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Verizon Wireless plan sticks some with unwanted Internet fees

Lori Yonan wasn’t looking for anything fancy in a new cell phone. The decade-long customer of Verizon Wireless wanted to start texting with her children and got an LG enV phone that has a full keyboard to make it easier to tap out messages.

But Verizon told her that in order to upgrade to a Web-enabled “feature” phone, she would have to pay $10 a month for Internet data charges she didn’t plan to use. To that, she balked.

“I’m in front of a computer all day so I don’t need Internet on my phone and I don’t want to be forced to get it,” she said, adding, “especially in these harsh economic times.”

Yonan, who lives in Cerritos, Calif., is among an estimated 3 million or more customers who will get billed an extra $120 a year in data charges as part of Verizon’s new pricing scheme, according to some analysts. The Federal Communications Commission is looking into consumer billing and transparency in the way wireless firms charge for services as part of a bigger investigation into competition in the mobile industry.

The company announced a new flat rate plan, matched by AT&T two weeks ago, that knocks off $30 from monthly voice calling plans to $70. And unlimited voice and data plans were reduced to $100 from $130.

But also as part of the price changes, Verizon customers with phones that can connect to the Internet (most phones now have Internet browsers) must also get a $10 a month data plan that gives up to 25 megabytes of data use. They can also get unlimited data use for $30 a month. Only Verizon has announced the mandatory data fee.

Verizon spokeswoman Melanie Ortel said the company decided to mandate the data fees to “streamline” its pricing schemes. She said customers were accessing the Web on their phones and going over allotted plans for Internet access. They wanted a basic data plan to help prevent them from overage charges, she said.

But what of customers like Yonan? She is one of among millions of cellphone users who want greater functionality on their phones without having to pay for the costs of additional services they don't plan to use.

Joel Kelsey, a policy analyst at Consumers Union, the publisher of Consumer Reports, said the policy change will affect users of a growing segment of mid-range phones that have some advanced features beyond basic voice functions but don’t have the same number of Internet applications as Apple’s iPhone and Research in Motion’s Blackberry.

“The market for wireless services has skyrocketed to 84 percent of the population but the majority of those folks are using wireless voice and text plans only,” Kelsey said. “The biggest gripe among users is that it’s just too expensive for high-end data plans.”

By Cecilia Kang  |  January 26, 2010; 7:15 AM ET
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This fee is nothing more than a rate hike for most customers while the more publicized reduction in the cost of monthly calling plans only effects those who need unlimited calling minutes. I e-mailed to Verizon to voice my concerns about this a week ago and have heard nothing back. I will be shopping for a new carrier when my plans expire next fall.

Posted by: wwat | January 26, 2010 8:20 AM | Report abuse

Count me as one of those Verizon prisoners who is counting down the days until my contract ends. I got them because they had the best network coverage around DC but most of the others have caught up so I'm getting out.

Posted by: KS100H | January 26, 2010 8:51 AM | Report abuse

When I needed to replace my broken Verizon phone in December, I came across this new data plan wrinkle. At that time, not every phone required the data plan. The LG env touch did, but the LG env 3 did not. If they've further changed their policy, that stinks, otherwise I think you can still get certain phones with full keyboard and avoid the data charge.

BTW, I just got a refurbished version of my broken phone.

Posted by: wwc4g | January 26, 2010 9:10 AM | Report abuse

This is so outrageous. I am almost beside myself with wrath.

The problem with abandoning Verizon is that their network is so head-and-shoulders superior to anyone else's that it is difficult to turn elsewhere and receive anything even remotely approaching the reliable telephone service that Verizon customers are accustomed to enjoying. I mean, old Cingular's ads (false advertising, by the way) about "fewer dropped calls" failed to reach Verizon customers entirely, because our reaction was "What's a dropped call?"

Because we have Verizon FiOS TV, landline phone and Internet, and also Verizon Wireless (who maintain some sort of weird fiction that they are a separate entity), and we own our home and cars outright, our Verizon bill is the largest monthly bill we face in any given month. We really don't want it to get any larger.

