Verizon Changes Monthly Price Structure Again, This Time for FiOS

By Jacqueline Lee June 18, 2012

Verizon has announced it will boost signal speed for FiOS, its newest bundled service that delivers Internet, TV and voice over a complete fiber-optic network. The price per customer should increase approximately $10 to $15 per month as a result, because customers will now pay for their data on a tiered plan built around data speed.

“Cable cannot touch us,” Arturo Picicci, Verizon’s director of consumer product management, told The Wall Street Journal. Comcast’s top speed is 105 Mbps; Verizon intends to offer 300 Mbps for the same cost.

Just last week, Verizon announced price changes for its mobile phone plans. Instead of charging per device for voice minutes, texts and data consumption, Verizon will provide data services for up to 10 devices per account. Minimum monthly prices start at $90 and increase $20 per wireless laptop, $10 per tablet and $5 to $10 per gigabyte of data.

Growth of photos, video and Web access over mobile devices is transitioning the Verizon pricing model to revolve around data instead of around minutes and texts. With today’s move, Verizon bets customers will be willing to pay for more speed on its FiOS network.

Verizon spent over $23 billion dollars and nine years building their FiOS network. The increase in speed shouldn’t cost much for Verizon, as the network infrastructure is already in place.

According to the company, new top FiOS speeds could reach 300 Mbps, which means downloading a 2-hour HD movie in just two minutes.

In contrast, the lowest FiOS speeds and mid-range speeds on competitor’s services, like AT&T U-Verse, would require about 45 minutes to download the same movie.

Many analysts argue that homes really don’t have a need for increased speed. To run AppleTV, Apple recommends a network speed of just 8 Mbps. Most homes, according to Barclays analyst James Ratliffe, never exceed 25 to 30 Mbps even with multiple streams of video coming into the home.

For gamers looking for a seamless online experience, however, Verizon’s increased FiOS speeds will be a tempting offer. But Picicci says Verizon expects that most customers will opt for the 50 or 75 Mbps plan, which will match the price of the current 25 or 30 Mbps plan.

Edited by Braden Becker

Contributing Writer

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