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Verizon will start restricting LTE speeds for its heaviest unlimited-plan customers

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Verizon Wireless(s vz) has been trying to coax its remaining unlimited data customers onto its tiered plans for years, and starting this fall it’s providing one more disincentive to remain with its grandfathered all-you-can-eat plans.

On October 1, Verizon will start throttling back LTE speeds on its heaviest unlimited-plan subscribers when they move into congested cells on its networks. What that means is that when the network gets crowded, Verizon will prioritize 4G customers who buy their data by the gigabyte over unlimited plan customers who fall into the top fifth percentile of monthly data usage.

As of today, the top five percent consists of customers who use 4.7GB or more of data each month, though that number will fluctuate month-to-month as traffic patterns change.

Source: Shutterstock / Max Krasnov
Source: Shutterstock / Max Krasnov

Verizon launched the same policy, called Network Optimization, in 2011 for its 3G unlimited plan subscribers, but at the time it claimed to place no restrictions on its LTE network. A lot has changed since 2011, though. Back then LTE devices were a minority, but today they account for 54.5 percent of the devices on Verizon networks, and 76 percent of Verizon’s data traffic traverses its 4G networks.

Verizon is in the final stages of a massive LTE upgrade, doubling or tripling 4G capacity in 350 markets and relieving its original LTE network of the increasing congestion it was seeing in major cities. Verizon’s new networks are currently capable of handling subscribers’ growing demands, but Verizon decided to implement the new 4G policy this year in anticipation of future demand, a Verizon spokesman told me.

Verizon was also quick to point out that relatively few customers will be affected by the policy, and even those who are will see their speeds restricted under relatively few circumstances. Verizon isn’t, for example, implementing a hard or soft cap and then throttling back down to 3G or 2G levels for the remainder of a billing period any time a customer hits it.

Instead, it’s using policy engines to determine when a cell is seeing heavy used and then queuing its customers based on different priority levels. If a cell is uncongested, all customers will have full access to the cell’s bandwidth no matter what kind of plan they are on. If there are, say, 20 users in a cell, throttled users may find their speeds cut by a few megabits.

The more people are trying to access the same cell, the more likely Verizon's new throttling policies will kick in (source: Shutterstock / higyou)
The more people are trying to access the same cell, the more likely Verizon’s new throttling policies will kick in (source: Shutterstock / higyou)

But if a cell is really congested with hundreds users vying for bandwidth — say in downtown Manhattan during rush hour — an affected user might find his or her speeds cut back to dial-up levels. Under such circumstances, nobody would get a solid connection, but subscribers who fall under the throttling policies would see the worst bandwidth.

Verizon said that its new policy will only apply to customers who have fulfilled their contract terms (so if you renewed your data plan under contract in the last two years, you’re safe). The policy remains in effect for a subscriber for the entirety of a billing period. If you’re still in the top 5 percentile of users at the end of that month, then the throttling policy continues for another billing period. But if you’re not, then all restrictions are lifted – at least until your next bill.

Verizon plans to start notifying unlimited plan customers who could potentially be affected by the policy in the first week of August. Training documents about the policy shift, however, leaked to Droid Life on Thursday.

Verizon's LTE coverage in dark red
Verizon’s LTE coverage in dark red

Clearly Verizon’s unlimited plan customers are not going to be happy about this, considering many of them have jumped through years of hoops to maintain their unlimited status on Big Red’s network. I’m sympathetic, but it’s also pretty clear Verizon doesn’t want unlimited data users on its network. While it’s not forcing customers off of those plans, it keeps introducing policies that make it more difficult or less desirable to maintain them.

Meanwhile T-Mobile(s tmus), Sprint(s s) and many virtual operators are embracing unlimited data. While they may not have the coverage of Verizon, their networks are readily available in the big cities where Verizon’s new throttling policies are most likely to apply. If a truly unlimited data spigot is important to you, maybe it’s time to switch.

29 Responses to “Verizon will start restricting LTE speeds for its heaviest unlimited-plan customers”

  1. Dallas Thunder

    If we have the unlimited hotspot feature, I wonder if we will be affected by this? I assume yes, but would think we could be “bypassed” as that’s the intention of the hotspot feature.

  2. I work for a comunications company who uses vzw. We have hundreds of cell phones and just relized that my 4g connection is gone. We are paying for top quality service and not getting it. This is wrong, wireless service has little maintenance to it so 90% of your bill goes in someones pocket.

  3. Verizon Wireless is a business and still in my opinion the best wireless provider in the US. I am one of those top 5% users on the unlimited plan. Verizon contacted me recently and offered me a free new phone to move to their XTLE network for free (not including taxes). This included no contract changes. It was just to move me to the less congested XTLE network to help minimize the congestion. I get amazing speeds from their network and would not be surprised to see throttling during peak times on the LTE network. They still handle it a lot better then companies like AT&T and Comcast.

