Verizon will drop phone contracts, end discounted phones

Verizon Communications Inc. (NYSE:VZ) is a holding company that, acting through its subsidiaries, provides communications, information and entertainment products and services to consumers, companies and governmental agencies.

With that, Verizon is doing away with More Everything two-year contracts, allowing new customers to buy a smartphone at full price either up front or spread the cost out over two years by making small monthly payments around $25-$30 per month, depending on the cost of the device.

Current Verizon customers with annual contracts can keep their plans or switch over to one of four new options. Subscribers need to buy the phone outright or pay monthly installments. On top of the data bucket fee, users will pay $20 to add a smartphone to the account, $10 for a tablet/data stick, and $5 for a smartwatch with cellular capabilities.

The new plans are being implemented on August 13 and will affect millions – Verizon Wireless is the largest wireless service provider in the United States.

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Rob Miller, vice president of pricing and promotions for Verizon, said the carrier conducted extensive research with its customers and those of competitors as well as sales representatives and customer care reps in devising the new plans. T-Mobile has completely banished subsidies while AT&T only offers contracts at its company-owned retail stores.

That means no more family plans and no more being locked into providers for multiple years in order to buy phones at a decreased cost.

Smartphones are now the most important Internet-connected device to most people.

Verizon today announced some refreshed rate plans in an attempt to simplify its offerings. Each of the plans can be shared with up to 10 lines. The American carrier landscape continues to move in the direction of no contracts and easier-to-understand plans.

Verizon will still have a plan for feature phone customers that offers 700 voice minutes per month and unlimited texting for $25 per month.

A single person who plans to use a lot of data can get the $8o XL plan and couple it with a smartphone for a total of $100 monthly – pretty good.

Under the new plans, customers will pay $50 for 1 gigabyte (a price increase for both groups) and $65 for 3 gigabytes (a price cut).

Reading through Verizon’s new plans and its decision to kill contracts, you definitely get the feeling that you’ve seen this all before from T-Mobile.

“We feel we’re right where we need to be: giving you the best network in wireless”, he said.