But this particular charge is completely unjustified. I don't use my phone as a computer -- I use my computer for that and I already pay Verizon a pretty penny each month for its Internet connection. But since the Citizens United decision was handed down, what Senator or House member will dare to risk Verizon's ire, what with their endlessly deep pockets, by standing up for the consumer?

Posted by: FergusonFoont | January 26, 2010 9:16 AM | Report abuse

Verizon, AT&T & T-Moble have a history of selling or rather billing you for things you don't want or need. When AT&T released the iPhone and to this day, you have/had to get their data/internet packet regardless of whether or not you planned to connect to the internet or not. It was and still a requirement. I have been successfully using my iPhone for 1 year now with no internet connectivity. How? I bought a used iHpne with no contract and popped my SIM in it and did not notify AT&T. I can connect to the internet for free when at home or a free Wi-Fi location.
T-Mobile charges you for their data package if you buy a Blackberry or similar smart phone regardless if you want internet connectivity. If you have a non smart phone that could connect to the internet such as a Motorola Razr, they used to offer a $5.99 TZones 500mb a month data package which worked quite well on a unlocked iPhone and unlocked Blackerry. Then T-Mobile started identifying the handset using it's IMSI and if you had/have an Blackberry, iPhone or another smartphone, they would change your $5.99 TZones feature to the $19.99 Smartphone Access. They claimed this was to allow the smartphone better web surfing capabilities/more bandwidth but they lied. I went to the same exact sites and they took the same time to load and looked exactly the same. I used the same amount of bandwidth when I checked my usage. 500mb a month is 500mb a month regardless of what kind of handset you have. T-Mobile just gouged their smartphone customers because they could. Further, T-Mobile tried to impose a $1.50 a month charge for receiving a paper bill. Not a detailed bill but a standarg paper bill. They wanted people to go green and receive bills sent electronically via the web. In other words, you could still get your bill for free if you allowed them to email it to you but anything in paper mailed to you was going to cost you. I think they nixed the idea but I was fully prepared to contact the FTC and the Maryland Attorney General's Office if I had to pay to receive a monthly bill. Verizon has had a long history of nickle and dimeing their customers. Although they have the best network, you pay for it. When I was shopping for a new plan, you had to pay to transfer your pics off of your phone to a PC via email. Because Verizon controls the handset manufacture's software, you couldn't just plug the handset to your PC with the supplied USB cable and download the picture. Verizon removed that functionality the handset's software. With them, you have pay to play. I can't wait for Cricket and others to get good coverage so I can get everything I want or need at reasonable prices.

Posted by: neil64 | January 26, 2010 9:31 AM | Report abuse

My wife & I ran into this when we decided to upgrade to new phones. We ordered our phones online at the suggestion of the Verizon store sales reps. We did this on Sunday 17 Jan. At first we tried to get the LG ENV Touch, but eventually discovered the hidden data package. We called their customer service and specifically asked which phones do NOT require the data package. They told us the LG ENV 3 did not. However, the new "tiering" (as the VZW reps call it) went into effect on Monday 18 Jan. The customer service rep did not tell us this! So when we got our new phones arrived on Tuesday 19 Jan, they tried to charge us for the data package! We did finally get everything sorted out by escalating the situation. Sadly, the VZW folks all were aware of the "tiering" but they keep these fees hidden until you are finalizing your contract or activating your phone. They hope you won't notice the extra $120 / year / phone. Buyer beware!

Posted by: brownah | January 26, 2010 10:01 AM | Report abuse

My wife wanted an EnV, so we upgraded her phone the Friday before the new pricing policy went into effect. That allowed us to avoid the mandatory $10 fee -- for now. If we wind up changing plans or her phone, we'll likely get stuck with it.

Posted by: clvande | January 26, 2010 10:21 AM | Report abuse

Not that I'm defending the company here, but you can stick with your current phone/plan and you will not be charged the additional fees. You only get the mandatory $10 data charge when you upgrade to that type of phone - web enbled phone.

