Decreasingly a factor in the pay TV industry in recent years, Verizon has declared disruption on what’s left of its dominant hegemony.
The No. U.S. wireless operator today announced a fundamental way in which it bundles its wireline Fios services, allowing customers to choose internet, TV and landline phone services a la carte, and ostensibly eliminating hidden fees and contracts in the process.
The so-called “Mix & Match” model lets consumers pick from three internet speeds: 100 Mbps for $40 a month; 300 Mbps for $60; and 1 Gbps for $80. No contracts are required.
For video, customers can subscribe to Verizon’s virtual pay TV partner, YouTube TV, and get a month free of the $50-a-month service.
In terms of Fios TV, Verizon is now offering a “test drive’ of its full 425+ channel bundle, allowing customers to pay $50 a month for two months, plus $12 a month per set-top. Once that two-month trial is over, Verizon said it will “recommend” what video package its customers should settle into permanently.
One option is the “Your Fios TV” bundle, which includes around 125 channels for $50 a month (plus $12 per month per set-top). Subscribers, however, can choose the five cable networks they absolutely have to have. Local access to major broadcast networks are included in all bundles.
For $70 a month, customers can get the “More Fios TV” bundle, which features around 300 channels, including regional sports networks, and waives the $12 charge for the first set-top.
The Full Monty is the $90-a-month “The Most Fios TV” package, which is includes more than 425 channels, one set-top gratis and a $12 DVR service credit.
“Customers have been loud and clear about their frustrations with cable, and we’ve listened. As a result, we’re transforming our approach to Internet and TV offers by giving customers more choices and more transparency,” says Frank Boulben, senior VP of consumer marketing and products at Verizon, in a statement. “Customers are tired of having to buy a bundle with services they don’t want to get the best rates, and then discover that those rates didn’t include extra fees and surcharges. We’re putting an end to the traditional bundle contract and putting customers in control.”
Beyond DVR service and set-top leasing fees, there’s no mention on Verizon’s new Mix & Match pricing grid about things like broadcast retrans or regional sports network fees.
Consumer Reports put out a statement lauding Verizon for the strategy.
“Finally, a major cable company has gotten the message,” said Jonathan Schwantes, senior policy counsel for Consumer Reports, seemingly unaware that Verizon is not a cable company. “Consumers are fed up with paying hundreds of dollars in extra fees each year that weren’t always clearly disclosed when they signed up for service. While the cost of internet and cable TV service is still expensive, Verizon customers can now pick a plan that suits their needs and budget without having to worry about getting hit with a bill loaded with hidden fees.”
