Verizon Wins 5G Speed Race

Verizon is best for 5G speeds in the U.S., while T-Mobile US comes first in 5G availability, according to the latest user experience tests by Opensignal. The results are based on nearly 16 million measurements by 2.4 million devices in the period from 16 March to 13 June. 

Verizon delivered by far the fastest 5G download speed in the country—and indeed across all countries measured by Opensignal. It averaged 494.7 Mbps, compared to 60.8 Mbps for AT&T and just over 49 Mbps for T-Mobile and Sprint. The faster experience at Verizon is largely due to its wider use of mmWave spectrum. 

T-Mobile won in the 5G availability category, as its customers with 5G devices were connected to the 5G network 22.5 percent of the time. Sprint came second with 5G available 14.1 percent of the time, AT&T was at 10.3 percent, and Verizon was at only 0.4 percent, due to the short range of its mmWave spectrum. 

As 5G networks are rolled out across the developed markets, the speed race is on. That is, of course, understandable given that the next-generation technology’s bragging rights are chiefly due to speed. And with ever-greater challenges to bandwidth in the form of video, gaming, music streaming and IoT applications, very high download and upload speeds are bound to be attractive, market-relevant and even essential for many users, both consumer and business.

Verizon’s domination of the U.S. market in terms of speed is certainly striking—nearly 500 Mbps, with its nearest rival at only 60 Mbps. And while many users will not be able to make full use of such a number, or even notice any difference between it and AT&T’s figures in real-life scenarios, it is an impressive achievement that should boost the operator in the marketplace.

However, it appears that the very technology that enables Verizon to leap so far ahead in terms of speed causes a concomitant shortfall in terms of availability, leaving it dead last among the four major U.S. operators. The double-edged sword, so to speak, of mmWave spectrum could cut Verizon cruelly in the 5G wars.

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. 

Learn more about Tarifica at www.tarifica.com.

Court Clears T-Mobile US to Take Over Sprint

T-Mobile US has secured clearance for its takeover of Sprint, after a U.S. federal court rejected an appeal from state attorneys general who opposed the deal. T-Mobile and Sprint, which are the country’s third- and fourth-largest operators, respectively, hope to complete the deal by 1 April, nearly two years after the merger was first announced. 

In the summer of 2019, over a dozen states, led by New York and California, launched a lawsuit against the merger, saying that the deal would reduce competition and result in higher prices for consumers. The states filed the appeal despite the fact that the merger had already secured conditional approval from the FCC—the main U.S regulator—and the U.S. Department of Justice.

T-Mobile and Sprint argued that the merger would help them compete better against market leaders AT&T and Verizon. They also said that it would help them roll out a 5G network and improve broadband services more quickly. The agreements with the FCC and the DoJ included plans to spin off assets to Dish Network, which would thus be enabled to build its own mobile network business and expand broadband coverage in the U.S.  

The judge in the U.S. federal court for the Southern District of New York heard the case in December. The ruling, just published, is that the merger is not expected to significantly lessen competition. 

T-Mobile and Sprint still have certain regulatory formalities to complete before the merger is finalized, such as approval from another court for the settlement with the DoJ. In addition, they must agree to the financial conditions of the all-stock deal, following the fluctuations in their share prices since the merger was first announced in April 2018. 

The proposed—and now all-but-certain—merger between the two smallest of the Big Four mobile operators in the U.S. has been controversial from the moment it was announced. Opponents, such as the coalition of state governments that filed the suit, have argued that the $26.5 billion deal will reduce competition in the U.S. mobile market and thus lead to higher prices and potentially worse service for consumers. The operators, on the other hand, argue that the new combined entity will be able, by virtue of its size, to challenge the Big Two, AT&T and Verizon, with a new level of effectiveness.

In his opinion, the U.S. District Court judge, Victor Marrero, cited T-Mobile CEO John Legere’s disruptive “Uncarrier”strategy. “T-Mobile has redefined itself over the past decade as a maverick that has spurred the two largest players in its industry to make numerous pro-consumer changes,” he wrote. “The proposed merger would allow the merged company to continue T-Mobile’s undeniably successful business strategy for the foreseeable future.” T-Mobile’s hitherto-successful strategy, deployed against the competition with even greater resources at its command, could indeed have a seismic effect on the market, for good or ill. For its part, T-Mobile states that for its existing customers and Sprint’s existing customers, prices for service will either remain the same or go lower over the next three years.

