Rewheel/research

The state of 4G pricing – 2H2018 – Digital Fuel Monitor 10^th release

October 2018

With special focus on US prices ahead of the planned 4 to 3 consolidation. How many 4G gigabytes €5, €10, €15, €20, €25, €30, €40, €50, €60, €70 and €80 could buy in EU and OECD markets on smartphone and data-only plans.

Unlimited mobile data and fixed-to-mobile broadband substitution ?

It is all about unlimited mobile internet: in smartphones, portable MiFi’s or 4G wireless home broadband.

How many gigabytes €30 ($35) buys in 4G smartphone plans?

In October 2018 €30 bought a 4G smartphone plan with truly unlimited volume in 13 countries (up from 10 in April 2018) while €20 bought a 4G smartphone plan with truly unlimited volume in 8 countries (up from 4 in April 2018).

Median gigabyte prices in 4 versus 3-MNO markets

Gigabyte prices in 3-MNO European markets are 2x higher than in 4-MNO markets.
Gigabyte prices in 3-MNO EU28 & OECD markets are 81% higher than in 4-MNO markets.

Are gigabyte prices in the 4-MNO US market competitive?

Even though there are 4 MNOs present in the market US gigabyte prices are not competitive.
The US has the 5th highest gigabyte prices in smartphone plans and is the most expensive market in mobile broadband among the 41 EU28 & OECD countries.

Key development in other markets

Italian gigabyte prices fell 70% (October vs. April 2018) following Iliad’s seismic launch as the new 4th MNO.
Dutch prices were flattish. After the announcement of the 4 to 3 mobile merger between T-Mobile and Tele2, Dutch gigabyte prices started falling much slower.
In Korea, sub-brands of KT Telecom and LG Uplus have started selling smartphone plans for less than €30 with unlimited volume.
KT Mobile and Uplussave have been discounting in promotional offers the price of their high-end smartphone plans from 49 300 WON (€37) to 33 880 WON (€26).
Despite these new promotional offers, the overall gigabyte price level in Korea remained high (e.g. €20 buys only 3 GB) and hence in the median gigabyte price comparison Korea still ranks as the 3rd most expensive country.

Are US gigabyte prices much higher than in European 4-MNO markets?

The median gigabyte price of smartphone plans in the US is 4x higher than in EU's 4-MNO markets
The median gigabyte price in US is 16x higher than in a competitive 4-MNO large European market
The US market is considerably less competitive than the 4 to 3 consolidated Austrian, Irish and German markets and a universe apart from the competitive Danish, French, UK, Dutch, Swedish and Italian 4-MNO markets.
The US is an outlier 4-MNO market with much higher prices, that are typical to 3-MNO tight oligopoly markets.

How many gigabytes €30 buys in 4G mobile and wireless home broadband plans?

Unlimited mobile broadband plans for fixed-to-mobile home broadband substitution (FMS) are now available for less than €30 in 11 countries (up from 9 countries in April 2018) and for less than €20 in 9 countries including Switzerland, Austria and Finland (up from 8 countries in April 2018).
Judging from the excessive gigabyte prices, US operators are charging today for 4G mobile broadband (see Verizon’s striking $710 100 gigabyte hotspot plan, in Europe 100 gigabyte mobile broadband typically costs between €10 and €20) merger promises concerning affordable 5G home broadband should be critically reviewed and if verified must be made binding.

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[External post, Linkedin]
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