Verizon to Raise FiOS Rates
It was recently reported that Verizon will be ending tiered data plans, and to further upset its customer base, it will likewise be raising it’s FiOS bundled internet access, telephone and television service rates. Verizon CFO Fran Shammo states, “Look, we believe that it is a superior product in the marketplace.” Verizon spent $23 billion expanding its FiOS network, and has likewise been expanding its 4G LTE network.
As for the wireless data plans, customers who had already been paying for the $30 a month unlimited plans were able to maintain this contract, though now Verizon plans to migrate all of the older, ‘grandfathered’ data plans to its new 4G LTE network within the year. Shammo states, “Everyone will be on data share,” and old customers will have to buy into the provider’s new tiered plans. No word on how much this will cost.
Essentially, Verizon is trying to offset the costs of the expansion of its infrastructure. Shammo adds, “We have to do a better job in discipline of price increases and I think that you’ll see us do some price increases here over the next two quarters to offset the content increase and that will also contribute more profitability to the bottom line.” Shammo also banks on good Consumer Reports of FiOS, adding, “I think you’re seeing a little bit of pullback on those promotional-type items and the aggressiveness that we have in the marketplace. And look, I mean given the Consumer Reports article and the Consumer Index article, I think we can be less aggressive. Word-of-mouth is the best advertising we can get.”
No word on how much the increase in FiOS rates will be.