Another touted advantage of the deal is 5G development. FCC Chairman Ajit Pai hailed the judge’s decision by saying that “the T-Mobile–Sprint merger will help close the digital divide and secure United States leadership in 5G.” Wider availability of 5G, and faster rollout thereof, certainly would benefit consumers.

One interesting issue relating the merger has to do with the budget-minded market. Both T-Mobile and Sprint maintained budget brands—Metro and Boost, respectively—that competed with each other in the prepaid sector. If the operators merge, this competition will go away, with the potential that the prepaid market will be underserved. And as the states fear, there could be an upward pressure on prices in general due to the reduction in the number of operators, and that would be particularly bad for the lowest-echelon users.

If this occurs, it could paradoxically open up a new opportunity zone in the marketplace. If the major operators cater less and less to prepaid and other cost-conscious users, MVNOs could enter the breach and get those customers on board. There could be a veritable proliferation of virtual operators in the space, so if the merger goes ahead to completion, as now appears almost certain, we believe that existing MVNOs should watch closely for underserved customers, and entrepreneurs may want to launch virtual brands in the near 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 

Verizon Brings 5G Network to U.S. Shipbuilding Firm

U.S. operator Verizon has brought its 5G Ultra Wideband service to Newport News Shipbuilding (NNS), a division of Huntington Ingalls Industries (HII), in Newport News, Virginia. HII is the largest military shipbuilding company in the U.S. The company said that 5G will enable it to be better equipped to meet network connectivity demands and that it will use the system to test new ways in which its engineers can use augmented and virtual reality (AR/VR) to support everything from architectural design to employee training.

The company will also see how 5G could increase manufacturing efficiencies with automation, advanced robotics, 3D holographic design and real-time analytics, as well as the use of IoT sensors for better decision-making in near-real time.

The shipbuilding company recently started using tablets and smartphones for work at its premises, leading to increased bandwidth needs, network reliability and security.

As the major mobile operators roll out 5G across developed countries, the high-speed network technology remains, for the moment, essentially a niche product that is accessible on a piecemeal basis, in certain localities. At the present time, 5G has not yet taken over from 4G/LTE as a fully realized standard. Controversies remain, too. For example, there is the question of whether governments will allow operators in their countries to use the products of Chinese technology developer Huawei to develop 5G systems, opposition on this point being due to concerns about security risks.

However, 5G can shine right now in specialized, focused applications such as that being offered by Verizon’s to Newport News Shipbuilding. The capabilities of 5G enable the functioning of applications that go beyond the normal purview of mobile telecommunications—AR and VR, holographic design, real-time analytics, robotics, and the like. While these systems may not have been designed by Verizon, the operator’s 5G Ultra Wideband will provide the signal they need. With Verizon’s participation, the shipbuilder will have an open field in which to test and improve cutting-edge solutions.

Partnerships with large enterprises such as this one represent an excellent opportunity for mobile operators. They can have a guaranteed, built-in subscriber base, as well as a way to demonstrate the potential of 5G, which in the future will be utilized by a wider range of users. Going beyond traditional services such as voice and consumer-level mobile data is in any case an important priority for MNOs today, and special 5G collaborations with industrial enterprises allow operators to do just this.

Ultimately, operators should aim to develop or co-develop 5G-dependent functionalities so that they can brand them and own them, thus maximizing their advantage in terms of revenue and intellectual property.

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 

Verizon Wins Public-Safety Contract in Massachusetts

U.S. operator Verizon said that the Commonwealth of Massachusetts has authorized it to offer public safety via the state’s public-safety-grade wireless agreement. Verizon services include Responder Private Core and priority and pre-emption technology for first responders. This is the first state and local agency multi-vendor procurement in the United States for public safety-grade wireless data services.

The data services provided by Verizon feature virtualized, separate LTE core to maximize security for public safety users as well as Third Generation Partnership Project (3GPP) standards to implement Quality of Service (QoS), priority and pre-emption for public safety data communications.

Verizon will provide communications for every jurisdiction, public safety discipline and mobile carrier in Massachusetts. Public safety users responding to major incidents will be able to talk, text, share multimedia and instantly communicate, regardless of their selected public safety grade mobile carrier, plan or device.

