KDDI to Launch Mobile Communications Plan for PCs

Japanese operator KDDI will launch a mobile data plan for PCs on 21 June. Called LTE Data Pre-paid, it is offered via the operator’s Mobile Communications Plan and is enabled by April 2018 Update. It will be available to subscribers of KDDI and its subsidiary Okinawa Cellular who have Intel-based eSIM-compatible PCs running Microsoft Windows 10 with the latest update, from April 2018.
 
LTE Data Pre-paid makes 4G/LTE high-speed data communications services over the au network (au being the brand name of KDDI’s consumer mobile service) available to domestic users in Japan. Users will not need to purchase a separate SIM card. Additionally, users of both au smartphones and eSIM-enabled PCs who contract for fixed-price data service can “data-share” via the au smartphone and take advantage of the data capacity already purchased. The service will cost JPY 1,500 (US $13.68) per GB, valid for 31 days.
 
The ever-increasing demand for mobile data services includes PCs as well as the more-frequently-used smartphones and tablets. As more and more people expect access to high-speed mobile data at all times and places, on all kinds of devices, the eSIM market constitutes a source of revenue that operators should take full advantage of.
 
Laptop users on the go can get their data from public or private Wi-Fi networks, or by tethering to their smartphones. However, Wi-Fi is often compromised by reduced speeds due to too many users on the network, and tethering has limitations in that PCs may have higher data demands than smartphones do and not all smartphones are capable of being tethered. The eSIM technology, on the other hand, enables laptops to receive data directly from a cellular source. And given the fact that functionalities used on PCs can demand a great deal of high-speed data, we think that operators such as KDDI stand to earn a good deal of revenue from it.
 
Making LTE data available via eSIMs on compatible PCs, therefore, is a good move for MNOs, and doing it on a prepaid, per-gigabyte basis makes a lot of sense. In this case, the pricing is at a reasonable rate. Finally, the data-sharing feature of this offering is likely to be very appealing to subscribers who are already au users, in that they can apportion data allowances that they have already paid for across the two platforms—i.e., smartphone and PC. It would be a wise for operators to introduce offerings such as this one for a greater range of laptops and operating systems.

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 

WhatsApp to Roll out Video Calling

WhatsApp said it will be introducing a new video calling service to its over 1 billion users worldwide on iOS, Android and Windows Phone. The OTT provider stated that the service is meant for every type of phone, from the most expensive to the least expensive. The service will be rolled out to all users over the next few days. According to reports, during a video call, users will be able to switch between the forward-facing and rear-facing cameras, mute the call or press the red button to hang up. WhatsApp, which currently offers messaging and voice calling, says that video calling has been one of the most-requested features from users.   As we have noted frequently in these pages, free or nearly-free OTT services that compete with the offerings of MNOs have been proliferating over the past several years, posing a challenge to the mobile operators. Along with Skype, Facebook-owned WhatsApp has been one of the most vigorous challengers, fueled by its huge worldwide base of subscribers. First with text messaging, then with voice calling, it offered services that closely paralleled or duplicated those of mobile operators. The expansion of high-speed LTE networks (built with the investment of the MNOs) and the increasing availability of budget smartphones have made video calling a possibility for a vast number of users worldwide, so the time is right for WhatsApp to offer it. In this case, however, we do not see it being as significant a competitor to MNOs as with its earlier offerings. While some mobile operators have created native video calling services, for the most part consumers rely on third-party apps for video calling. Probably the company that will be most threatened by WhatsApp’s new offering is Apple, whose FaceTime feature enjoys great popularity. WhatsApp video calling is platform-agnostic, and therefore users no longer have to buy an iPhone to make video calls. The question will be how high the quality of the calls will be, and that will have a great effect on the uptake rate for WhatsApp’s video calling service.

