It’s official.  Verizon Wireless will welcome Apple’s iPhone to its network next month, but in a glaring omission, company officials refused to discuss data pricing for the all-important data plans that will power the wildly popular smartphone.

The official announcement of the iPhone on Verizon came late this morning in New York at a press event hosted by Verizon’s president Lowell McAdam.  Joining him was Tim Cook, Apple’s chief operating officer. Neither Steve Jobs or Verizon CEO Ivan Seidenberg were on hand for the event.

“Late in 2010 we started offering the Apple iPad and today we are extremely gratified to announce that the iPhone 4 will be available early next month,” MacAdam said. “Our relationship with Apple has developed over the last two years. Back in 2008 we started talking about bringing the iPhone to a CDMA network, and we spent a year testing.”

“All of Apple is very excited to bring the iPhone to Verizon’s customers,” added Cook.

The new phone will be available for pre-orders, exclusively for existing Verizon Wireless customers Feb. 3.  A week later, anyone can reserve the Verizon iPhone at Verizon Wireless or Apple stores, or online.  The new phones will cost $199 for the 16GB model, $299 for the 32GB model with a new two year contract.  The phones will work on Verizon’s 3G network, but not on their new LTE/4G network.

Verizon is so confident its network can handle the traffic, it is bundling, for free, a mobile hotspot with the phone that will allow up to five devices to share the iPhone’s 3G connection over Wi-Fi.  That means you can use a laptop or home computer with a wireless card and connect to Verizon’s 3G wireless broadband service without any additional equipment.

But Verizon’s press event left some questions unanswered, starting with whether the company would sell unlimited data plans to accompany the phone.

“We talked about the device pricing, but we’re not going to talk about the pricing for the network for that connectivity,” Verizon Wireless CEO Dan Mead said. “We’ll have announcements in the future.”

Another downside: the Verizon iPhone will not be able to multitask.  If you make or receive calls on your phone, your data connection is suspended for the length of the call.  This is common on CDMA cellular networks, and it currently affects other smartphones used on Verizon’s network as well.

As far as Apple sees it, that isn’t much of a problem so long as the phone works on Verizon’s network.

“I can tell you that the number one question I’ve gotten is when will the iPhone work on Verizon,” said Cook. “I couldn’t be happier to tell people that. They will make those sorts of trade-offs.”

[flv width=”576″ height=”344″]http://www.phillipdampier.com/video/AP Verizon to Start Selling iPhone Early Feb 1-11-11.flv[/flv]

Lowell McAdam makes the official announcement.  (2 minutes)

Media excitement about recent iterations of allegedly “4G” networks aside, no currently available wireless broadband service will replace the need for traditional wired broadband so long as providers limit consumption to 5GB (or less) per month.

As average consumption per household is now at least three times that level, wireless broadband customers will be faced with three choices:

1. Supplement a wireless broadband account with an unlimited, wired broadband service;
2. Be prepared to pay overlimit fees or purchase additional accounts or “usage packs;”
3. Reduce usage to remain within plan limits.

Sprint currently remains the largest carrier offering unlimited access to its 4G network, also sold independently under the Clearwire brand.  But as Clear subscribers found out, “unlimited” comes with “unlimited hassles” if Clear’s “intelligent network management” software catches you using it “too much.”  Speeds are quickly throttled downwards, well below even Sprint’s slower 3G network.

Many of Clear’s customers signed up in response to ads promising the 4G wireless service as a “home broadband replacement.”  Ditch your cable modem or DSL service for a wireless alternative!  Some salespeople even dared to suggest Clear was faster than cable or DSL.  Only for most it is not.

Every carrier has their own version of “4G” here or on the way, most of which can deliver better and faster service than the 3G alternative, but wireless providers are hellbent on ensuring customers never get used to the concept of truly unlimited service.

Glenn Britt, CEO of Time Warner Cable, admits the wired broadband industry erred when it got people used to all-you-can-use broadband.

