ICE Mobile Plans Offer Top Value to Costa Rica Consumers

Tarifica has announced the latest Tarifica Score™ measure of consumer value for postpaid mobile plans in Costa Rica. (Tarifica Score values range from 0 to 100). Tarifica applies its “Top Value Plan” designation to the highest scoring plan in each of ten market segments which consist of two types of plans: SIM-only and ‘with phone.’

ICE captured nine of ten top value plan positions in both categories (SIM-only and ‘with phones’) due to its effective promotions, competitive prices and unlimited 3G data plans. Melissa Mascarenhas, Tarifica analyst for Latin America, noted, “There are two ICE promotions that helped it achieve the top value position in so many segments. The first promotion charges customers once every 90 days for purchasing 4G LTE instead of every 30 days, thus reducing the cost by two thirds. The second promotion offers customers 3 GB of 4G LTE for 4 months free when they purchase a 4G compatible device with a Conectado, Profesional, or iPhone plan.”

All of Movistar’s plans in the SIM-only category score below 50 points. While the operator has competitive prices, its moderate speeds and limited data allowances put all of its SIM-only plans on the lower end of the Tarifica Score spectrum. However, Movistar landed the top value position in the ₡35,001 to ₡45,000 segment with its Plan 4G @ 5 in the ‘with phone’ category.

While Claro offers flexible plans that allow customers to ‘build their own plans’ the Tarifica Score reveals that the unit price of these plans is consistently higher than the Top Value plans from other operators. As a result Claro does not have any top value plans in the SIM-only category and only three of its plans score above 50 points.

The overall top plans for all operators in the SIM-only category are on the very low end of the price spectrum and have fairly low data speeds. High speed data generally increases a plan’s value but the high price of 4G in Costa Rica offsets the added value of its high speed.

“In today’s mobile marketplace, consumers are flooded with hundreds of plan variations and constantly shifting promotions and deals—the majority of which come with different costs and services, and access networks of differing strengths. Operators can use Tarifica Scores to help consumers cut through the clutter and identify those plans in every market segment that offer the best value for the money,” Tarifica Program Manager, Will Watts.

Tarifica, a unit of T3i Group, has been the leading provider of telecom pricing information for close to four decades. It maintains the most robust, in-depth and up-to-date pricing database in the industry, which includes mobile and fixed line rates from over 400 operators in 85 countries, as well as historical data going back to 1997. Tarifica also produces reports, surveys, publications and custom analyses. Its clients include carriers, regulators, enterprises and consultants in every region of the globe. For more information, please visit www.tarifica.com. Tarifica also maintains a presence on the following social media platforms:

Costa Rican Regulator Proposes Changes to Data Pricing

Costa Rican regulator Superintendencia de Telecomunicaciones (Sutel) has decided to hold a public consultation on the subject of the possible introduction of a flat rate for mobile internet services for postpaid consumers, based on the amount of data used. The scheduled date for the consultation is 1 July 2014, and Sutel will have one month to respond to the issues raised, after which it will make a decision on the proposed tariff plan. The scheme would involve users being charged a rate of CRC 0.0075 (US $0.0001) per KB regardless of transmission speed. Operators will also be obliged to offer a basic plan for CRC 3,750.00 (US $6.61) that would offer a data allowance of 500 MB, with the proposed data billing rate applying for excess usage. This method of pricing for data use has only been applied to the prepaid sector so far and was implemented by carriers as recently as mid-2013.

Since the liberalization of the telecom market in late 2011, Costa Rica has seen substantial growth in terms of subscriber numbers and competition. In a country where fixed broadband penetration is only around 10 percent, mobile devices are the primary source of internet access. A recent report from Sutel indicated that as of the end of June 2013, nearly 88 percent of Costa Rica’s 3.99 million internet users were mobile broadband subscribers. The number of mobile internet users grew by 86 percent from Q1 2012 to Q2 2013. In fact, with the increasing adoption of smartphones, data usage has also risen considerably. Now operators ICE, Claro and Movistar are faced with the same dilemma as other global operators—that of providing and maintaining quality of service while dealing with an increasingly congested network. ICE introduced a throttling threshold of 6 GB on its Kolbi 3G and 4G unlimited postpaid plans earlier in the year.

Operators in other markets around the world have found that an unlimited model is not sustainable in the medium to long term, especially if the operator has 4G. Many operators have used a 4G launch as an opportunity to move to a tiered data pricing structure. While such a model allows users to choose a plan that meets their needs, it also gives the operator the opportunity to upsell users who regularly exceed their data allowances. Many Costa Rican consumers have voiced concerns over this proposal because they are used to relying on unlimited mobile internet. However, if operators offer appropriately structured tiered plans, the average user may benefit from improved services and better cost control.

The above item appeared in a recent issue of The Tarifica Alert, a weekly resource that analyzes noteworthy developments in the telecoms industry from around the world. To access all of the latest articles and issues:  http://www.tarifica.com/TarificaAlert.aspx