Verizon was forced to join the unlimited-plan parade with its rivals, analyst Joseph Bonner notes -- and the company acknowledged that a customer bleed-out was reversed partially by introducing its unlimited plan.
"Verizon’s strategy had been to monetize increasing data usage, an approach that appears unlikely to work in the current ‘unlimited’ data environment," Bonner writes, noting it always wants to monetize content via Go90, AOL, Yahoo and its other alliances.
"However, it remains unclear how the company will monetize its new services, and how quickly it will be able to generate results. Management’s silence about Go90 also suggests that this business may be underperforming."
The company's note about unlimited plans mitigating subscriber losses "masks the migration of subscribers from higher-value postpaid plans to cheaper prepaid plans. A 6% decline in average revenue per account (ARPA) tells the tale of this customer migration as well as of lower overage fees from the ‘unlimited’ plans."
Now read: Is Verizon Cornered? »