Emergic: Rajesh Jain's Blog

Emergic: Rajesh Jain's Blog header image 2

Mobile Data Pricing

March 27th, 2006 · No Comments

Ajit Jaokar links to an open letter to Vodafone by Rudy De Waele and carries a couple of comments which shed light on operator data pricing policies. An excerpt from a comment by Jonathan Crooks:

There are some fundamental differences between how GPRS and UMTS data services are delivered over that most scarce of resources, the radio (and I include the cost of the relevant infrastructure here as well).

In short GPRS access effectively competes for voice access in the 2G network – so any attempt to offer a flat fee model has to consider the potential lost revenues from those voice calls that cannot now be made due to lack of bandwidth. In the case of VF Live! there are alternate revenue opportunities for VF other than the pure per MB charge and clearly they believe they can recoup their lost revenue this way (or at least swap it for some branding advantage).

For UMTS – this is largely unused spectrum at this time and there is plenty spare for devoting to data services – such as the 3G data card package. 3G is not a service but a network capability and at the moment the voice services on offer over 3G are not very compelling – thus there is very little take up in the consumer market. However data services (mobile web browing from a PC, corporate VPN etc) is quite compelling at up to 384KBps and this is a differentiated service – hence the offer of flat rate packages. Granted sometimes there is no 3G coverage and they use GPRS (thus getting back into that lost voice revenue issue)- this is just something VF has to live with in order to promote 3G services.

For the longer term, as 3G handsets are now almost indistinguishable from 2G handsets there will be much more uptake of 3G voice (albeit unknown to the user) and you could imagine this issue (voice vs data revenue) will raise its head again in a few years.

Tags: Telecom

0 responses so far ↓

  • There are no comments yet...Kick things off by filling out the form below.

Leave a Comment