Verizon is finally giving away free iPhones to win over 5G clients

Bloomberg

Facing pressure from its wireless competitors, Verizon Communications Inc is offering free Apple and Android phones to customers who sign up for unlimited plans on its faster 5G network.
Once a holdout on giveaways to existing customers, the largest US wireless carrier is now matching similar trade-in offers from AT&T Inc and T-Mobile US Inc — part of an effort to reverse recent subscriber losses.
New Verizon customers who chose a premium 5G unlimited plan can qualify for as much as $1,000 in credit towards an Apple iPhone or $1,100 for the Samsung Galaxy S21. Current customers are eligible for $700 towards an iPhone or $800 for an Android model if they move up to a higher-priced unlimited plan.
“We’re very much doing this from a position of strength,” Ronan Dunne, the head of Verizon’s consumer group, said. “We have a great range of choices for customers.”
Verizon lost 178,000 phone customers in the first quarter. In the same period, AT&T added 595,000 mobile-phone subscribers and T-Mobile led the group with 773,000 new phone customers.
The giveaway is aimed at reviving subscriber growth, as well as luring customers into higher-priced 5G unlimited plans. The more customer traffic Verizon can move onto its new, largely empty 5G networks, the less congested its 4G and 3G systems will be. US carriers have spent billions of dollars on airwave licenses and are building 5G wireless networks that promise speeds 10 times faster than current connections. T-Mobile has a lead of a year or more in 5G coverage after acquiring Sprint Corp. and its trove of midband airwaves.
AT&T, meanwhile, is spinning off its WarnerMedia division and will use a portion of the $43 billion in cash from that deal to expand its 5G network. The carrier has been the most aggressive with phone prices, giving away new Apple Inc. iPhones and Androids to new and existing customers who upgrade their plans.
Verizon was first to launch 5G, but its ultrafast connections ride on tricky millimeter waves that don’t travel far or pass through leaves and glass. The company offers nationwide 5G service, but its superfast 5G experience is available only in limited areas within 75 cities, 13 airports and more than 60 arenas.
While technically offering unlimited service, AT&T and Verizon both throttle connection speeds after customers reach certain data caps or if their networks are congested. T-Mobile boasts that it never curbs the speeds of its unlimited customers. Plans can cost up to $90 a month.
The phone offers are a bit of a throwback. A decade ago, free handsets were a common way for carriers to lock customers into two-year contracts. Today’s offers provide credits on monthly device payments spread over two years or more. Customers who stick with the service for two years have their payments covered. Those who leave, on the other hand, are on the hook for the remaining phone payments.
Dunne sees signs that the economy is picking up based on store activity and traffic patterns on the network that indicate people are moving around at pre-pandemic levels again.
“We want to do our bit to get the country moving again,” he said.