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 Germany and Recogizer Offer Big-Data Analysis

Vodafone Germany, in cooperation with Recogizer Analytics, a German company, is offering an analysis tool for companies using the Internet of Things. Business customers can evaluate large quantities of data from building technology, machines and sensors, with the goal of increasing the energy efficiency of buildings, reducing machine downtime and improving the reliability of installations. With the Big Data Analysis cluster, Vodafone is offering a complete product range consisting of hardware, a Vodafone Global SIM, data analysis collection, secure data hosting on German servers and intelligent data analysis. The service is based on Vodafone’s LTE grid and, in future, will be based on the operator’s 5G network.     This ambitious offering targeted at business subscribers appears to be an excellent way for a mobile operator to create revenue and innovative opportunities for itself beyond traditional mobile services. The rapidly growing IoT sector is already a promising source of revenue for operators, as we have written in the past; providing an analytic tool for the IoT is a new and creative way to grow within that sector. Not only is Big Data Analysis potentially very useful to companies in the building industry and therefore an opportunity to enhance Vodafone’s brand, but the fact that it runs on Vodafone’s LTE network makes it a source of ongoing revenue, a way of more fully utilizing the operator’s capacity, and a way of increasing Vodafone’s customer base (via the Global SIMs). Partnering with a technology company to develop this complex system looks to be a savvy move, and on the whole, we see Big Data Analytics as a likely win-win situation.

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 

Telenor Norway to End 3G Service Ahead of 2G Service

In a recent statement, Bjørn Amundsen, Telenor Norway’s director of coverage, said that within five years the operator’s 4G/LTE network will match its 2G network in terms of coverage. Telenor Norway has already deployed 4G/LTE service in 42 of 87 municipalities in the country’s key northern territories and is on target to cover all municipalities in northern Norway by the end of 2016. Currently, subscribers can only access data on Telenor’s 4G/LTE network, but the operator plans to launch VoLTE before the end of the year. Amundsen also said that the MNO will phase out its 2G network within a decade and will end 3G service sooner than that. It will maintain its 2G network longer than its 3G network due to device compatibility issues and the growing number of M2M services.

Telenor Norway’s prediction that it will end 3G service ahead of 2G service comes as no surprise, as we have seen other operators, such as those in the U.K., state the same thing. In New York, U.S. mobile operator Verizon Wireless has shut off 20 MHz of spectrum that was once allocated for 3G service and is running 4G in its place. The operator is doing the same on its network in Cleveland, OH. Lastly, as we have previously reported, in India, where adoption of 3G networks has been slow, some operators may go directly to 4G from 2G networks, bypassing 3G service altogether. Requiring operators to maintain three networks is very expensive, so it is critical that they choose how to repurpose spectrum based on return of their investment. For most operators, 2G networks are still an important source of revenue, particularly in rural areas, where the return on investment for 4G infrastructure upgrades will not be enough to make it very profitable. In addition, 2G service uses a low frequency, which results in reduced operating costs for MNOs. On the other hand, 3G competes more closely with 4G in that it is data-focused, and with 4G service, operators may be able to upsell users to larger data packages due to the faster speeds it offers. As Telenor Norway begins to refarm its spectrum, 3G service may well be the first to go, mainly to ensure that there will not be any loss of coverage in hard-to-serve areas and to ensure that users with older handsets still receive service. Once its 4G/LTE network can support VoLTE across the country and more users have 4G-enabled smartphones, we may still not see the total elimination of 2G service, because 2G is particularly useful for M2M connectivity, which is in growing demand.

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. Contact Tarifica for a subscription to the Tarifica Alert. 
Tarifica is the 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. Click here to contact a Tarifica Analyst.

Vodafone Romania CEO Calls for Level Playing Field

The CEO of Vodafone Romania, Ravinder Takkar, told a local newspaper that Romania has too many operators and that the current configuration—many market players with high-quality networks and prices that are purportedly the lowest in Europe—is not sustainable in the long term and possibly not even in the medium term. Takkar said he believes that the telecommunications authority should take steps to bring about the strengthening and “recovery” of the industry. Among these would be the “equalization” of rules between mobile operators and fixed line operators and a reduction in the tax burden to encourage investment. Takkar added that in the Romanian telecom market, earnings are too low in relation to investment.

Vodafone is the second-largest operator in Romania, after Orange. It is possible that its CEO believes that if the number of players in the country’s market were to go down, Vodafone would be better able to pick up the new subscribers than its rival, Orange would. Alternately, Takkar’s remarks may truly reflect an altruistic attitude toward the Romanian telecom market as a whole. If may well be the case that if tax laws are changed to encourage investment and regulatory rules are changed so as to create fairer competitive conditions, the market will shake itself out, shedding dead weight and allowing the remaining entities to be healthier and accrue more profits. Whether or not regulators will heed Takkar’s call, of course, remains to be seen.

