FILE PHOTO --  The logo of Verizon is seen at a retail store in San Diego, California April 21, 2016.  REUTERS/Mike Blake/File Photo Thomson Reuters

  • Verizon has three new unlimited plans that will replace its single unlimited plan introduced in February.
  • The basic version of the new plan is cheaper but comes with more restrictions in data speeds and video-streaming resolution.
  • Customers with grandfathered unlimited plans will be affected and might as well switch over to the new plans.

(Update: Some information about video-resolution throttling has been corrected from an earlier version of this article, which said existing Verizon unlimited-data customers would experience the throttling. Existing Verizon unlimited-data customers will not experience video-resolution throttling.)

Verizon on Tuesday announced three new “unlimited” data plans that will go into effect on Wednesday, according to CNET.

The good news is that the most basic version, Go Unlimited, costs $5 less per month than the original and soon-to-be-extinct $80-a-month single unlimited plan.

using smartphone iphoneGetty Images/Tomohiro Ohsumi

The bad news is that Verizon will be able to throttle your speeds when the network is congested in your location. With the original unlimited plan, your speeds would be throttled only if you went over the 22 GB limit.

There’s more bad news if you like to use your unlimited plan to watch videos: Video-streaming quality for the new Go Unlimited plan will be limited to “DVD” quality, or 480p. (The current unlimited plan allows you to stream in “HD” quality, or 720p.) If you don’t care so much about video resolution, Verizon’s new limits won’t matter much, and you’ll win by paying $5 less with the Go Unlimited plan.

Verizon says that “there is no visible difference in quality on a smartphone or tablet when video is shown at higher resolutions.” That means Verizon thinks you wouldn’t be able to tell the difference between a 480p video and a 720p one on your smartphone.

essential videoAntonio Villas-Boas/Business Insider

I tested Verizon’s claim by playing a YouTube video on my iPhone 6S Plus, which has a 1080p screen, and I can attest that there is a slightly noticeable difference between 480p and 720p, with 480p being slightly less sharp. But the difference wasn’t overwhelming.

If new Verizon customers want video streaming at the 720p HD resolution, as it is with the current $80-a-month plan, they’ll have to step up to Verizon’s new Beyond Unlimited plan, which costs $85 a month. Customers would essentially be paying $5 more for the unlimited plan that Verizon introduced in February.

Here’s a breakdown of the new plans and what video resolution they’ll support, according to The Verge:

  • Go Unlimited: $75/month, 480p video-streaming resolution on smartphones, 720p resolution on tablets.
  • Beyond Unlimited: $85/month, 720p video-streaming resolution on smartphones, 1080p resolution on tablets.
  • Business Unlimited: Varying price, 480p video-streaming resolution on smartphones, 720p resolution on tablets.

What if you’re already on an older Verizon unlimited plan?

Unfortunately, Verizon customers with older unlimited plans, even the $80-a-month plan, will be affected by the new speed-throttling during times of network congestion. With that in mind, you should switch over to the new Go Unlimited plan if you’re paying more than $75 a month for an older Verizon unlimited plan.

Fortunately, video-resolution throttling won’t be transferred to existing Verizon unlimited-plan customers, so those paying less than $85 a month need not switch over to one of Verizon’s new plans.

att logoFlickr/Bill Bradford

Other carriers do the same

Both AT&T and T-Mobile offer similar basic unlimited-data plans with similar limitations, where you have to pay more for an elevated unlimited plan to get faster speeds and higher video-resolution streaming:

  • The basic unlimited plans from AT&T also have speed throttling — a maximum of a slow 3 megabits per second at all times — and video-resolution limits of 480p.
  • T-Mobile’s basic unlimited plan also limits video resolution to 480p. However, T-Mobile doesn’t throttle data speeds unless you go over its 32 GB limit and its network in your location is congested.
  • Sprint offers full HD 1080p video streaming with its unlimited plan, but its speeds are limited for certain applications, like music streaming.

Verizon’s new unlimited plans, as well as the restrictive “unlimited” plans from other carriers, reflect a tightening grip on consumers, making it increasingly expensive for them to do things they used to do for less. It’s unclear whether the restrictions are aimed to increase profit or are based on the carriers’ limitations in their LTE networks.

It’ll be interesting to see how the upcoming 5G network will affect pricing, as 5G is said to have much higher bandwidth than the current 4G LTE and carriers shouldn’t have the existing network-congestion problems. In other words, carriers technically shouldn’t have any reason to throttle speeds or video resolution once 5G is rolled out, though that may take years.

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