“We made a mistake early on by not defining our business based on the consumption dimension,” Britt told investors back in 2009 when the company was contemplating its own metered usage trials.

4G networks can bring out the "data hog" in everyone if you actually take advantage of the faster speeds to stream multimedia.

Wireless providers are working hard not to repeat that mistake.

AT&T found usage caps anger customers, but got away with implementing a 2GB monthly wireless usage cap tied with the introduction of the wildly popular newest iPhone (and helped by grandfathering existing unlimited customers until their next phone upgrade.)

“If I had a baby in my hand and my iPhone and I had to drop one, I’d drop the baby,” laughed Dallas iPhone owner Luisa Benton.  But Benton’s love for her Apple phone does not extend to AT&T’s network, noting she has dropped calls and had poor reception in certain areas.

Many iPhone owners retain their cable or DSL broadband service because AT&T’s wireless usage cap limits what they can manage online, and the company’s network problems only adds insult to pocketbook injury.  With many locked into two year contracts, few are going to brave early termination fees to find an alternative.

As providers upgrade their networks, they are also upgrading their prices.  Verizon’s new LTE network, for example, carries a premium price tag for those wishing to use it.

Customers looking for a faster wireless experience will pay $50 for 5 GB or $80 for 10 GB of data on Verizon’s new network.  Run over those limits and an overlimit fee of $10 per gigabyte kicks in.

“People are never going to use wireless networks the way you see them on the commercials,” writes Stop the Cap! reader Jo-Anne in Seattle.  “They are always watching movies or TV shows — services you absolutely don’t want to risk at those prices.”

J0-Anne asked a Verizon representative if new 4G smartphones would be permitted to use unlimited data plans.

“‘Don’t bet on it,’ was the reply I got — Verizon may keep unlimited around for 3G network users only,” she said.

If true, Verizon will deliver overpriced, inadequate service for any customer looking to leave their home broadband account behind.  As soon as multimedia gets involved, usage caps rapidly become a dealbreaker.

Verizon recently contracted with Bridgewater Systems Corporation to supply it with data management software.  Bridgewater is also a major supplier of network throttling solutions to ferret out heavy users and impede their speed, as part of “fair use policy” regimes.

Some wireless companies are trying to have their cake and eat it too — selling “unlimited” wireless broadband service hampered by an aggressive “policy control” network management scheme.  You’ve seen the ads promising unlimited access, but probably missed the fine print warning the provider will throttle your wireless broadband speed to something comparable to dial-up once they deem you a data hog.

Cricket and Clear are both notorious for throttling customer speeds and delivering disclosures of the practice more impenetrable than North Korea.

A Clear blog entry tried to simplify the legalese:

During times of high network utilization our network management system may limit speeds, but we never limit the amount of data a customer with an unlimited data plan may use. The algorithm in place reviews several factors including long and short-term usage, current network capacity, and network demand to determine if network management needs to be applied.

The end result is that a few heavy users temporarily give up some speed during limited times of high demand so that everyone can have a good experience. A majority of customers are having a positive experience and experiencing faster speeds during times of greatest demand since these enhancements were enacted.

The “positive experience” Clear’s blogger reports may be wishful thinking, however, after reading the company’s support forums.  They’re overloaded with thousands of angry customers and probably many more ex-customers.  An “unlimited” broadband experience is meaningless if customers endure speeds well below the minimum acceptable definition of “broadband,” often for days on end.

Cricket is no better:

Cricket sets usage levels on the amount of data a customer can upload and download within stated periods of time. If you exceed your rate plan usage levels, Cricket will temporarily reduce the speed at which you can send and receive data over the Cricket network. You will still be able to use the service but your speed will be slower. Cricket may use other traffic management and prioritization tools to help ensure equitable access to the Cricket network for all customers. Your service speed is not guaranteed and is subject to this Fair Use Policy.