  4. sodaker

    I live in Sioux Falls SD (150,000+). Verizon brought 4G LTE to town over 3 years ago. AT&T is still working on it. Sprint and T-Mobile are lucky to be able to give you 2G in town and heaven help you if you stray off the interstate. I guess I will see how bad the throttling gets.

  5. I live in a medium size city with a population around 200k. I wonder if I would fall under the “big city” restrictions and guidelines where the throttling will mostly take place. Btw, I’m up to 40GB for the month with 13 days left in my billing cycle.

  6. There is no good reason for data limits like these. Sure data limits are good, but they should be 10 times the amount they currently are. Now even land line connections have limits too! The greed is getting out of control!!!!

  7. Christopher Price

    Keep in mind, you can use Verizon’s pervasive CDMA voice and data coverage for dirt cheap via Page Plus Cellular. T-Mobile offers a $30/5GB data plan with no throttling.

    Based on my usage, I’d be throttled at the same time (assuming “congestion” on Verizon’s network – which is pretty much all the time in my area). But, my bill would cut in half by using Page Plus for voice and T-Mobile for data.

    Since I use more than 5 GB of data, I’d probably opt for T-Mobile (or Sprint) unlimited and Page Plus for backup voice coverage – all routed through one Google Voice phone number.

    It’s been fun, Verizon. But Sprint and T-Mobile offer true unlimited… gotta vote with my wallet.

  8. Christopher Price

    Verizon must let people out of their contracts due to a material change of service. Thanks to upgrade transfers, I have three unlimited data lines under contract. Has Verizon stated when the cancellation period is – next billing cycle or Oct 1-30 when the change takes effect?

    • Kevin Fitchard

      Hi Christopher,

      Actually the new policies don’t apply to unlimited plan customers currently on contract. So you presumably won’t be seeing and imposed restrictions on your data speeds until your contracts expire.

      • Christopher Price

        Interesting – thanks for clarifying, wasn’t sure if that applied to upgrade transfers. Theoretically, you can still do that since Verizon hasn’t sent formal notice to customers (that has to happen in the next month’s bill)… that would bump your throttle date out two years.

    • dustin erwin

      Your contract doesn’t guarantee any particular speed. They are legally not obligated to let you out of your contract based on data throttling

      • Christopher Price

        @Dustin – Any “material change” to your service however is CTIA Code of Conduct grounds for a waiver of ETF. Most would view a new throttling policy to be material, as would just about any court in the land. That is apparently why Verizon is waiving the throttling for people under contract.

  9. Guest1

    They have plenty of cellular (800Mhz) and PCS (1900MHz) licences, used only for CDMA. Come on; it’s 2014. Let go of that stupid slow thing and use the spectrum for more LTE. If Verizon could only grow the balls to refarm their ever-so-precious licenses, there’s no need for throttling or “restricting”.

    • Christopher Price

      It’s not that simple. Verizon has wholesale contracts on CDMA and it would require two additional LTE bands on the device. VoLTE has to happen before any of that happens… and preferably with a 3GPP protocol so we aren’t carrier-locked into specific devices because each carrier has its own VoLTE standard.

  10. joe mama

    I’m usually the last one that says “we need a law”, but maybe we need a LAW like Germany has where they MUST provide coverage to 100% of the country. I am in rural NE Texas and so sick of ZERO cell coverage from ANY provider, ZERO DSL, ZERO fiber, ZERO cable modem and only one WISP provider with SLOW service. They have a CASH COW on wireless just raking in money in “high density areas” and because of PURE GREED, I have to suffer and place my family in danger if they break down on the side of the road.

    • Kevin Fitchard

      Hey Joe, I would figure NE Texas (Tyler, Texarkana area, right?) wouldn’t be so bad. It;s a more densely populated area of Texas (compared to the Panhandle and Big Bend at least). I feel for you though if your options are that limited. I mean it’s not like you’re in the middle of nowhere.

    • Dustin Erwin

      No because you choose to live in the middle of nowhere you get no service. Verizon and all other carriers are businesses. They are in it to make money. It cost millions of dollars to put up a new tower. It isn’t cost effective to spend millions of dollars on equipment to serve a few people. All carriers are going to service higher populated areas first

  11. Reblogged this on Taste of Apple and commented:
    As an unlimited Verizon customer, I am definitely not happy about this. The moment they force me off of unlimited data, I will choose a cheaper (and admittedly less reliable) carrier. This is yet another cheap tactic to push people off unlimited data and into a tiered data plan. “Congestion” is a poor excuse for throttling. They should build out their network instead of making excuses for trying to gain more money from customers.