LONDON-The cost of sending 10 megabytes of data across a GPRS network has fallen by about 40 percent in Western Europe, according to a new report from Strategy Analytics.
The report studied price changes between May 2003 and August 2004.
“The average cost of transporting 1 Mb of data on pay-per-use GPRS plans has fallen by only 13 percent since May 2003, to just over $18,” said Phil Taylor, service director at Strategy Analytics. “At these rates, a single MP3 music track downloaded over the cellular network would cost over $25.
“With over 85 percent of GPRS users on pay-per-use plans, operators need to find ways of making data services more affordable to the mass market,” he said.
Some carriers have noted this pricing issue, according to the report. The United Kingdom’s new entrant 3 advertises that its price plans are based on a simple and transparent event-based charging system linking payment to specific items of content, according to the report.
“Operators are beginning to realize that packets and megabytes are alien concepts to consumers,” said David Kerr, vice president of Strategy Analytics’ Global Wireless Practice. “More importantly, they do not extract maximum revenue from the services themselves.
“Although volume price plans still dominate the GPRS and CDMA 1x charging environments, there is a perceptible move toward value-based pricing and the removal of transport charges on the higher bandwidth services offered by carrier retail portals,” continued Kerr. “The leading Asian network operators, such as SK Telecom and NTT DoCoMo, still seem wedded to the use of complex volume-based transport plans, however, we believe that in Europe, value-based pricing will see increased use, particularly as consumer 3G service launches ramp up in Q4 of 2004 and 2005.”