Cricket has set a data usage level (“Usage Level”) per customer. As shown in your rate plan brochure or on www.mycricket.com, this Usage Level varies based on the rate plan you’ve selected. Every day, we measure your upload and download data usage (“Actual Usage”) to determine if your total Actual Usage, as aggregated over your bill cycle (“Usage Total”), exceeds the Usage Level for the rate plan you selected. During hours of operation, you can inquire about your Usage Total versus your monthly Usage Level by calling 1-800-Cricket and speaking with a Care representative.

Once you begin a new bill cycle your rate plan Usage Level upload and download speeds will be restored.

The average Cricket customer is unlikely to grasp anything beyond the fact their speed sucks if they are targeted by Cricket’s throttle.  It’s not as simple as breaking through your monthly usage allowance.  Cricket can and does throttle customers who seem like they could exceed the limit, based on their daily account activity.

In the end, most wireless customers pay more for less service.  The primary benefit is portability, and carriers consider that worth the premium prices charged.  But as the Internet’s love affair with all things multimedia continues, none of these providers will provide a suitable alternative to the traditional home-wired broadband account.

[flv width=”432″ height=”260″]http://www.phillipdampier.com/video/WFAA Dallas iPhone Frustration 11-30-09.mp4[/flv]

Last year like this year, WFAA-TV in Dallas reports frustrations continue with AT&T’s wireless data network.  The company’s response?  Limit customers’ use of it and push more of them off to Wi-Fi alternatives.  (2 minutes)

Verizon Wireless is willing to be aggressive to keep your business — if you are a good customer that pays your bill on time.

The company has been trying to deal with a growing number of its long-time customers who have gone “off-contract” and are still using phones they bought two, three, and even four years ago.  The issue?  Pricey data plans.

“A Verizon Wireless phone bill for a family of four can easily exceed $200 a month when smartphones come into play,” writes Stop the Cap! reader Jim in Honeoye Falls, N.Y. “Forget about $1.99 mystery data charge-inspired bill shock.  Just getting your regular monthly bill can cause your hair to fall out.”

Jim says his recent visit to Verizon left him numb when he ran the numbers about adding his teen children to his existing Verizon account.

“My daughter is fed up with AT&T and she wants out at the end of her contract, and she’s willing to sacrifice her iPhone to manage it,” Jim says. “Her brother shares the account and he’s offered choice words about AT&T’s dropped calls to all in earshot.”

“But I was stunned by the Verizon in-store representative who started throwing numbers at me about texting, data fees, and insurance — not to mention plan changes,” Jim said.  “I don’t remember cell phone service ever being this expensive.”

Jim is grandfathered into a plan sold by Verizon around five years ago, one that eats mobile web usage from the plan’s monthly minute allowance.

Those days are long gone.  A Verizon representative told Stop the Cap! the company did away with that arrangement “for the benefit of customers.”

“Customers would sometimes forget and leave their phone running a data application overnight and consume most of their plan’s minutes for the month,” was the story told to us.  “Customers would be angry and upset when they realized their minutes were gone.”

We countered it’s far worse to get a bill reflecting data use charged at $1.99 per megabyte, per instance — Verizon’s current policy for customers not on data plans.  That has led to some unfortunate bill shock incidents where customers have ended up with bills in the tens of thousands of dollars.

Verizon “helped” its customers there as well — mandating expensive data plans for customers owning today’s higher-end phones.  Verizon argues a $30 a month flat rate data plan is better than being socked with a huge bill at Verizon’s extraordinary pay-per-use price.

“That’s like telling a mugging victim to be thankful they weren’t also raped,” Jim retorts.

What burns Jim about all of this is that unlimited data service plans do not include unlimited texting.

“It’s offensive that Verizon asks you to pay $30 a month to push mobile data around, but that doesn’t include a single text message,” Jim writes. “If you forget to add a text plans, it’s 20 cents a message.”

Verizon offers a budget package of 250 text messages for $5 per month.

