was also particularly bullish about the company’s 5G plans, insisting that Verizon “is moving forward” with developing the technology, while at least two competitors (Sprint and T-Mobile) are still dealing with their LTE build out.
“I’m going to speed into the 5G world and it will be similar to LTE, when we get a leap on our competitors once again,” he said. “LTE was five years ago and two competitors still talk up their LTE network, while we move ahead.”
Shammo is scheduled to retire at the end of the year, after 27 years at the company.