Recently, a change was made to Verizon’s device upgrade program – one that could substantially impact enterprise clients. Although most enterprise agreements have included incentives that require a 24-month subscription, as a common practice over the past few years Verizon has allowed many enterprise customers to upgrade their device after 20 months (matching other cellular providers). Verizon has quietly changed this policy to require all customers complete their 24-month term before being eligible for an equipment upgrade.
Although the 20-month upgrade was available to most enterprise customers, it is only hard-coded into a subset of customer agreements. Verizon notified customers that had the clause written into either their Master Service Agreement or an Amendment. This notice largely singled out government contracts for notification.
Everyone else will find out as they try to upgrade at 20 months like they have in the past, and find that this option is no longer offered. Below, we discuss the Verizon upgrade changes and their impacts on enterprise customers.
Verizon Upgrade Changes: What To Do in Response to Verizon’s Device Upgrade Program
Subscribers satisfying their 24-month service term are known as Out-of-Contract (OOC) devices. Large enterprise customers are advised to keep two suppliers in their mix in order to optimize costs over time. In many cases, enterprises are offered large credits for activating a new device. If they don’t port the device to another carrier, then the only offer is to upgrade to a newer device type. Porting to another carrier gets them a new device and a monetary credit. Upgrading only gets them a new device.
NPI recommends keeping at least two wireless carriers under contract and monitoring OOC devices for either upgrade or porting to a different carrier.
This change to Verizon’s device upgrade program is just one more example of why enterprises should review and optimize wireless carrier usage and spend. “Subtle” changes like this one from Verizon can drive wireless costs up over the long term and – in most cases – there are opportunities to negate the impact.