Jim’s journey is a familiar one we’ve heard repeatedly from Verizon Wireless customers who are interested in exploring today’s advanced feature phones, but are turned off by the corresponding fees levied by the wireless carrier — fees that can dramatically increase customer bills.

“We pay around $100 a month for two lines with Verizon when all of the taxes are added up,” Jim says. “To bring my kids on board, we’d have to upgrade away from our current cell phone plan to one with at least two mandatory data plans, which would add $60 a month to our bill just for that.”

Verizon’s back-of-the-envelope calculations suggest Jim’s new Verizon bill would easily exceed $200 a month based on their usage and plan features.

“That’s crazy,” Jim feels.

Those prices cause customers like Jim to head for the door, telling Verizon to leave their account the way it was when they walked in the door.

Verizon seems to be getting that, because the company is increasingly targeting upgrade offers to contract-renewal-resistant customers, especially with family members eager to jump into smartphones.

The most welcome news — rumors the company may explore offering a FamilyShare Data Plan that carries a usage allowance, but is charged per account, not per phone.  For casual users and those more than happy to switch to Wi-Fi where available, that could represent serious savings.

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In the meantime, two promotions that are available offer some help for customers looking to upgrade:

FamilyShare – Smartphones Talk Free a/k/a $10 off data plan

Marketed in two ways, this promotion targets multi-line customers with one or more members seeking a smartphone upgrade, but do not want to have a stroke when they open the bill.

The promotion works with existing Verizon Nationwide Family SharePlans starting at $69.99 monthly access for 700 Anytime Minutes.  Add a $29.99 data plan for each additional smartphone and get $9.99 off your bill for each smartphone, per month, for the next two years. Sometimes this is pitched as “$10 off our unlimited $29.99 data plan” — because it is the price of the data plan that usually scares would-be smartphone customers back to their old phones.  Charging $20 instead of $30 is soothing enough to ease some customers on board the smartphone revolution.

“This is an ideal option for customers with a spouse or child wanting to move to a smartphone,” said Marni Walden, vice president and chief marketing officer for Verizon Wireless.

The caveats.  Your new smartphone will probably come with a two year contract extension and the primary line on the account is not qualified for the discount.  But there is an easy way around this.  If one or more lines on your account are not going to upgrade, simply have Verizon reassign one of those lines to be the primary line.  Legacy service plans no longer offered will have to be abandoned, and there is no way back to them.  This promotion expires January 7, 2011.

Talk (450 Minutes) With Unlimited Text and Data for $69.99 per month

Price conscious consumers have started giving carriers like Sprint a second look.  Rated the most improved carrier by Consumer Reports, Sprint’s aggressive pricing has begun to attract some Verizon customers.  In response, Verizon has been testing a new promotional plan that makes data and texting unlimited for one flat price.  The plan was initially open only to those who received an invitation in e-mail, but a quick call to Verizon Wireless customer service finds at least one call center that can add this plan for anyone — no invite required.

The plan’s price for single line accounts is $69.99 per month and a one year contract renewal is required for those with less than one year remaining on existing contracts (or those off-contract altogether.)  If you still have more than a year remaining on your contract, no further extension is required.

A companion FamilyShare plan delivers 1,400 minutes per month.  The monthly $139.99 price delivers service for two lines.  Each additional line is $19.99 per month, which includes unlimited texting and data.  For heavy users with several smartphones on an account, this plan can represent significant savings, and does not expire.

Caveats: Getting either plan might take a few calls to customer service.  Not every call center can add this promotion for customers.  Voice minutes might be too limited for some customers, but Verizon also offers the Friends & Family option, allowing unlimited calling to a select group of numbers.

Phone Promotions

This holiday season, selecting your new phone is probably going to be the cheapest part of your relationship with Verizon over the next two years.  The carrier is literally giving away several smartphones, offering buy one, get one deals on others.

Promotions like these from Verizon should not be the final word on pricing. Compare offers from online phone retailers and then call customer service and negotiate prices down.