 

“In the hypercompetitive telecom market, sometimes cooperation makes more sense than competition—or rather cooperation can actually strengthen competition. Whether it is two rival operators, such as Beeline and MTS, working together to build an LTE network that will benefit both, or urging the elimination of unfair regulatory advantages, as in Romania, operators may come to realize that a rising tide can indeed lift all boats.”

Will Watts, Program Manager at Tarifica.

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 or to speak with the research team: http://www.tarifica.com/contactus.aspx

Bouygues Telecom Launches LTE in Channel Tunnel

French operator Bouygues Telecom has launched LTE service in the Channel Tunnel for subscribers traveling from the U.K. to France, using the 1,800 MHz band. The operator said that its customers will be able to access LTE in the northbound side of the tunnel starting in May 2015, due to a roaming agreement to be signed with an unnamed U.K. operator.

Bouygues’ launch of LTE in the Channel Tunnel is part of a roaming partnership with rail operator Eurotunnel and U.K. operators EE, O2 and Vodafone. Bouygues is the only French operator to offer the high-speed mobile service to its subscribers, though for the time being it is only available in the southbound side of the tunnel. The fact that Bouygues rolled out its domestic LTE service on the 1,800 MHz band made it “the natural choice of partner for Eurotunnel, alongside other telecoms operators,” as a press release from the operator stated. Olivier Roussat, Chairman and CEO of Bouygues, said, “For us, it is further proof that our decision to use the 1,800 MHz frequency band was a pertinent strategy.”

Bouygues, as well as French operators Orange and SFR, launched 3G connectivity in the tunnel in the northbound direction in 2012, in time for the London Olympics. Full 3G connectivity in both directions took until May 2014, due at least in part to the technological challenges inherent in routing wireless signals to a tunnel that lies 100 meters below sea level. As of mid-December, subscribers of the three British MNOs have LTE access in both directions of the tunnel.

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 or to speak with the research team: http://www.tarifica.com/contactus.aspx

Telus Makes Misleading Speed Claims

Following a hearing with the CRTC, Canada’s mobile regulator, on whether new regulations on the sale of wholesale mobile service would stimulate competition, MNO Telus issued a press release arguing against the regulations. The operator stated that Canada’s relatively high prices are merited and ultimately provide consumers with much better value. “Canadians enjoy wireless data speeds that are the second fastest in the world,” the release said, adding that Canada has “three times the average speeds offered in the U.S. and France, and nine times faster than the U.K.”

There was, however, a significant problem with the statistics that Telus cited, which was instantly flagged by Canadian media and industry watchdogs: They are based on the operator’s advertised maximum download speeds and not its real-world performance. As a warning against this type of usage, the OECD report from which Telus’ numbers were pulled stated, “Operators in some countries advertise faster speeds closer to the theoretical maximum which are rarely achieved in real usage.” As an example of how different these numbers can be, Akamai Technologies’ State of the Internet report for Q2 2014 states that Canada’s average download speeds were 7 Mbps compared with 6.1 Mbps in the U.K., not the nine times faster that Telus reported. 

We generally concur with Telus in terms of the broader argument that many of the European regulatory measures aimed at keeping costs down for consumers have inadvertently created a perverse set of incentives for operators in which maintaining current prices takes precedence over building next-generation networks. However, Telus’ tactics in this case have been almost comically poor. Due to MNOs’ large size and bureaucratic culture, many journalists and consumer advocacy groups are inclined to paint them as enemies of the consumer that consistently prefer “profits over people.” By manipulating the data in what appears to be the most translucent manner possible (there are multiple well-known and free sources for average download speed), Telus has validated all the fears of MNO cynics and moved popular opinion in the exact opposite direction to that which it intended. As this debate over competition continues in countries around the world, MNOs and their supporters would be well advised to not overreach in the way Telus just did. 

