Following yesterday’s post about three US operators announcing flat-rate voice plans, today brings news of the fallout in the market. Many Wall Street analysts speculate that Sprint will undercut the other operators and could offer unlimited voice calls for as low as $60 per month in a bid to stem its subscriber losses. Such a move would virtually guarantee a mobile price war, and further hasten the overall move among the US population away from landlines as well.
The bigger overall effect would be just to hasten the total commoditization of voice service — and increase the immediate need to boost data and content spending.
We’re in for an interesting year, I think.
Industries such as Cable/Broadband have proven that before you can raise rates you must make your offering affordable and attractive to the masses. So far, with high data plans, high SMS fees, and high unlimited calling plans the carriers have prevented the growth they so desire. They haphazardly assumed that their wonderful offerings were “must-haves”. This has proved to be a false conclusion.
By lowering costs so the normob can afford the services, they will soon find that the uptake is strong and swift. It will be after the “addiction” occurs that the carriers will be able to start slowly raising their fees and people will pay. Start by lowering voice and SMS - we all know SMS leads the user into the possibilities of the mobile device and causes the user to see the mobile device as something other then a voice enabler - and have a low data plan and watch the users come in.
Lowering the unlimited minutes is the first step to other plans being lowered and adoption rates increasing.