Consumer advocates acquainted with the wireless market traditionally suggest the biggest savings come from online merchants like Wirefly, Dell Mobile, or Amazon.

At first glance, that advice seems sound.

Jim’s daughter and son both want the Droid X which sells for $199.99 on Verizon’s website. Verizon offers a Buy One, Get One special on the Droid X currently so the effective cost for two phones is $199.99.

But hang on a moment.  Dell Mobile (powered by Wirefly’s parent company) has the same phones for much less — $19.99 each, based on how the phones would be added to Jim’s account.  Until last evening, Dell even threw in a $25 gift card to sweeten the deal.  Excluding that, the difference in price between Verizon and Dell was a whopping $160 for the exact same phone.

Trying to narrow the difference used to be an exercise in futility for many Verizon customers.  With a market leadership position, Verizon doesn’t have to viciously compete on price.  As a result, hard fought negotiations often yielded little more than an accessory like a car charger thrown in to sweeten the deal.

But those days are starting to change, especially when Verizon considers you an excellent customer prepared to change carriers.

Lesson one for Jim was to avoid Verizon stores if he wanted the best possible deal.  As he discovered, Verizon store employees are recalcitrant about giving away the store as they try and protect their commissions and sales numbers.  Besides, many of the employees Jim dealt with seemed to know less about Verizon’s plans than he did.

Jim decided he could handle Verizon’s Smartphones Talk Free promotion, but he wasn’t about to leave $160 on Verizon’s table for the phones.  He visited a Verizon store in nearby Rochester to see what could be done about the price of the phones.

“Basically nothing was the answer,” Jim says.

“These guys will say anything to make a sale,” says Jim.  “But when you try and negotiate with them, they have little authority and less to offer.”

He reports a sales representative finally offered him free cell phone cases and a spare charger (a $100 value according to the Verizon rep — a value Jim disputes) instead of a price discount.

“I walked out,” said Jim.

While inquiring about how to place his order with Amazon, the online retailer instructed him to call Verizon directly to reconfigure something on his account before placing the order.

That was a fatal mistake… for Amazon.

“I was very surprised that the Verizon Wireless representative immediately started to fight for my business in ways the in-store reps never did,” Jim reports.

When Jim made it clear he was not about to give Verizon $160 more than he had to, the Verizon Wireless representative reviewed his account and placed Jim on hold.  Moments later, Jim learned Verizon would match Amazon’s offer.

“That was actually a relief for me because those third party online retailers have their own contracts you have to sign yourself committing to no account changes for six months, and you are never really sure whether they’ll configure the account properly,” Jim said.

Jim also scored free overnight FedEx shipping in time for Christmas and the representative promised to call him back after the phones arrived to finish setting up the account.

The only downside is that Verizon is still sticking Jim with mail-in rebates that will be fulfilled with debit cards.  His charges for the new phones will get added to his regular Verizon bill, however.  No credit card required.

Verizon’s willingness to extend offers can depend on your business relationship with the company.  Making late payments or arriving credit challenged can dramatically reduce how far Verizon will extend its hand.

Our advice to others in Jim’s position:

1. Call Verizon customer service and deal with them, not store employees when trying to negotiate the best deal.  A good phone rep will deliver discounts in-store salespeople know nothing about and won’t be willing to offer even if they did;
2. Make it about the price.  If you have a competing offer, share it with them.  Verizon can easily adjust prices downwards with their New Every Two $50 credit and do better with additional credits such as a free month of service to effectively knock your price down;
3. If they offer accessories, hold out for actual billing credits.  Buy your own accessories later;
4. Be prepared to hang up and call back if you get a difficult representative.  Some call centers are better than others;
5. Consider the competition.  Customers on individual plans might find far better deals with prepaid carriers like Page Plus that use Verizon’s network.  Or it may be time to consider a different carrier.
   

