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CUSTOMER RELATIONSHIP MANAGEMENT NEWS. UPDATED 13 MINUTES AGO.
You are here: Home / Sales & Marketing / Verizon Will Drop New Phone Credit
Verizon Will Drop 'New Every Two' Credit for Phones
Verizon Will Drop 'New Every Two' Credit for Phones
By Barry Levine / CRM Daily Like this on Facebook Tweet this Link thison Linkedin Link this on Google Plus
PUBLISHED:
JANUARY
13
2011
Welcome, iPhone. Goodbye, "new every two" credit. Those appear to be the transitional greetings at Verizon Wireless, which is getting ready for big sales on Apple iPhones -- in part by quietly canceling a program that offers a credit for a new phone under a two-year plan.

Next week, the popular "new every two" deal will end. Under that program, existing customers get a credit of $30 to $100 off a new phone after 20 months of a two-year contract have been completed. The credit could also be transferred to another line of the same account. The discount applies to the discounted retail price of the device, and will end as of Jan. 16. Current "new every two" customers can obtain their credit, but won't be allowed to re-enroll.

Initially Offered

On Tuesday, Verizon confirmed the long-standing rumor that it will offer Apple's iPhone, beginning in February. AT&T has been the exclusive carrier in the U.S. for the popular smartphone.

When the iPhone deal was announced earlier this week, Verizon initially said that customers could use the "new every two" credit toward an iPhone.

Thus, the end of the "new every two" credit comes just before Verizon's expected wave of iPhone sales. The iPhone price for customers with a two-year contract is listed as $199 for the 16GB device, and $299 for the 32GB version, essentially equal to AT&T's offering.

Without the carrier's subsidy, the 16GB iPhone would cost $599. Carriers commonly subsidize the cost of the devices, and Verizon's "new every two" credit was an additional price break.

However, the regular subsidy applies to any customer, new or old, while the "new every two" credit required a customer to have been with Verizon for at least 20 months.

'Design Compromises'

The Verizon iPhone has been adapted for Verizon's CDMA network. Apple said it has been working on an LTE iPhone for Verizon, which would take advantage of the carrier's new 4G network.

But Apple COO Tim Cook said at the Verizon event announcing the iPhone availability, "the first-generation LTE chipsets force some design compromises, some of which we would not make." He added that Verizon customers have been requesting that the carrier offer the phone now, not later.

The Verizon iPhone does have a few differences from AT&T's. While the Verizon iPhone won't let customers talk on the phone and browse the web at the same time, as the AT&T phone does, it will allow owners to use the device as a wireless hot spot to offer data connections for as many as five other devices. This latter capability is something the AT&T phone doesn't yet have.

Some industry observers are suggesting that Verizon's new stinginess with credits will be reflected at other carriers. The thinking is that all the major carriers are going to be looking for more revenue to support the rollout of their new 4G networks and the costs of handing the heavier data traffic from more smartphone users.

Tell Us What You Think
Comment:

Name:

Diane:
Posted: 2011-01-20 @ 1:34pm PT
The two year deal is the main reason I stuck with Verizon. Other companies have better, less expensive plans. See ya Verizon!

Doug:
Posted: 2011-01-18 @ 7:59am PT
I don't mind losing the discount as long as I don't still have the 2 yr commitment with early termination fee. VZ can't have it both ways. If I pay full price, I want an unlocked phone.

Dave:
Posted: 2011-01-17 @ 8:24am PT
Other countries have cheap cell service but you pay full price for the phone. Here we have always paid a bit more per month but got a cheap price on the phone. Now we have outrageous monthly prices and pay alot more for the phone. Many people no longer have home phones and now the phone companies are going to rake in money.

Michael:
Posted: 2011-01-14 @ 2:36pm PT
If my discount goes, so shall I. I have liked my Verizon for years but I wont lose what was a feature I signed on for originally.

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