Verizon Bundles to Lower High Speed Internet Pricing with Reduced Contract Concerns

verizon-cable In a move that puts their high speed Internet offerings alongside cable networks using the concept of bundles to combine multiple services into one with reduced costs for all. In a press release on PRNewswire, Verizon pretty much markets their new idea to provide both Internet and voice together over their copper for less—but the real news tacked onto this happens to be the reduction of contract terms.

“We’ve enhanced the value and simplified our HSI bundles by pricing them aggressively and removing any contract requirements and early termination fees for Verizon services going forward,” said Eric Bruno, Verizon vice president of product management.  “With these refinements, our High Speed Internet service offers the best value in broadband.”

Consumers who order a bundle online will save $5 per month and receive a free wireless router.  Consumers who order stand-alone HSI service online can also save $5 per month, lowering the basic HSI offer to $14.99 per month with a qualifying voice package.

Either Freedom or Regional Essentials can be substituted in any bundle, with bundle pricing going up or down to reflect that substitution.  All bundles feature up to 4 gigabytes of online storage, nine email accounts per household, 10 megabytes of personal Web space to accommodate a blog or Web page, award-winning online support and round-the-clock phone support.

Additionally, customers who order an Enhanced HSI bundle have access to Verizon Wi-Fi at no additional charge, allowing them to connect to Wi-Fi hot spots offering access in airports, hotels, bookstores, coffee shops and more.

Verizon obviously wants to sell not only their voice networks but DIRECTV service as these are also rolled into many of the bundles with further discounts. However, reading up on these different product bundles, it makes me wonder when a company like Verizon will think about hybridizing wireless with wired. How many on-the-go executives and workers would really like not just the Wi-Fi bundle, but the ability to add discounted access to wireless cellular networks to their Verizon Wireless phone contracts if they have Internet at home.

Paying for a landline is interesting, but with the proliferation of cell phones and Internet telephony, a great deal of copper dedicated to residential voice is probably facing a fade off. This is likely why Verizon wants to tie any high speed Internet packages to “qualifying voice packages.” Perhaps they might find a lot more subscribers if they tied it to their wireless cellular service instead. Or, perhaps the resurgence of long range, urban Wi-Fi networks might be the saving grace for future bundles.

Cable outfits like Cox and Comcast already provide very similar bundles, being that they provide both cable TV and cable Internet and via their Internet they do a lot of VoIP on the cheap. Verizon is likely looking to cut into the stranglehold that cable manages across these services because they can offer them readily all-in-one—a move that most cable companies have been aiming for to alleviate fears of cord-cutting.

Contracts are Made to be Broken

Something that may draw in quite a few people and actually keep them is the lessened fear of having to suffer horrible penalties if they want out of a contract early. In an oddly downplayed segment of the story, the Verizon press release mentions “…no contracts or early termination fees on Verizon’s services.”

It’s only mentioned twice and doesn’t really get played up that much. But, how common are multi-year contracts in high speed Internet ventures anyway? That’s the stuff of wireless carrier contracts. If Verizon wants to compete with standard DSL ISPs and cable Internet they will probably want to stick with month-by-month plans the way everyone else does.

Perhaps they’re referring to the way they played out bundles in the past, especially those that provided voice services, which often still mimicked their wireless business model.

Old Advice from the FCC

In good news for Verizon, they seem to be following some powerful advice from last year by FCC Chairman Julius Genachowski in reducing costs for high speed broadband and increasing the speed. There’s also a bit of a shell game going on, but they do seem to be attempting to make lower speed, but still solid bandwith, with their $15/mo. Offering for 1mbit.

Alongside the FCC’s upcoming broadband test, I wonder how Verizon will do. As we watch the FCC is coming up with a new broadband plan for the United States that uses Wireless ISPs as a backbone and opening up more spectrum.

When might we see this on the table of some of these bundles?