When Lower Prices Aren't Enough

Spanish MVNO Tres (Telefonia REpresentativa Solidaria) Telecom has adjusted its range of mobile, convergent and fibre-only plans just one month after launching them, by substantially reducing prices and removing some deposits. Tres, a self-described non-profit operator, charges customers a monthly fee of EUR 3.00 (US $3.19) to become a member, with no additional fee required for more mobile lines.

Users can now sign up to an entry-level plan with 33GB of 4G data on the Vodafone network for EUR 4.95 (US $5.26) a month, instead of EUR 6.95 (US $7.39). The 99GB plan now costs EUR 7.95 (US $8.45), down from EUR 9.95 (US $10.58), the unlimited data one is now EUR 16.95 (US $18.02), down from EUR 17.95 (US $19.08), and the unlimited 5G data plan now is down EUR 1.00 to EUR 21.95 (US $23.33). All plans come with unlimited calls and SMS as well as rollover data, with new subscribers no longer needing to pay a two-month advance ‘deposit’ on the chosen rate.

The rate for the operator’s fiber plan with symmetric (download and upload) speeds of 333 Mbps has also been cut from EUR 22.15 (US $23.55) to EUR 19.95 (US $21.21) per month. A deposit is still required for these plans, but it is automatically reimbursed after 6 months.

Such a swift change in a telecom’s pricing structure is unusual; Tres Telecom only introduced their portfolio of plans a month ago. The most likely reason for the change is that Tres isn’t attracting enough new customers as quickly as they expected.

Like many no-frills MVNOs, Tres is learning that low price points (even those as low as Tres’ initial offerings) isn’t typically enough to get users to make the switch. More innovative services, targeting and pricing is needed to motivate customers to change providers. Of course, those things require more investment, which may necessitate slightly higher prices, even with the monthly membership fee. It will be interesting to see which direction Tres will choose.

Tarifica is a global SaaS company and a market leader in the real-time collection, analysis and delivery of telecom plan and pricing data worldwide. Through a mix of AI, modeling and market expertise, Tarifica tracks hundreds of thousands of plan and pricing data points daily. No other company tracks more. Tarifica's mission is to continuously convert data into the dynamic intelligence that fuels opportunities for its clients, the world's leading operators, regulators and consultants.

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