“Consumers tend to have little ability to evaluate network speeds. Most do not know how many megabits there are in a five-minute video. Instead of just listing theoretical maximum speeds, operators should differentiate their plans by describing speeds in practical and concrete terms, for example: ‘Now you can watch Game of Thrones anywhere; on our LTE network, 70 percent of videos stream with no lag.’ This strategy can help operators upsell consumers to higher-speed data packages and strengthen the brand’s association with reliable and fast data performance.”

Will Watts, Program Manager at Tarifica

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

Verizon Wireless to Launch LTE Service for Prepaid Customers

Leading U.S. operator Verizon Wireless is scheduled to begin including LTE service with its prepaid plans starting on 17 July. The Verizon Allset prepaid plan starts at US $45.00 for smartphones, which includes unlimited voice/SMS and 500 MB of data. Customers can purchase Bridge Data packs at US $5.00 for 500 MB, US $10.00 for 1 GB and US $20.00 for 3 GB. Additionally, Verizon has been running a promotion which offers customers who sign up for auto pay an additional 500 MB of data. Combined, a customer could have unlimited talk and text plus 4 GB of data for US $65.00—which is significantly less expensive than its postpaid More Everything plan, which includes the same services. Verizon Wireless is the final US Tier 1 operator to include LTE service with its prepaid offers. AT&T, Sprint and T-Mobile have made this service available since early 2013. Verizon Wireless has yet to announce if its prepaid plans will have their maximum LTE capped (as is the case with AT&T) or if they will run at the network’s top available speeds.

This announcement can be seen as further evidence of the saturation of the U.S. mobile market. Verizon had long focused almost exclusively on driving customers into postpaid 24-month contract plans, relying on its superior network reliability to compensate for its higher prices. While this strategy will still generally remain in place (Verizon’s prepaid plans will still be more expensive than those of its rivals), it appears that the operator has been forced to become much more flexible. Compared with the first quarter of 2013, Verizon saw its postpaid subscriber adds decline by 20 percent and its prepaid customer adds down 76 percent. Beyond the general saturation at the high end of the U.S. market, a confluence of factors has worked against the operator: the availability of better preowned smartphones that do not necessitate operator subsidies, increasing consumer discomfort with committing to long contracts and aggressive smaller operators (particularly T-Mobile) willing to push the envelope in terms of price and included plan features. It appears that its increasing marginalization in the more dynamic prepaid market finally forced Verizon Wireless to risk cannibalizing its own postpaid revenues by offering LTE-enabled prepaid plans.

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

Samsung’s Q2 Profits Below Expectations

Korean device manufacturer Samsung stated that according to its preliminary figures, second-quarter revenues were KRW 52 trillion , down from 54 trillion  in the same quarter last year, and that operating profits fell 23 percent year-over-year, to KRW 7.2 trillion. Analysts had expected profits of KRW 8 trillion. In a statement, Samsung attributed the shortfall to increased competition in China and Europe and to soft smartphone and tablet sales. Samsung’s statement sought to contextualize the disappointing results and sound a somewhat optimistic note for the near future: “The second quarter is a seasonally weak period for smartphone demand in China. Samsung also saw an increase in inventory due to price competition and a weaker demand for 3G products ahead of the expected growth of 4G LTE products in the Chinese market.… The company cautiously expects a more positive outlook in the third quarter with the coming release of its new smartphone lineup.” Nonetheless, the preliminary Q2 figures for the manufacturing giant tell a larger story. One cause of Samsung’s difficulty is the rise of the big-screen (5- or 6-inch) smartphone, sometimes known as the “phablet,” which has been championed by none other than Samsung. Such devices have been cannibalizing tablet sales. In addition, with the maturation of smartphone technology, users are finding that their devices have sufficient functionality and durability that they do not have to upgrade them as often as before. And finally, Samsung and other high-end device manufacturers, such as Apple, are finding their domain encroached upon by cheaper and simpler handsets that, with the advance of technology, can now perform enough key smartphone functions to deter many consumers from spending the extra money on a state-of-the-art phone. The Samsung Q2 figures are by no means the last word on the Korean giant’s business, but they are part of an evolving narrative about the maturation of the worldwide device market.

The above item appeared in a recent issue of Tarifica's "The Story of The Week", a weekly report that analyzes noteworthy developments in the telecoms industry from around the world. For past issues or to learn more about The Story of The Week :  http://www.tarifica.com/storyoftheweek.aspx