Verizon's McAdam dismisses unlimited data plans: 'You will run out of gas'

Verizon Wireless believes that competitors like Sprint, which offers unlimited data plans to customers for the life of their phone line, will eventually have difficulty maintaining that promise to customers. Speaking at the Goldman Sachs 22nd Annual Communacopia Conference, Verizon Communications Chairman and CEO Lowell McAdam said that with traffic on the networks steadily increasing there is going to be a point where operators hit a ceiling in terms of available bandwidth.

"If you are allowing unlimited, you will run out of gas. It's physics," he said. McAdam also said that he believes Verizon, which has always used network quality to differentiate itself from its competitors, will continue to lead on that front. Specifically, he said that 4G is not the end of the lifecycle of the network and he hinted that 5G is coming. "5G is video," he said, adding that there is still a lot of room for growth on the 4G network. McAdam said that while there is demand for a business model in which the content providers pay for their content to be distributed over the wireless network, he said that he thinks it will be at least two years before that model actually becomes a reality in the marketplace.