Starting October 28, Verizon will sell the WiFi version of Apple‘s iPad. While this isn’t surprising in light of the increasing volume of rumors that the wireless carrier will soon offer an iPhone and the fact the both Target and Walmart now carry the device, what is interesting is the nature of Verizon’s iPad offering as it relates to wireless data.
As we mentioned above, Verizon’s only selling the WiFi version of the iPad, which makes sense considering the 3G version only works on rival AT&T‘s network and costs $130 more. What’s interesting is that Verizon will sell customers an iPad and one of their 3G wireless hotspots for the same $130 premium.
At first, this seems like a rip-off. After all, right now Verizon sells the same hotspot for the much lower price of free. But that “free” hotspot comes with a pretty big catch in the form of 2-year contract that requires a minimum spend of $40 a month for a measly 250 MB of data. This kind of pricing is exactly why we (and presumably many others) haven’t thrown down for a source of mobile data aside from our phones.
What’s exciting about Verizon’s iPad offering is that all this could be changing. For $20 a month, Verizon will offer iPad + hotspot purchasers 1GB of data without a contract. Given that AT&T charges $15 a month for 250MB of data for the 3G iPad, this could well be the first salvo of a full-fledged wireless data price war.
What remains to be seen is if Verizon will offer this deal to anyone with one of their mobile broadband devices or if it’s only good on iPad + hotspot purchases. If the latter’s the case, we wouldn’t be surprised to see a lot of 16GB iPads popping up on eBay as clever folks take advantage of the opportunity to buy a contract-free mobile hotspot with $20 a month data for $130.
At that price, a lot more people might consider paying for data. In fact, Verizon’s move might prove that it’s advantageous for carriers to sell unsubsidized wireless broadband modems and hotspots without contracts, charge lower prices for data and make money off of the increased volume.
Finally, if a full-fledged wireless data price war does break out, it can’t be long before it spreads to the data packages that carriers require smartphone owners to purchase. We personally think that the introduction of a Verizon iPhone would be a great occasion on which to open this front.