Posted by: chass80 | January 26, 2010 10:55 AM | Report abuse

People who receive employer discounts should also be aware that some of those discounts can not be used on Verizon's new Pricing Plan. For example, I have a Blackberry and I am on their $79.99 900 minutes voice with unlimited text plan and $29.99 data plan. I get a 20% access discount and a 20% feature discount. On their new pricing structure I would be paying $69.99 for unlimited voice but I would pay $20 extra for unlimited text plus $29.99 for my data plan. I would only receive my 20% access discount.

So, I would be paying $10 more per month and would lose my 20% feature discount.

This new pricing structure is a sham. People should really investigate all the nuances involved before signing up for it.

Posted by: daphy9551 | January 26, 2010 11:03 AM | Report abuse

After 8 calls and a lot of complaining, someone FINALLY found the loophole (which they will not offer to you, you have to ask). Ask them to have the dashboard blocked, but to make certain they reinstate the photo texting feature. They'll say it's impossible, but someone just figured it out for me. Call corporate if they give you a hard time, and let them know that you'll be reporting your results back to the Washington Post.

Posted by: bradyb | January 26, 2010 11:53 AM | Report abuse

Verizon is the most expensive and greedy company in the business.

Posted by: citigreg | January 26, 2010 11:58 AM | Report abuse

We were looking at upgrading our phones at Verizon Wireless as our existing ones are starting to fail. We are on an older plan (300 minutes $35/month + $20 for second line) that is plenty good enough for what we use them for. Unfortunately, in order to get an equivalent phone in features we were told that we have to upgrade our phone plan to one of their current plans (the lowest being $59/month for 500 minutes). If we wanted to keep our plan as is we were given a choice of 3 cheap phones that didn't have near the quality of our previous phones. Even phones that didn't have the web features were disallowed from being used with our plans. There is no technical reason any of the other phones won't work with our plan. Verizon has set up their plans by policy to get squeeze more money out of us. Alternatively, we could get a phone with the $10/month data charge added on. Either way they are trying to force more money out of us.

When my plan expires I will probably switch to another network. That's the only way to express my outrage at them for trying this stunt. I still may end up paying more money, but I don't have to give it to the same people who try this kind of stunt on their existing customers.

Posted by: sauron | January 26, 2010 12:04 PM | Report abuse

i worked for what became att and verizon wireless (which is a joint venture involving verizon and vodafone) for the last nearly two decades of my career. there is a simple option for those concerned about a fee associated with new/upgraded phones. just say no. after i retired i bought a boost mobile phone-and have replaced it a couple of times and i pay $50/mo. while intrenet access it available on the phone i have now, i don't use it and i don't text enough that i am inconvenienced by not having a special keyboard. it is a simple solution like not ordering a price fixe meal when you only want a salad. avoid the teenage/first adapter urge to have the latest and greatest handset and you are all set.

Posted by: george32 | January 26, 2010 12:05 PM | Report abuse

Ever since I have been with Verizon they have practiced a policy of increasing charges every year - often by charging for services or features that I did not need –e.g. Internet access, more minutes. I love the reason given by the Verizon rep for this latest charge - “They wanted a basic data plan to help prevent them from overage charges, she said.” My overage charges amount to less than $2 a month for my kids. I don’t need a $10 charge to cover that. I would not mind using the internet once in a while, but I do not have a plan and the costs are outrageous –I spent 5 minutes surfing and because I have a Smartphone, I was billed for $20. They now force you to get a $30 data plan with a Smartphone. I like the advanced features of a Smartphone (like being able to read the screen), but I do not need internet access.
Because of the way I am squeezed by Verizon on my phone, I will NEVER move to Verizon FIOS. I do not trust Verizon. In Verizon’s favor is their reliability and the fact that I can’t do much better on price – I have a family plan and 5 phones. Other carriers are equally expensive, so I will stay with Verizon for now. I will change as soon as I find a better price elsewhere.