This contract, a first in the highly developed U.S. market, seems like it ought to be a gold standard for large mobile operators looking to maximize revenue and lock in a major opportunity for future revenue streams, brand strengthening, and overall relevance in a changing mobile landscape.

We have written on numerous occasions about the need for MNOs to develop new kinds of business and products as the marketplace becomes less hospitable to traditional mobile services as a source of revenue growth. Verizon’s agreement with the state of Massachusetts involves the building out of what amounts to a special LTE network just for first responders and other public-safety entities. It is ingenious not only in its apparent efficacy and security but because it is completely agnostic of carrier or device. This enables Verizon to access a large number of users who must use the service, thus maximizing traffic on the network and in effect creating a user base in every jurisdiction in the state.

In addition to the direct earning of revenue, the implementation of this service could help with acquisition, as the Verizon public-safety network will be used at work by people who are subscribers to other carriers. The public-service nature of the contract also makes it a positive for Verizon, in that it will burnish the operator’s brand identity and thus promote customer acquisition among people who have nothing directly to do with public-safety work.

On the whole, this is a major coup for Verizon, and it is almost surprising that it is the first deal of its kind in the country. Operators there and in other markets should be very interested in arranging similar deals wherever possible.

Tarifica’s products and services are powered by large-scale data from the global telecom industry and a deep level of expertise gained from our singular focus. We leverage these core attributes to help our clients understand their markets and answer their most challenging questions. Our team of analysts, software engineers and data scientists deliver real-time dynamic solutions for the telecom industry. Our software and state of the art data extraction techniques enable our clients to make smart decisions in real-time based on insightful, actionable data. 

We are the telecom plan & pricing experts.

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

Verizon Deploys Video Nodes on Street-Light Infrastructure in Two U.S. Cities

U.S. operator Verizon has deployed video nodes on existing street light infrastructures in two major cities, Boston and Sacramento. These smart lights, powered by technology from U.S. developer Nvidia, are intended to eventually be able to communicate with self-driving vehicles and to support street-light-to-car communication that could help reduce congestion and increase safety for pedestrians and drivers alike. Verizon’s video nodes leverage Nvidia’s Jetson TX1 “mobile supercomputer” to collect and analyze data.
 
Nvidia’s video nodes can accelerate deep learning up to the farthest edges of a city’s network, enabling real-time video analytics. This so-called edge computing can bring about more efficient, near real-time data analysis and less high-cost streaming and storing of video over LTE and Wi-Fi networks.
 
The video nodes capture and classify objects such as vehicles, cyclists and pedestrians and identify interactions nearly in real time, providing city officials with a data stream of everything from illegal right turns on red lights to pedestrian movement outside designated crosswalks to parking-lot metrics.
 
One of the liveliest new areas of opportunity for telecom operators to gain relevance and, eventually, revenue is the IoT and related applications, including, as we see here, urban traffic data analytics. Nvidia’s partnership with Verizon is an example of how an operator can make itself indispensible to the gather of data that will be leveraged by both governmental and private entities to enable functionalities that will have a serious impact on many aspects of everyday life for huge numbers of people.
 
Through this video node street-light initiative, Verizon hopes to make its network indispensible to the gathering and transmission of this kind of data. While no operator, no matter how large and dominant, can expect to control this sector completely, it may be possible to do so within municipalities. Verizon, therefore, will benefit directly from the data service involved, even though the system is designed to minimize cost to the city from data storage over LTE and Wi-Fi. It can also benefit indirectly in terms of brand strengthening, by being visibly allied to cutting-edge developments such as AI and deep learning. And while the future of self-driving or autonomous vehicles is still uncertain due to safety concerns, real-time data analytics will undoubtedly play a pivotal role in urban navigation.
 
With this partnership, speculative and future-oriented though it may be, Verizon is distinguishing itself as relevant to rapidly developing technological trends. How much return it will get on this investment will, of course, depend on how successful Nvidia’s technology is in producing the desired results, and on how many municipalities buy into it and how quickly they do so.

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 

Are you Winning or Losing the Battle of Consumer Mobile Promotions?

Operators, are you asking yourselves the following Strategic Questions?

   • How important are promotions to our customers? 

   • Are we treating promotions as tactical tools or strategic make-or-break business weapons?

   • Are we mainly reacting to the promotions of competitors and accepting the results, or are we implementing our plans and causing the market to react to us? 

   • Are we applying enough resources to managing promotions? Do we want to apply more but are limited by budget constraints? 

