January 10, 2011 at 8:42 am

Verizon Will Reportedly Woo iPhone Users with Unlimited Data; AT&T Takes the Defensive

Verizon plans to announce an iPhone for its 3G wireless network, giving U.S. iPhone users a choice in cell service providers.

As one might predict, AT&T and Verizon are now engaged in yet another public slapfight in anticipation of tomorrow’s announcement, this time about which network will be best for iPhone users.

Verizon plans to tout one big advantage over AT&T’s network tomorrow, according to multiple reports: an unlimited data plan that lets iPhone users stream as much music and other data to their phones as they want, without incurring penalties, the way they would with AT&T.

Anonymous sources (who have blabbed quite a bit about this) told Reuters that Verizon will sell iPhones under its existing data plans, which include the music-friendly, unlimited option. Another of these well-placed anonymous sources told Wall Street Journal that Verizon claims to have increased its network capacity enough to offer unlimited data to data-hungry iPhone users.

AT&T tried to defend itself against Verizon’s unlimited data gambit, which seems expressly designed to steal AT&T’s existing iPhone users while grabbing the lion’s share of new subscribers, by claiming Verizon’s 3G network is slower, even if it has a wider coverage footprint and unlimited data.

AT&T spokesman Larry Solomon told Business Insider,

“The iPhone is built for speed, but that’s not what you get with a CDMA phone. I’m not sure iPhone users are ready for life in the slow lane.”

Of course, when AT&T first started offering the iPhone, it too offered unlimited data plans to woo iPhone users, in an attempt to preserves its network speed. Verizon could easily do the same, killing off its unlimited-data iPhone at some point in the future. Still, that won’t stop people from signing on to Verizon’s iPhone unlimited plans while they’re hot.

Pandora founder Tim Westergren told Evolver.fm last week that Pandora app users on the iPhone typically only use 200MB of wireless data for the service per month, which is well under the ceiling of AT&T’s 2GB plan. But the threat of hitting one’s limit can curb the urge to use data-hungry apps in addition to the limits themselves.

And of course the limits are real, making this an important issue for music fans or anyone else who wants to use their smartphone’s data connection for video, multiplayer gaming, or other fun stuff. Basically, you don’t want to be forced to stop using all of your other apps for the rest of the month just because you listened to too much music.

The Verizon iPhone, which we expect to be available around April, could easily become a victim of its own success. When the iPhone first hit AT&T’s network, AT&T complained that iPhone users’ data-hungry habits were themselves to blame for network congestion. We expect the same could happen to Verizon.

It will be interesting to see how this plays out, following tomorrow’s announcement. No matter how you slice it, this added competition can only be a good thing for iPhone-owning music fans. Ideally, it would force AT&T to start offering unlimited data plans again, and Verizon to continue increasing the capacity of its 3G network.

(via Apple Insider, Silicon Valley Insider; photo courtesy of Flickr/jfingas)