Posted by: jim3536 | January 26, 2010 12:59 PM | Report abuse

Verizon's mandatory data charge is just another example of the American Telecomm industry’s anticompetitive collusion. Congress is investigating and must impose harsh penalties. Home internet data is much cheaper than celtower data and can be purchased from a different company than one’s cel service provider. When celphone telecomm companies conspire to disable their phones’ built-in connectivity just to force customers onto overpriced celtower data plans, that is a clear antitrust violation and Congress should impose punitive and regulatory sanctions. Verizon and AT&T collude with Apple and Microsoft to deprive phone users of reliable free Wifi functionality. No hardware manufacturer or software developer should be allowed to tie up with a service provider to deprive the user of data interconnectivity. We should be able to buy any phone and choose any celtower data service based on competitive pricing. "Locking" a phone should be made illegal and even criminal. The internet’s technical goal has always been interoperability and cross-platform compatibility, but the telecomm companies actively collude to prevent competitive phone interconnectivity. Congress should fine them heavily.

Posted by: Religulous | January 26, 2010 1:18 PM | Report abuse

We got tired of Verizon's business practices and switched to ATT a year ago. I probably lose 4 calls a month. It's a small price to pay for self-esteem, and I pay less. I'd never go back.

Posted by: gbooksdc | January 26, 2010 2:35 PM | Report abuse

And the award for "Entrepreneurial Extortionist of the Year" goes to........Verizon Wireless!!!

Posted by: Bushwhacked1 | January 26, 2010 4:56 PM | Report abuse

We've had AT&T and Cingular for going on 10 years now. Except for the fact that I can't get calls underground on the Metro, I've been happy. The dropped calls are just a part of the reality of life with AT&T, not that I get that many.

We were on Verizon FiOS for data, voice and tv. From a technical point of view, it's a great service, head and shoulders above Comcast. However, Verizon's business practices drove us back into Comcast's arms. Until Verizon changes there tune, I'll be staying with non-Verizon vendors,

Posted by: JoStalin | January 26, 2010 4:57 PM | Report abuse

Cellular companies are getting just like credit card companies, creating endless ways of sucking money out of customers' pockets. I left TMobile after being lied to - I temporarily needed to upgrade to more minutes from my low minute plan and they told me I could go back to my old plan later - a lie which resulted in my giving up a very affordable low minute family plan. Now no one offers a low minute family plan, and the per diem charge that accompanies the pay-as-you-go charge ends up costing as much as a full-blown plan. I went to Verizon from TMobile and got hit with a data charge when I didn't even download anything. I went searching for new ringtones, didn't find one I liked, but got tagged for a full mb of data usage. I will be looking for an alternative when my contract expires.

Posted by: lok55 | January 26, 2010 9:13 PM | Report abuse

Question for husband and I are in a similar situation as my enV2 is now non-functional and we are eligible to upgrade our phones. We intended to get the enV3 because I loved my enV2, but as of the 18th you cannot get the enV3 without the mandatory $10/month internet package (which is per phone, so my husband and I are looking at an extra $20/month for a service we don't use or want). The only alternative is to get one of the three flip phones they offer, or they have one with a keyboard that my 10-year-old has and is essentially a toy. We are curious as to how you had your problem resolved. We have been told that there is absolutely NO WAY around the $10 per phone per month charge if you activate the phone after the 18th. Did they find a way around it for you? We would be most appreciative if you or anyone else who has had any luck with this would share how you did it. Thank you!

Posted by: lotsodrama | January 28, 2010 2:02 PM | Report abuse

Response for lotsofdrama:

After 8 calls and a lot of complaining, someone FINALLY found the loophole (which they will not offer to you, you have to ask). Ask them to have the dashboard blocked, but make certain they reinstate the photo texting feature. They'll say it's impossible, but someone just figured it out for me. Call corporate if they give you a hard time, and let them know that you'll be reporting your results back to the Washington Post:).

Posted by: bradyb | January 28, 2010 6:09 PM | Report abuse

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