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Verizon prepared follow T-Mobile’s lead if ending phone subsidies proves profitable

Published Jan 8th, 2013 12:30PM EST
Verizon Smartphone Subsidies

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T-Mobile’s decision to drop smartphone subsidies may be a questionable business move, but it’s one that rival carriers are nonetheless hoping succeeds so that they too can stop paying for their users’ devices. The Wall Street Journal spoke with Verizon (VZ) CEO Lowell McAdam at the Consumer Electronics Show this week and found that he was very open to ending his own company’s smartphone subsidies if T-Mobile’s gambit proved effective.

Specifically, McAdam called T-Mobile’s initiative “a great thing” and said that Verizon “could move to that very quickly” if consumers took to it. The Journal also spoke with AT&T (T) mobility chief Ralph de la Vega, who expressed skepticism that ending subsidies would be a winning strategy since AT&T’s own research “says that [customers] don’t like paying upfront for the phone.”

Brad Reed
Brad Reed Staff Writer

Brad Reed has written about technology for over eight years at BGR.com and Network World. Prior to that, he wrote freelance stories for political publications such as AlterNet and the American Prospect. He has a Master's Degree in Business and Economics Journalism from Boston University.

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