Monday, October 01, 2007

UK Operators unleash ‘flat rate’ data plans

The BBC reported today that T-Mobile, Vodafone, Orange and Three offer flat rate price plans for internet access on mobile phones. O2 will launch a plan in October prior to the iPhone launch.

In the article, Richard Warmsley, head of internet at T-Mobile, comments that 500,000 people have signed up for their ‘web and walk’ service in 18 months. Mr. Warmsley goes on to add:

Half of our customers surf the internet on their mobile when they are at home watching TV. They do not need to go to a laptop and fire it up. The mobile is there for them.”

Key take-away #1: As an operator, if 50% of your data traffic is generated at home, use Wi-Fi and UMA rather than the more expensive macro RAN.

Another interesting point in the article is that flat rate pricing apparently boosts downloads from an average of 0.18 megabytes to 0.60 megabytes, more than 3x in capacity.

Key take-way #2: Is your network ready for a 3x increase in data traffic/capacity, especially when 50% of that traffic is happening at home within range of Wi-Fi and could be off-loaded to broadband & IP?

There is a chart in the article which shows the different rates:

  • T-Mobile - £7.50/month (1 GB limit)
  • Vodafone - £7.50/month (120 MB limit)
  • Orange - £8.00/month (30 MB limit)
  • Three - £5/month (1 GB limit)
  • O2 - £7.50/month (200 MB limit)

Key take away #3: As an operator, prices for flat rate data plans are going to come down. Clearly Three is already one third the price of the T-Mobile plan. Therefore, making massive capacity investments to support more traffic at less revenue per user is not ideal.

Wi-Fi, IP and broadband look more attractive all the time.


Sajith said...

Is this like the beginning of the end, when internet players take over the mobile relationship like on the wired internet?

UMAer said...

I don't know if it's the 'beginning of the end', but there are certainly battle lines being drawn.

Mobile operators are fearful of becoming 'pipes' and are trying to develop services which prevent that (the 'walled garden').

Yet most consumers expect to be able to do anything and go anywhere on the internet, not limited to one 'garden'.

Here in the US, wesee Verizon pushing their V-Cast music download service hard, yet Sprint is going the 'open access' route via WiMAX and embracing a 'pipes' strategy.

The fixed line operators know this is a slippery slope, and the mobile operators are trying to learn the important lessons from their fixed cousins.