AT&T and Verizon Face Tough Competition From Smaller Companies

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AT&T and Verizon Face Tough Competition From Smaller Companies

 Phone carriers like Verizon (NYSE:VZ) and AT&T Inc. (NYSE:T) may not be the top dogs much longer. With the rising usage of smart phones, most carriers want to utilize this opportunity to make a bigger profit at the expense of their customers. This means offering fewer network-plan choices and increasing the fees of current plans. Fortunately for consumers, several smaller companies are now offering much cheaper alternative plans and that could completely change the current market.

Clearwire Corporation (NASDAQ:CLWR) was the first to 4G network services and now they’re letting FreedomPop give away 1GB of free data with the purchase of a WiMax shell. Unfortunately, this offer will be available exclusively to people in select areas who own an iPhone 4 and 4s. Hopefully, this pilot plan will catch on and expand nationwide and to users who own other smartphones.

FreedomPop isn’t the only instigator of this revolutionary idea. NetZero (a subsidiary of United Online Inc) offers 200 MB of free data for a whole year with the purchase of a wireless modem. Again, this offer is exclusive to those who live in major metropolitan nations but unlike the previous offer,  all you need is a phone with USB outlet. Moreover, their small and portable modem sticks retail for less than $50.

The analyst for Macquarie Securities USA Inc had this to say about the potential changes, “FreedomPop could, over time, put pricing pressure on the incumbents. They have the potential to be disruptive”

Although it’s still too early in the game to see whether or not FeedomPop and NetZero could change the way people pay for data plans but I think it’s a change that’s long-overdo. As more and more people utilize mobile technology, they are going to expect more economical choices.  AT&T, Verizon, T-Mobile, and Spring have long dominated the cell phone industry with in-demand phones and premium services but sometimes customers want more for less. And that is something these new plans offer.

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