Verizon Wireless customers exchanging defective phones can expect to receive a pre-owned, "like-new" replacement from the wireless company.

Some Verizon Wireless customers are upset by the wireless company’s refusal to replace brand new, but defective phones with an equivalent brand-new phone, even just a few days after purchase.  Instead, customers are handed returned, usually refurbished phones originally used by other Verizon Wireless customers.

For some customers, that is tantamount to getting back “other people’s problem-phones.”

“You honestly have no idea how the last customer who owned the phone treated it,” writes Stop the Cap! reader Jenna, who lives in Fort Wayne, Ind.  “That person could have used it as a coffee coaster or dropped it in the street — how can you know?”

Jenna is upset because she purchased a brand new Verizon Droid phone and paid a premium for it in order to keep to just a one-year service agreement.

“This is one expensive phone, costing me hundreds of dollars, and it just quit working two days after I bought it,” she writes.

When she returned to the Verizon Wireless store expecting a new, off the shelf replacement, she was shocked when the company would only hand her a used, “re-certified” phone.

“I bought a factory fresh phone and that is what I expected to receive.  I could understand getting a refurbished phone if I had the phone six months, but 48 hours after purchase, no way,” she said.

Jenna’s replacement was handed to her in a plain box shrink wrapped with a “like new” sticker attached to the front.

“If I wanted ‘like new’ I would buy a used phone on eBay,” Jenna explains.

Despite several attempts, Verizon steadfastly refused to replace her dead phone with a new one, so Stop the Cap! alerted Jenna to the fact Verizon has a 30-day “worry-free” guarantee for new customers or those renewing contracts.  “If you’re not completely satisfied, you can cancel service within 30 days and pay no early termination fee if you return your device. A restocking fee may apply.”

“Thank you for letting me know about the 30-day trial, which gave me new leverage,” Jenna follows up.  “I walked into Verizon Wireless and talked to the same guy who refused me the first time and told him I wanted to return the phone under the 30 day policy and like magic the heavens opened.”

Jenna reports not only did the store manager promptly offer to replace her phone with a factory-sealed model, she also received some free accessories to make up for her inconvenience.

“The only way phone companies listen is when customers have some leverage to hit them in their wallets,” Jenna said.

Jenna also complained to several consumer reporters in the Fort Wayne area.  WANE-TV did a story on a reporter’s own personal experience with Verizon’s intransigence.

Jason Wagner, a Verizon Wireless store manager, told the reporter he actually preferred getting and using refurbished phones.

“I personally would rather use a certified, pre-owned [phone], Wagner explains.  “I know this phone has been checked […] and is going to work the way it should.”

“Good — he can have mine,” said Jenna.

[flv width=”480″ height=”380″]http://www.phillipdampier.com/video/WANE Ft Wayne Verizon Defends like-new Policy 11-17-10.flv[/flv]

WANE-TV in Fort Wayne talked with Verizon Wireless about their exchange policies after a reporter at the station tried to exchange her defective phone.  (2 minutes)

Verizon's Home Phone Connect base station

Verizon Communications has announced a new option for landline customers to ditch their local phone company with a new device that routes home phone calls over Verizon Wireless’ cellular network.

Verizon has chosen two test markets for its new Home Phone Connect service — Rochester, N.Y., serviced by Frontier Communications and Time Warner Cable and Connecticut, which is served by AT&T and Comcast.  (Thanks to our reader Bob for sharing the news with us.)

The service works with your existing home wired and cordless phones.  Customers signing up under a one or two year service contract will receive the base unit free of charge.  Installation is as easy: Just unplug the phone cord from the wall and plug it into the back of the Home Phone Connect device.  The unit supports up to two hard wired (non-cordless) phone lines and a cordless phone base station.  When you pick up any phone around the house, the base station will deliver a familiar dial tone, but all calls are made and received over the Verizon Wireless cell phone network.  You can download an read a copy of the installation manual here.