   • Do we learn about changes in our competitors’ promotions quickly enough to minimize damage? 

   • Do we have any means to quantitatively compare the consumer value of our promotions with those of our competitors?

 If you are not satisfied with your answers, Tarifica has the tools to help you improve them.

 Research on the Value of Promotions 

Tarifica recently conducted a global survey of consumers and asked:

1. On a scale 1 to 10, how important is it when buying a PHONE that a special deal or promotion is available?
2. On a scale 1 to 10, how important is it when buying a PHONE & PLAN that a special deal or promotion is available?

(1 = not important, 10 = extremely important)

One third of respondents indicated that for both purchase decisions having a promotion was extremely important (response of 10). About three quarters of the respondents indicated that having a promotion was fairly to extremely important for both purchase decisions (responses from 7 to 10).

This completely mature and saturated market has been trained to purchase new phones and plans on promotion because promotions offer great savings. If consumers do not see what they want offered with promotional pricing, they know they only have to wait a short while because this market changes every single day. Only the inexperienced and/or foolish buy retail.

Promotions are the key to maintaining and gaining market share through competitive win backs. However, they can also cut deeply into operators’ profits in an already margin thin business. The challenge for operators is to remain competitive every single day while not cutting profits more than necessary (if at all). The bottom line is that promotions are driving a significant portion of customers’ buying behaviors and operators need to treat this as a strategic element of their business.

Tarifica has developed a service that operators use for both near real time and long term decision making. In the short term it dynamically assesses the competitive promotional landscape enabling operators to take advantage of new promotional opportunities and quickly adjust to meet new promotional threats. Over the long term it enables operators to see the big picture in terms of how promotions evolve and what drives consumer behavior and value.

Tarifica’s Daily Market Tracking Service for Promotions Tarifica’s Daily Market Tracking Service is designed to help operators achieve this balance between managing market share and profitability. This tool provides operators with a daily report on competitive promotions and device prices, enabling them to immediately see what is changing and where they need to reassess their own promotions. A major MNO that uses this report found it to be much more effective, timely and accurate than their internal efforts. While most of this information is available on competitors’ websites, promotions can be hard to find as they are occasionally moved to a different webpage, and are at times ambiguous and even contradictory. Tarifica’s specialists know how to find this information quickly and contact operators via chat and phone when necessary to clarify or validate information. Outsourcing to Tarifica saves operators the cost of hiring, training and managing the necessary resources.

All operators know that the launch of each new high-profile device and/or plan provides a window of opportunity as well as risk. Having immediate information on competitive offers and watching them change every day enables Tarifica’s clients to make strategic counter moves quickly and maximize the upside of such events while minimizing downside risks without significantly increasing the use of internal resources.

An example of this daily report showcasing the US marketing can be seen here. It demonstrates some of the ways this information can be presented. In this format, promotions are categorized by smartphone BOGO, smartphone other, tablet, data plan/network, trade-in and switching operators. Pricing detail is provided for all devices offered and is categorized by smartphones, tablets, smartphones under $10 and prepaid smartphones. Promotion descriptions provide a summary of key elements. All entries are color coded to indicate if they are new and/or if they appear on the competitor’s home page indicating they are expected to be highly attractive.

Many other variations of this information can be provided such as timelines for promotions, indications if promotions have been modified, different device categories (high-end, low-end, accessories, specific manufacturers, etc.), in store or online-only promotions and detailed terms and conditions of promotions, including limitations and restrictions which can be used by operator sales reps to close sales. Report formats and delivery vehicles (e.g., Word, Excel, PowerPoint) are also completely customizable.

Custom analyses of this information are also available, such as comparisons of promotion strengths and weaknesses, price and discount trends by specific models and age of phones, length of promotion periods, promotion modification or turnover rates, etc. Knowing what is happening today, seeing trends as they develop and being able to anticipate the future are key factors in becoming or maintaining a market leadership position.

Further hard evidence of the power of promotions is apparent in Tarifica’s Tarifica Score™ which rates plans based on consumer value. Plans that include promotions are often the top value plans in the market and remain in those positions until another operator offers a better promotion or the original promotion expires. More information on the Tarifica Score can be found  here.

