Alltel caves in to unlimited pricing pressure – with limitations

Despite expectations that Alltel would stay out of the unlimited pricing wars of late, the nation’s fifth largest wireless operator today joined the likes of Verizon Wireless, AT&T, T-Mobile and Sprint in offering an unlimited voice plan. Called Freedom Unlimited, the $99 per month plan will serve as an alternative to its MyCircle options, which offer a flat fee to call five, 10 or 20 selected numbers.

When Verizon first kicked off the race to flat-rate pricing, Alltel’s Chief Marketing Officer, Frank O'Mara, reportedly vowed to the press that Alltel would stick with its My Circle rate plans and was in no hurry to join the others. The wireless operator just recently expanded these social-network inspired plans to include five or 20 options, in lieu of the traditional 10, which has been in place since 2006. MyCircle unlimited plans start at $50 per month.

Like Verizon and AT&T, Alltel’s $99 plan will include unlimited voice and long distance and excludes text and photo messaging. In a surprising limitation, Alltel subscribers who use prepaid mobile phones or smart phones are not eligible for the plan.

In a recent Telephony podcast, Dave Spofford, President of the Telecom Expense Management Industry Association and CEO of expense management provider Invoice Insight, said that at a $99 price point, these plans are not going to affect a wide spread of customers. Most Alltel customers, who use the carrier for its affordability and perceived value, will likely be reluctant to upgrade for unlimited calling at $99.