Verizon Continues To Follow Others, Now Offers To Pay For Customers To Switch

Not even a year after Verizon CFO Fran Shammo declared that the company is a “leader, not a follower,” Verizon is making it very clear that it lives in a Bizzaro world where “leader” means “do things that other companies did first.” This time, Big V is demonstrating its “leadership” by following in the footsteps of other companies that have enticed customers to switch by paying off their contracts.

In an announcement this morning, Verizon declared that you can get up to (big asterisk) $650 per line when switching from another wireless provider.

Verizon claims that it’s “simple” to make this switch and get the “up to” $650 per line, but here’s how the company’s own statement describes the process:

“when you port your number to Verizon from another carrier, purchase a 4G LTE smartphone with a new device payment activation and trade-in your existing device from your previous provider. You’ll get up to $650 on a prepaid card for the installment plan balance less the device trade-in value (or up to a $350 prepaid card for early termination fees less the device trade-in value). Your trade-in must be in good working condition and be worth more than $0, and you must keep the new line active for a minimum of 6 months.”

That’s a lot of word salad in a very small bowl, so let’s pull out the ingredients to make it more manageable.

• You’ve got to port your existing number over from the current carrier. Okay, nothing new here.

• You’ve got to purchase a new 4G LTE phone from Verizon (no subsidies) and trade in your current phone. If you’ve got an old phone and were destined to get a new one anyway, this might not be a big deal. But if you have a new device — one that might work on the Verizon network — and only wanted to switch because you hope to get better service from Verizon, then you’ve got to turn in that relatively new phone and start payments all over again on one that may be identical.

• Verizon keeps pushing this “up to $650” figure, but that’s not really what the company means. You won’t net any money at the end of this transaction.

Say you are on T-Mobile and still owe $400 on the phone you bought through T-Mo last year. Now say you switch to Verizon and they value your trade-in at $300. The value of your prepaid card is only going to be $100. You still owe T-Mobile $400. Yes, you received $300 in trade-in money from Verizon, but you also had to start installment payments (and pay for activation) on the new phone. At best, it’s a wash. At worst, you may be out a few dollars.

• The same holds true if you’re leaving a provider that you’re currently under contract with. In that case, Verizon caps the prepaid card value at $350 to cover the early termination fees from your old provider, but again that value is minus whatever Verizon gives you in trade for your old phone.

• In either case, remember that the gift card is reimbursement. You will have to go out of pocket to close your old account — whether it’s paying off a device or an early termination fee — because the process of getting the prepaid Visa card from Verizon could take weeks.

None of this is to say that the Verizon offer is a bad deal, or that it’s any worse or better than similar programs run by T-Mobile, Sprint, or AT&T. Just don’t be lured in with the idea that you might actually net any sort of cash at the end. Also, when you receive the prepaid card, remember that it’s intended to cover money that you’ve already spent; it’s not a gift from your beneficent Uncle Verizon.