Three quarters of consumers regard promotions as fairly to extremely important in their decisions to purchase phones and mobile plans. Operators need to treat promotions as a strategic element of their business and must focus heavily on managing them in order to remain competitive while minimizing the impact on profitability. The Tarifica Daily Tracking Service can help operators manage both the short-term pressures to optimize the trade-offs between market share and profitability as well as the long-term strategic need to position themselves as champions of consumer value. If you are not satisfied with your answers to the questions posed at the beginning of this paper, contact us and see how Tarifica can be your partner in this battle for consumer spending on mobile services.



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 

T-Mobile Edges Verizon and AT&T in Speed Test

T-Mobile US swept the latest network test awards competition given by Open Signal, the U.K.-based company specializing in mobile network coverage mapping. Rivals AT&T and Verizon Wireless showed a drop in 4G/LTE speeds. In tests conducted in April to June, T-Mobile scored best in availability, download speeds and latency.

Compared to the last tests, which Open Signal conducted in February 2017, Verizon showed a drop in average 4G speed of 2 Mbps, to 14.9 Mbps, which the market researcher said was likely attributable to the launch of unlimited data plans by the operator. AT&T’s speed dropped to 12.9 Mbps from 13.9 Mbps in the previous report. T-Mobile and Sprint, which have been offering unlimited data for a longer period, both showed improved average speeds of 17.5 Mbps and 9.8 Mbps, respectively.

T-Mobile also became the first U.S. operator to surpass the benchmark of 90 percent 4G availability in the tests, achieving 90.9 percent. Verizon was close behind with 4G available 89.8 percent of the time.

T-Mobile’s “Un-carrier” strategy has been widely noted for its aggressiveness in terms of plan features and pricing, and indeed has transformed the U.S. mobile market, with rival operators having to follow suit by offering no-subsidy smartphones and similar unlimited offerings. However, the major countervailing factor has been the perception that T-Mobile’s network did not match up to its plans, or even that the advantages of its generous plan features would be vitiated by the lack of quality and coverage of its signal. The recent test by Open Signal, while certainly not conclusive, strongly indicates that this is not currently an issue.

Open Signal itself acknowledged that T-Mobile may be getting higher ratings on availability due to its focus on urban areas. In the 4G speed category, Verizon won in six markets and tied for the top spot in 24 markets, while T-Mobile won in four markets and tied for the top in 25 markets.

In any case, this test is a timely reminder that as operators compete to devise ever-more creative plans with novel value-added features to lure customers, network performance is key and cannot be neglected. Consumers need speed, coverage and reliability; if these are not sufficient, any operator is likely to lose its competitive advantage.

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 

T-Mobile Bids Big in U.S. Spectrum Auction

When the 600 MHz broadband auction held by the United States regulator, the Federal Communications Commission (FCC), closed late last week, T-Mobile US was the biggest winner, having bid US $8 billion for over 1,500 wireless licenses. In doing so, the operator acquired 45 percent of all the low-band spectrum sold, more than any other company (competitors Verizon and Sprint declined to bid, while Dish Network spent US $6.2 billion). According to T-Mobile, the purchase will quadruple its low-band holdings and allow it to cover 100 percent of the U.S. and Puerto Rico. The operator also said that it will be putting some of this new spectrum to use during 2017.
 
This major investment shows that T-Mobile is planning to take its fight against the big two of AT&T and Verizon Wireless to the next level. After years of unconventional, aggressive “Un-carrier” moves to gain market share, the operator now needs to consolidate its gains. Unlimited data offers, low prices, and a plethora of marketing bells and whistles have pushed T-Mobile from fourth place to third among U.S. mobile operators. Now, in order to have any chance of going farther, the company must provide better connectivity, since network quality and coverage have been the most important factors in motivating AT&T and Verizon customers to resist T-Mobile’s siren call.
 
In his characteristic hyperbolic style, T-Mobile President and CEO John Legere said, “This spectrum sets us up to bring the Un-carrier—and REAL competition—to wireless customers everywhere, many of whom have never had real choices in wireless. If the duopoly [meaning AT&T and Verizon] thought things were rough before—well, just wait!”
 
Legere went on to characterize T-Mobile’s spectrum acquisition as putting it ahead of the competition in terms of technology. Its customers, he said, “will be able to speed on a brand-new, wide-open wireless freeway, while carrier customers have to crawl along on their clogged, congested, low-band freeways.” Low-band spectrum is indeed valuable because of its ability to travel great distances and penetrate structures, and T-Mobile claims that it “now has significantly more low-band spectrum per customer than any other major provider and nearly TRIPLE the low-band spectrum per customer than Verizon.”
 
