Alltel Goes EV-DO… The Price War Begins?

We’ve discussed the $80 rule before. Any new wireless data offering seems to be introduced first at a price of $80/month. Ricochet, EDGE, GPRS, 1xRTT, and EV-DO were all offered initially at $80. However, when real competition starts to show up, the providers invariably drop the price. Usually it first drops to about $50/month, and eventually all the way down to $20 — when it’s seen as more of a has-been slow data technology. So, while the news of the day is that regional carrier Alltel is introducing its EV-DO offering, what’s a bit more interesting is that they’re smart enough to underprice Verizon Wireless by $10/month. With Sprint gearing up to enter the EV-DO market as well, that $10 could represent the sign that prices are about to start dropping out of the “early adopter only” phase, into a more acceptable range for more widespread adoption. Derek adds: Also, it could be just as simple as the fact that Alltel offers a smaller footprint than VZW, so must charge less. VZW’s EV-DO advantage will be nationwide coverage.

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