UK Data Prices Start To Fall*, Sort Of

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Back in January, one of my predictions for 2007 was that more flat-rate data plans would emerge in Europe, and I was optimistic that they’d be affordable. In the UK, both Orange and Vodafone recently announced new data tariffs that show a slow start down this path, at least at first glance.

Orange postpaid customers can get unlimited browsing for 8 pounds a month, while prepay users can get a week’s worth for 5 pounds. Vodafone’s new tariff slashes data prices to £1 a day for 15 MB. Sounds great!

Until you get to the *, friend of shifty data tariffs everywhere. For Orange, the biggest * is that you get unlimited “browsing”, not internet access. They’ve explicitly forbidden VoIP, P2P, “non Orange internet based video” and even IM. There’s a * after unlimited, since it apparently means up to 1 GB for Orange. Vodafone has plenty of *s of its own, too. If a user goes over the 15 megs, they’re billed at £2/MB. Vodafone says you can’t use VoIP or “Peer-to-Peer services”, which it says includes instant messenger services, text messaging clients and file sharing. If you do, you get billed at £2/MB with a minimum of 5p per session (a fee no doubt designed to eliminate the cost advantage of IM and third-party SMS services).

Plenty of questions abound — is checking your email included in Orange’s definition of “browsing” if you use an email client or an app like Gmail for mobile, rather than via a web page? How is Vodafone’s tariff any simpler than just a flat per-MB charge? And how can users track their usage?

Obviously something’s driving these significant, if rather unsatisfying, changes from Orange and Vodafone. What seems likely, though, is that they’ll just end up intensifying attention on other operators’ data plans — and driving them to the likes of T-Mobile and 3, whose tariffs tend to be cheaper and/or less restrictive. While it’s nice to see prices come down, it’s still endlessly frustrating to see operators make these tariffs so much more complex than they need to be. All these *s and restrictions do — even if they don’t really affect that many users — is lead users to churn. One argument against flat-rate data is that they encourage usage, but put a ceiling on revenues. While that’s true, you would imagine that having a customer pay you £5 per month for data on top of a voice plan would be preferable to them churning to another operator and paying you £0 per month.

(No, I don’t have any idea what the image at the top is about, I’m just borrowing it from Vodafone’s site. Any ideas about what the picture of the nice lady has to do with data pricing can be written on the back of a postcard and sent to the usual address. I’m guessing it’s intentionally nonsensical — sort of like data tariffs.)

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