The Spring Melt of Data Tariffs

What started out as a trickle, seems to be turning into a deluge, as operators around the world bow to the inevitable and launch ever cheaper flat rate data tariffs.

Yesterday alone we saw announcements from Vodafone and O2 for the UK, which means that the other operators have to follow or face losing business. One swallow might not make a summer, but two data tariff cuts do make an inexorable trend.

While it’s obvious to those of us that aren’t charged with managing a P&L in an operator that this must happen if we’re to reach the promised land of the mobile web, it’s not as much as a no-brainer for the beleaguered operators. There’s certainly an argument that suggests it’s better to charge a lot of people a little, than a few people a lot, but that’s a little superficial. For a real insight into the very valid concerns operators have, read the comment by O2′s Jag Minhas on this old MobHappy post and get a real insight into their dilemma. In addition, they have to consider that once committed to this form of pricing, there’s no return to the old and safer model ever again.

But that doesn’t really need concern us, unless we’re interested in long term shareholder value in operator companies, as all-you-can-eat and reasonably priced mobile surfing is now about to become a reality – in the UK at least. Although as far as the operators are concerned, there’s surely a lot of comfort to be had in the concept that stimulating user demand will help create value via services and products we can’t even guess at today.

Germany (where I live) is famously backward in making fair pricing available. As a result, the country is falling far behind in this new medium – according to AdMob stats (albeit these contain some bias) little Serbia consumes more Page Impressions than Germany. At a time when China has just overtaken Germany in GDP, you’d have thought that they’d be a little more gung-ho about promoting growth and new opportunities.

Even so, there’s a flicker of light that just might be the bulb coming on at the end of a very long tunnel. Ren?© Obermann, the ridiculously youthful CEO of Deutsche Telekom, the parent of T-Mobile said yesterday:


“iPhone customers retrieve weather reports, stock prices, and YouTube videos from the Internet on the go — all as a matter of course.

“The average Internet usage for an iPhone customer is more than 100 MBytes. This is 30 times the use for our average contract-based consumer customers.”

Why do you think that might be, dear readers? I’ll offer you a choice of 3 possible answers:

1. Because T-Mobile sells the iPhone with an attractively priced flat rate data package?
2. Because T-Mobile sells the iPhone with an attractively priced flat rate data package?
3. Because T-Mobile sells the iPhone with an attractively priced flat rate data package?

Please send your answers on a Postcard to Mr Obermann c/o Deutsche Telekom to help his thinking on the subject.

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