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