Of course, it should be kept in mind that T-Mobile’s customer base is smaller than those of the “duopoly.” Regardless of whether the claims about spectrum per customer are accurate, the fact remains that in making this US $8 billion investment, T-Mobile is playing catch-up. To challenge the big two, it must bring high-quality LTE coverage to more people in more geographic regions.

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 

New FCC Chief Targets Net Neutrality

The U.S.’s new chief telecom regulator, FCC Chairman Ajit Pai, last week moved quickly to close down an ongoing investigation into zero-rating practices among U.S. operators AT&T, Verizon and T-Mobile, indicating that he would indeed pursue the deregulating agenda that observers predicted he would. Pai said that zero-rating of services such as video streaming was popular with consumers, in particular low-income consumers. He also stated that he disagrees with the policy, championed by former FCC chief Tom Wheeler, of deeming broadband a utility—which would provide a strong legal basis for net neutrality. While specific new regulations have not yet been announced, and while any changes to net neutrality will involve significant legal challenges, Pai has made it clear that he will be a strong advocate against the present conception of net neutrality in the U.S.

Ajit Pai, a former attorney for Verizon, seems to be fulfilling expectations (including our own in these pages recently) that he would apply the deregulating agenda espoused by his boss, President Donald Trump, to the U.S. telecom landscape. While consumer advocates are decrying his approach as favoring corporate interests over the interests of the people, Pai’s intentions will likely generate policies that will benefit mobile operators and others internet service providers. Zero-rating and other forms of special treatment that operators can give to content providers are sources of revenue—in terms of fees paid by content providers and in terms of subscriber retention and acquisition—and sources of brand strength for operators. If Pai is able to enact his intentions, the only thing operators will need to be keenly aware of is whether in fact they are in fact giving customers what they want, or whether the preferential treatment given to certain entities ends up alienating customers, current and potential.

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 

Verizon Announces Acquisition of Yahoo’s Web Assets

As we have pointed out on numerous occasions, as traditional mobile services approach commodity status, operators have become aware that content is king. Content, in fact, is the key to future revenue growth, and in order to have access to that content, operators must either license it or purchase it. Very few telecom players in the world have pockets as deep as Verizon, and given its assets of US $220 billion, the U.S. giant has the ability to spend generously for the assets it needs. The price tag of nearly US $5 billion for Yahoo’s web properties may seem high, but it represents a tiny fraction of the internet company’s one-time valuation of US $125 billion. Yahoo has declined precipitously since its glory days during the first internet boom, but it still has much to offer. In particular, it should significantly bolster the video content portfolio that Verizon began building with its acquisition of AOL. Verizon CEO Lowell McAdam said, “By acquiring Yahoo’s operating business, we are scaling up to be a major competitor in mobile media. Yahoo’s operations provide a valuable portfolio of online properties and mobile applications, which attract over 1 billion monthly active consumer views.” He added, “Going forward, this acquisition will put us in a great position as a top global media company and give us a significant source of revenue growth for the future.” Both Verizon’s cable and mobile businesses can benefit significantly from this acquisition, as long as the operator deploys the content in a way that meets the ever-evolving demands of consumers. But whether the operator can truly compete with Google and Facebook in the realm of content delivery remains to be seen.

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 

Sprint Launches Rollover Data For Prepaid Customers

According to Angela Rittgers, vice president of marketing for Sprint Prepaid at U.S. mobile operator Sprint, Sprint prepaid rolling data will be available on Sprint prepaid monthly plans and will not expire. Sprint now offers up to 30 GB of rollover data with three of its prepaid plans, which can be purchased at Best Buy. All three plans, which are called Monthly Rolling Data, have unlimited voice and SMS and include either 1 GB, 3 GB or 6 GB of data and cost US $35.00, US $45.00, and US $55.00, respectively. There is no expiration date, as the data will roll over indefinitely as long as the subscriber stays below the 30 GB cap. Sprint indicated that this offer will only be available for a limited time but did not say when it would expire.