The service is priced at $9.99 per month for existing Verizon Wireless customers with any existing Family SharePlan that has two or more lines with at least a 700 minutes calling allowance per month.  Customers using Home Phone Connect under this plan will use minutes from their existing wireless service plan.  But since calls to and from Verizon customers and all calls placed during nights and weekends do not eat minutes, this may be a viable option for many customers.

For heavy talkers, or those without a qualifying Verizon Wireless service plan, an unlimited talk time plan is available for a flat $19.99 per month.

All local and domestic long distance calls are included, and the service also comes with these features:

• Call Waiting
• Call Forwarding
• Caller ID (not currently compatible with Caller ID + Name)
• International Dialing (charged at prevailing Verizon long distance rates)
• 3-Way Calling
• Basic Voice Mail (*86)
• Account Balance (*225)
• Device Provisioning, (*228)
• Account Payment (#786)
• 311, 411, 511, 611, 711 & 911 (some services not available in all areas)
• Last Number Callback (*69)
• National Domestic Hope Line (#4673)

The base unit includes a backup battery to power the unit for up to 36 hours idle time/2 hours talk time in the event of a power failure.  Customers relying on landline service that works with a monitored alarm system should check with their alarm company to ensure compatibility with cell network technology.

Michael Murphy, Verizon’s public relations manager for the New England Region, said consumers have the option of keeping their existing home phone number or requesting a new one.  Customers who do switch their current home phone number to Verizon will automatically cancel their existing landline service.  Frontier customers should carefully check their bills to make sure they are not on a Frontier “Peace of Mind” contract before switching.  Any expiration dates adjacent to the type of home phone service described on your bill likely means you are on a term contract.

Customers dumping Frontier before their contract expires could be exposed to early termination fees of up to $300 or more, which will appear on a customer’s final bill.  If you did not authorize a service contract, demand that Frontier drop it from your bill before you switch, and follow up with a complaint to the New York Attorney General’s office if the company fails to comply.

The device is intended to be portable, so you can take your “home phone” with you to any area served by a Verizon Wireless signal.  Just pack the Home Phone Connect base station and take it along.

Verizon carefully chose test markets outside of Verizon landline service areas.  That allows them to pick up new “landline” customers without harming their own landline business.

Verizon Wireless has a very large share of the Rochester, N.Y., market because of its ownership of the legacy Rochester Telephone cellular network.  Verizon delivers far more robust coverage than any other regional cellular provider in western New York.  With a built-in customer base wide open to Verizon’s marketing machine, the phone company could grab a significant number of Frontier landline customers who will see significant savings over Frontier’s comparable landline feature plans that run close to $50 a month after taxes and fees.  The company could also poach a number of Time Warner Cable’s Digital Phone customers, especially those whose first year promotional discount has expired.

In Connecticut, Verizon is challenging AT&T, which provides most of the state with its landline service.  Comcast is the dominant cable operator.

Comcast seemed unimpressed with the challenge being raised by Verizon in its service area.  The cable company hinted Verizon’s lack of a bundled service option including phone, cable, and broadband would hurt its chances of success.

Indeed, Verizon will have to develop some creative marketing to make its Home Phone Connect stand out.  Younger customers have no landlines to switch.  Most of those eager to cut their home phone line have already moved to cellular or Voice Over IP services from their local cable company or other providers like Vonage.  Existing Verizon Wireless customers may be hesitant about using a service that burns their wireless minutes away.  Older customers are unlikely to understand the product and have a built-in resistance to dropping traditional phone service.  Many may resist the notion of being stuck with at least a one year contract for an untested service.

T-Mobile attempted to market an almost identical service under its @Home brand, but judged it a failure and disconnected it earlier this year.

Because the service is being test marketed, its availability is limited to selected Verizon Wireless stores:

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/Verizon Home Phone Connect 11-23-10.mp4[/flv]

The New Haven Register set up a video interview with a Verizon representative to demonstrate its new Home Phone Connect service. (1 minute)