AT&T Mexico Offers Video Bundle for Top-Ups

AT&T Mexico has recently launched a new offer in which all prepaid customers who top up by at least MXN 100.00 (US $4.63) will receive a free 7 GB data bundle for streaming video content. The bundle is advertised as being for use on YouTube, but it can also be used to access other platforms such as Netflix, Amazon Prime and HBO Go, albeit at 480p rather than HD quality. The promotion will run until 9 January 2020.

The U.S.-based operator added 668,000 Mexican prepaid customers from September 2018 to September 2019 to reach an overall customer base of 18.6 million, up 7.6 percent year on year.

Formed from the merger of operators Iusacell and Nextel under the aegis of the U.S. operator AT&T, AT&T Mexico has been in business for five years and during that time has come to control the majority of the country’s spectrum. The operator has achieved success in part by leveraging the close ties between Mexico and the U.S., offering customers on either side of the border advantageous deals on service and effectively unifying the two countries into one service area.

As Mexico is a developing market, there is strong support among customers for prepaid service, and AT&T has seen a significant uptake in that regard, with 668,000 new prepaid customers added over the past year, approximately. However, one issue with prepaid customers is that while they technically have the service, they may not be using it very much or even at all. Having the holders of AT&T SIMs not using those accounts is a problem that the operator seeks to remedy by incentivizing those subscribers to utilize the network.

Under the current offering, the incentive to spend at least MXN 100.00 is the gift of 7 GB of free data. That is a generous offer, in our view, especially given the fact that the amount of money in question is actually fairly modest. Promoting the data as being specifically for YouTube and then allowing it to be used for other streaming services is a clever approach, as it creates the feeling that the other uses are above and beyond expectations. Ordinarily, the lack of HD would be a distinct strike against this offering, but in context we do not think that it will be. These prepaid customers who make little use of their service are likely to be relatively undemanding in terms of image quality and will probably be thankful to have a free 7 GB of access to video streaming content.

If the offering proves persuasive, it should have the effect not only of stimulating spending on the part of the prepaid customer base but also of maximizing utilization of AT&T’s network, which is of course a desideratum for any mobile operator.

Tarifica is the global leader in monitoring and analyzing telecom pricing. Covering hundreds of operators in every region of the globe, Tarifica’s databases of mobile and fixed line data and voice tariffs are among the largest and most in-depth in the world. Tarifica is also a leading publisher of benchmark and other pricing reports, and its analysts are recognized authorities in the telecom industry, relied upon by operators and businesses worldwide for pricing insight and guidance.  

To learn more about Tarifica, please visit www.tarifica.com 

Vodafone Spain Bundles One Year of HBO with Prepaid Plans

Operator Vodafone Spain offered one year of free access to the HBO España video-on-demand service to new customers who subscribed to its Superyuser and Megayuser prepaid plans between 20 November and 27 November. The latest promotion in the operator’s “Black Friday” campaign allowed new customers to activate the HBO España service for 12 months by 31 January 2018, as long as they remain subscribed to the chosen tariff.
 
HBO España was launched as a stand-alone VoD platform in May 2016 and reached 414,000 Spanish households at the end of June 2017.
 
Prepaid plans are a good way for operators to gain customers who, mainly for budgetary reasons, want the flexibility and short-term, non-binding nature of such offers. The down side, from an operator’s point of view, is the relative impermanence of prepaid customers. Converting such customers to long-term subscribers has always been a priority with operators, and the current HBO promotion from Vodafone Spain is intended as a means of getting prepaid customers to stay on longer. And if they do, there is more chance that eventually they could be converted to postpaid.
 
One year’s worth of cost-free access to HBO España is quite a generous offer, in our view. To keep it, though, new subscribers need to remain in their prepaid plans. So there is a significant incentive here for them to keep subscribing for at least a year. That is ample time for them to form a relationship with the operator that they may well wish to continue and even deepen in the future.

Tarifica is the global leader in monitoring and analyzing telecom pricing. Covering hundreds of operators in every region of the globe, Tarifica’s databases of mobile and fixed line data and voice tariffs are among the largest and most in-depth in the world. Tarifica is also a leading publisher of benchmark and other pricing reports, and its analysts are recognized authorities in the telecom industry, relied upon by operators and businesses worldwide for pricing insight and guidance. 

