T-Mobile and Verizon Wireless Lead US Carriers in Consumer Value

Tarifica has announced the latest Tarifica Score™ measure of consumer value for postpaid mobile plans in the United States. Tarifica applies its “Top Value Plan” designation to the highest scoring plan in each of 20 market segments which consist of four types of plans: individual/family and with/without phone.

T-Mobile had three of the four highest scoring plans in the market. “The only strike against T-Mobile is its relatively weak coverage but this was more than offset by its many strengths such as aggressive pricing, discounted line fees for multiple users, relatively fast download speeds, generous data allotments and bonus inclusions such as data stash, unlimited streaming music and free roaming,” said Tarifica analyst Jamie Davella. T-Mobile would have likely won more than five price segments but it did not have plans in many of the higher priced categories.

Although Verizon Wireless’ top plans did not rank as highly as T-Mobile’s, the carrier’s offers were impressive, receiving nine Top Value Plan designations, including 70% of the designations for individual plans. “Verizon offers high customer value plans across the vast majority of price points. Verizon’s success was driven by the strength of its network. The carrier’s reliable coverage and fast average download speeds were enough to more than outweigh its relatively high prices,” continued Davella.

AT&T ranked third with four Top Value Plan designations. The carrier struggled to compete against the aggressive pricing of Sprint and T-Mobile in the lower cost segments and was slightly behind Verizon on coverage and download speed which hurt its higher end plans. Sprint finished last, winning only two Top Value Plan designations as it had the lowest ratings for both download speed and network coverage. These limitations were too much to overcome for even some of its most aggressively priced plans.

The Tarifica Score is an advanced algorithm used to evaluate mobile plans based on the value they offer consumers. It incorporates every aspect of each mobile plan (including usage allotments, geographic coverage, data speeds and additional features) and weighs them against each plan’s total costs to determine its relative consumer value.

“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,” stated Tarifica Program Manager, Will Watts.

Tarifica Scores were calculated for all the published plans offered by Verizon Wireless, AT&T, Sprint and T-Mobile. ‘With phone’ plans were scored with the iPhone 6. Scoring is based on the total cost of service and device, incorporating all upfront and recurring charges. Shared plan scores were based on four users per plan.

For more information, please visit www.tarifica.com

       

       

       

TeliaSonera Offers the Top Value Mobile Plan

Tarifica has announced the latest Tarifica Scores for postpaid mobile plans in Finland.

The Tarifica Score™ is a proprietary algorithm used to evaluate mobile plans based on the value they offer consumers. It incorporates every aspect of every postpaid plan (including usage allotments, geographic coverage, data speeds, value added features and promotional elements) and weighs them against each plan’s total cost to determine its consumer value. Scores range from 0 to 100.

TeliaSonera’s Jätti-X Nuorelle plan for Young People is the Tarifica Top Value Plan in the country, while DNA’s Äly 50M and Elisa’s Saunalahti Tarkka 4G (Bonus) represent their highest scoring plans, ranking second and third, respectively. Jamie Davella, Tarifica’s Finland Analyst explained, “DNA’s and Elisa’s best plans are comparable to each other in total consumer value, and both are similarly priced to TeliaSonera’s winning offer. However, neither comes with any voice or messaging allowance – they are essentially pay-as-you-go options – while TeliaSonera offers unlimited quantities of both in its top plan.”

While TeliaSonera’s plan for young people (ages 18 to 25 years) has the best overall value due to its special promotional pricing, the operator also has the second highest value plan - Jätti - Sopiva minulle, which is similarly on promotion. All of TeliaSonera’s plans received extra value due to their ‘roam like home’ functionality which enables users across six Nordic and Baltic countries to have the same charges for voice, messaging and data services as in their home country. Davella continued, “When looking at the Finnish mobile market, we conclude that all three operators offer good consumer value, but TeliaSonera noticeably bests its two rivals in that regard.”

DNA has the Top Value Plans in the ‘under €10’ and ‘€31 to €40’ monthly price segments, while Elisa, which has respectable scores, does not have a Top Value Plan in any category. DNA and Elisa have the fastest download speeds which helped DNA’s Rajaton 4G plan secure the top value spot in the ‘€31 to €40’ segment, but this was the only high speed plan with a top value rating.

“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. When making a decision that will likely impact them for up to two years, consumers can use Tarifica Scores to cut through the clutter and identify those plans in every price segment that offer the best value for the money,” stated Tarifica Program Manager, Will Watts.

To Contact The Tarifica Research Department: 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