Verizon Sees Smartphone, Tablet Subsidy Costs Dropping in 2-3 Years
March 5, 2013 3:31 PM
comment(s) - last by
It's likely due to increased competition and LTE
A Verizon executive believes smartphones will see lower subsidy costs for carriers over the next few years.
Fran Shammo, Verizon Communications CFO, said that he expects subsidies for mobile devices like smartphones and tablets to drop in the next two to three years due to increased competition and use of LTE technology.
"I'm a believer that over the next two to three years subsidies will start to decrease just because of the ecosystems," said Shammo.
Shammo, who spoke at the Deutsche Bank 2013 Media, Internet & Telecom Conference, bases his claims on the fact that more mobile platforms are emerging, such as Microsoft's Windows 8 and BlackBerry's BlackBerry 10. Increased competition could lead to lower smartphone costs, and hence, lead to lower subsidy costs for carriers.
Also, through the use of
(such as Verizon's Voice over LTE), mobile devices can be launched without CDMA chipsets in them, which would also reduce prices.
While reduced subsidy prices is great for carriers, since subsidy costs are a large part of the their expenses, carriers like Verizon can easily make up for subsidy costs over the course of customer contracts with
more expensive plans
Shammo discussed Verizon's Share Everything plans, which 23 percent of its postpaid customers joined at the end of the fourth quarter. He added that Verizon has seen great adoption of mobile hotspot devices, which leads to higher average user revenue.
, Verizon posted $30 billion USD in revenue, up 5.7 percent from a year ago. It also added 2.1 million customers, bringing its total to 98.2 million wireless subscribers. The carrier sold 7.3 million LTE smartphones and hotspots for the quarter, moving its LTE technology along.
Just last month, Verizon announced
costly prepaid plans
including $60 USD/month for unlimited 3G talk and text, plus 500 MB of data and $70 USD/month for unlimited 3G talk and text, plus 2 GB of data.
This article is over a month old, voting and posting comments is disabled
so, lower contract prices?
3/5/2013 5:58:33 PM
So the reduced subsidies will be passed on to customers right?
LOL, I crack me up..
RE: so, lower contract prices?
3/5/2013 10:12:46 PM
Exactly. Let's just wait and see if the telco's profits decrease at all. Quite doubtful.
"I mean, if you wanna break down someone's door, why don't you start with AT&T, for God sakes? They make your amazing phone unusable as a phone!" -- Jon Stewart on Apple and the iPhone
Verizon Offers up Pricey Prepaid Plans: $60/month (500 MB); $70/month (2 GB)
February 1, 2013, 3:30 PM
Verizon Earnings Sag, but Posts Record Subscriber Increase Driven by iPhone
January 22, 2013, 3:19 PM
Verizon Wireless to Kill Unlimited LTE Data, Even for Grandfathered Users
May 16, 2012, 4:25 PM
Retiree Sues Apple For $7,500 for Wiping Honeymoon Photos From His iPhone
November 30, 2015, 10:23 AM
iPhone 7 May Pack 3-4 GB Memory, More Storage; 4-Inch Comeback is Rumored
November 20, 2015, 10:12 PM
OnePlus One, OnePlus 2 Will Receive Android Marshmallow in Q1 2016
November 16, 2015, 9:58 AM
Lenovo Whoa: Motorola Droid MAXX 2 and Turbo 2 Break Cover in Leaks
October 26, 2015, 3:12 PM
Leak: Apple Preps for First Real Android App Foray With New Apple Music App
October 24, 2015, 1:59 PM
Pepsi Smartphone? Empty Calories Coming Soon to the Midrange
October 12, 2015, 11:41 PM
Latest Blog Posts
Sceptre Airs 27", 120 Hz. 1080p Monitor/HDTV w/ 5 ms Response Time for $220
Dec 3, 2014, 10:32 PM
Costco Gives Employees Thanksgiving Off; Wal-Mart Leads "Black Thursday" Charge
Oct 29, 2014, 9:57 PM
"Bear Selfies" Fad Could Turn Deadly, Warn Nevada Wildlife Officials
Oct 28, 2014, 12:00 PM
The Surface Mini That Was Never Released Gets "Hands On" Treatment
Sep 26, 2014, 8:22 AM
ISIS Imposes Ban on Teaching Evolution in Iraq
Sep 17, 2014, 5:22 PM
More Blog Posts
Copyright 2016 DailyTech LLC. -
Terms, Conditions & Privacy Information