We do not know whether this move by Sprint will increase its subscriber base and enable it to be more effective in the very competitive U.S. mobile market, but considering Sprint’s historically subpar coverage, it seems counterproductive for the operator to focus on rollover data offerings instead of bettering its service. If Sprint does not improve coverage, this offer is unlikely to be worth much to customers. In addition, we would not be surprised to see the other major U.S. operators eventually counter Sprint’s prepaid rollover deal. Currently, the available options for rollover data from major U.S. operators are as follows: AT&T’s rollover data expires within one month or with any change in plan. T-Mobile’s Data Stash, which holds data for one year, is only available to subscribers who purchase the 3 GB monthly plan for US $60.00 or a more expensive plan. As for Verizon, according to remarks CFO Fran Shammo made during an interview this past January, the carrier will not be following AT&T and T-Mobile’s lead in providing rollover data. However, we would not be surprised if at some future point limitations on rollover data were to be removed by all the U.S. operators, as has happened with voice and SMS.

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.

Redefining a Mobile Service Provider

There is a paradox at the heart of the mobile telecom industry. Despite skyrocketing data use and proliferation of connected devices, the industry is facing a structural crisis that raises serious questions about its sustainability and growth. With mobile penetration rates in almost all markets well above 100 percent, competition among MNOs has grown fiercer and more focused on price reductions. Traditional sources of revenue have been undercut by OTT services such as WhatsApp and Skype. The increase in consumer data usage has been a mixed blessing in that it has placed pressure on operators to make expensive improvements to the capacity and coverage of their networks. Finally, national regulators have become increasingly activist with regard to pricing, M&A activity and service requirements, further increasing costs for providers.

In the face of this paradox—increasingly large amounts of money flowing through the mobile industry while operator revenues grow ever flatter—we expect to see new business models, revenue drivers, pricing strategies and even leading players. Ultimately, the results of these changes could be the redefinition of the term “mobile service provider.” We have already begun to witness the first steps of this process. MNOs have worked to reevaluate their core offerings in order to find new sources of revenue or to reduce churn. The defining trait of 2014 was MNOs’ drive to acquire the infrastructure needed to offer converged packages. Operators around the world—but particularly in the hypercompetitive European markets—pushed to lock in customers and raise monthly spending by offering quad (mobile, fixed voice, broadband and cable television) packages. Further, non-core value-added elements like Spotify, Netflix and other content-driven services became increasingly important in plan construction, forcing operators to branch out into new partnerships and ventures.

A dramatic recent example of this occurred in the U.S. with Verizon’s US $4 billion acquisition of AOL—a play to secure AOL’s mobile ad software, more proprietary content and new revenue streams in an increasingly competitive market. This type of news is an illustration of how the distinction between content creators, information aggregators, device manufacturers and service providers continues to grow blurrier. Just as we expect mobile operators to be packaging more non-traditional features in with their mobile packages, we believe that there is an opportunity for other types of companies to enter the mobile services space and use these services as a way to augment their traditional packages.

With Facebook’s acquisition of WhatsApp and Google’s ever-expanding reach across all realms of digital life—including its recently launched U.S. MVNO running on the Sprint and T-Mobile networks and its discussions with Hutchison Whampoa for international expansion—we would not be surprised to see either of these entities begin to pivot increasingly into mobile service as an add-on to their traditional offers. While projects like Google Loon/Fiber and Facebook Zero made headlines before retreating from the industry consciousness, the economic conditions that initially drove these initiatives remain—giant internet content providers that have significantly higher margins are growing impatient with mobile and broadband providers’ ability to connect their potential customers. Further, MVNOs like FreedomPop are experimenting with new business models like ad-based data sales. Finally, whether through mesh networks, ever-expanding Wi-Fi hotspots or new technology solutions, MNOs’ hegemony over mobile data is likely to be challenged in the coming years. The high and growing demand for large volumes of fast data makes the industry a prime target for disruption if an adequate alternative presents itself.

There are so many variables in play that it is impossible to make a firm prediction as to the precise long-term evolution of the industry. However, this much is certain—for MNOs to be successful in the future they will have to be adaptive and flexible in terms of developing new revenue streams and fending off non-traditional rivals. Maintaining outmoded plan structures and customer acquisition strategies will almost inevitably lead to painful disruptions. The current structural and competitive environment have the potential to change the core MNO business model in a way not seen since the launch of the iPhone in 2007 and the beginning of the mobile-data revolution. As such, strategic choices made by operators in the coming years will have an outsized impact on the future of the industry as a whole.

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. Click here to contact a Tarifica Analyst