Verizon may move to tiered pricing for data plans

Following in AT&T’s footsteps, Verizon Wireless may also adopt a tiered pricing strategy for its smartphone data plans, according to Bloomberg Businessweek.

The move may stem from the company’s expected transition toward fourth-generation technology, which is expected to offer 10 times faster data rates than older networks, the report stated. By limiting the amount of data it can offer its users, the wireless provider may be able to keep its network from becoming overburdened by gaming and video traffic.

“We will probably need to change the design of our pricing where it will not be a totally unlimited, flat rate,” said John Killian, chief financial officer of Verizon Communications, Bloomberg relays.

The new pricing plan may affect businesses that distribute smartphones to employees, as reduced mobile management and data options may deter a company from signing an agreement with Verizon.

Prior to AT&T’s and Verizon’s announcements, IDC released a report stating it expects data revenue to surge, exceeding $50 billion by the end of the year. Richard Murphy, a research analyst at IDC, said that as smartphones continue to fly off the shelves, “data revenue will increase.”