To learn more about Tarifica, please visit www.tarifica.com 

Hrvatski Telekom Introduces Zero-Rated Streaming

Croatian operator Hrvatski Telekom has become the latest member of the Deutsche Telekom group to introduce a new mobile tariff with unlimited streaming for selected applications. Aimed at the youth market, the monthly plan comes with 3 GB of data, unlimited on-net calls, 400 minutes and 400 SMS to other networks, and rollover of any unused minutes, SMS and data to the next month. The main novelty is the unlimited use of YouTube, Netflix, HBO Go and Pickbox via the Stream On service, without consuming the data traffic included in the package. The new plan costs HRK 149.00 (US $21.67) per month.

While some countries restrict zero-rating because of concerns about net neutrality, in those markets where it is feasible, operators may offer free access to apps and services of their choice as a way to incentivize potential customers to subscribe as well as to promote habits of more intensive data use.

Hrvatski Telekom’s Stream On service is quite generous in its offerings—several premium and very popular music, video and movie apps that are bound to appeal to young customers. And as we have shown on a large number of occasions, the youth market is a key one for operators to target and cultivate with carefully tailored offerings. Providing youth with affordable plans is an excellent way to foster long-term brand loyalty and keep customers on board until the time when they are able to spend more. Furthermore, and most importantly, while revenue is arguably lost by zero-rating (which of course brings in “zero” revenue), it is likely to be made up and then some in the long run, when the customers are upsold to more expensive plans without zero-rating. We have seen that free access to selected streaming can cultivate larger appetites for data consumption, so promoting the use of data-hungry apps through these giveaways is a solid investment in the future.

Tarifica is the global leader in monitoring and analyzing telecom pricing. Covering hundreds of operators in every region of the globe, Tarifica’s databases of mobile and fixed line data and voice tariffs are among the largest and most in-depth in the world. Tarifica is also a leading publisher of benchmark and other pricing reports, and its analysts are recognized authorities in the telecom industry, relied upon by operators and businesses worldwide for pricing insight and guidance.

To learn more about Tarifica, please visit www.tarifica.com 

California Cities Mull Tax on Streaming Content Services

About 40 municipalities in the state of California are considering imposing a tax on internet-based content services such as Netflix, Hulu, Amazon Video and HBO, according to news reports. In doing so, they would be following the lead of the city of Pasadena, which has already announced that effective 1 January 2017 there will be a 9.4 percent tax on each of these services. The stated purpose of the tax is to replace revenue lost to “cord cutting.” Currently cable TV services are taxed on the municipal level in California, whereas internet video content streaming is not, so when people terminate their cable subscriptions in favor of OTT providers, the given city loses a tax stream. The so-called “Netflix tax” is provoking opposition from at least one industry group, the Internet Association, whose spokesman, Noah Theran, said, “Websites and apps are not utilities and it defies logic to tax them like electricity, water or gas.”   We agree with Mr. Theran that streaming content services are not utilities. In fact, it has been precisely the fear of being demoted to utility status that has been motivating mobile operators to partner with streaming content services and even to create their own. While the Pasadena tax initiative appears to target only broadband access to these services, it could conceivably open the door to taxation of mobile streaming, as well. Such taxes, by increasing the total cost of services, could end up driving away some subscribers and therefore are a potential threat not only to the entertainment content providers but also to MNOs. And if MNOs (or, for that matter, fixed line operators) were to mount a legal challenge against a “Netflix tax,” we believe it would not be difficult to argue that such a tax, by discriminating with regard to certain kinds internet traffic, violates U.S. federal net neutrality rules.

Tarifica is the global leader in monitoring and analyzing telecom pricing. Covering hundreds of operators in every region of the globe, Tarifica’s databases of mobile and fixed line data and voice tariffs are among the largest and most in-depth in the world. Tarifica is also a leading publisher of benchmark and other pricing reports, and its analysts are recognized authorities in the telecom industry, relied upon by operators and businesses worldwide for pricing insight and guidance. To learn more about Tarifica, please visit www.tarifica.com