De Croo claims that Belgium is an expensive country for mobile data and that its mobile data usage is lagging other countries. Using data from Telecompaper’s latest EU Benchmark report on mobile pricing we take a look at whether this claim holds up. In general, the Q1 data shows that Belgium is indeed an expensive country for certain types of Sim-only plans. However, the costs in Belgium are quite average compared to other Western European countries for larger plans with more than 1,000 minutes and more than 10GB.*
The EU Benchmark report shows that the plans on offer by Proximus, Orange and Telenet (including BASE) mostly come with either 1-360 minutes and various MBs (47% of plans) or with more than 1,000 minutes and various MBs (41% of plans).
On the lower minutes range, the costs in Belgium are quite average for 1-2 GB per month when compared to the other 15 countries in our study where such plans were available. Only one country was slightly cheaper (Ireland), and one the same (Netherlands) as the median cost in Belgium, while three were more expensive (Germany, Portugal and Greece). However, when including more data, Belgium becomes more expensive than any of the other countries with such plans. Furthermore, in Q1 2018 there were no plans in Belgium offering 1-360 minutes and more than 10 GB per month.
For Sim-only plans with more than 1,000 minutes per month, we found Belgium consumers could not buy such a plan with less than 5 GB. For this minute range and a data allowance of 5-10 GB, Belgian prices were on the expensive side, with only Germany, Norway and Greece more expensive. However, for the largest type of plan in our research (>1,000 minutes and >10GB), Belgian prices were in line with the average of the 16 countries, with seven countries cheaper but eight countries more expensive.
Considering the Belgian government’s aim to increase smartphone penetration and mobile data usage, Belgium’s benchmark performance for the largest plan is encouraging, as reasonable prices for larger plans should help to entice more consumers to upgrade.
Data usage in Belgium similar to Netherlands
We can also take a look at De Croo's claim that mobile data usage in Belgium is lagging other countries. In Q1 2018, Orange Belgium reported average use at 1.6GB per month, rising to 2.4GB for its smartphone users. Proximus reported an average use of 1.6GB per month, going up to 1.8GB for its 4G customer base. Smartphone penetration at Orange and Proximus was at 74 percent in Q1 2018.
Although the smartphone penetration is still behind neighbouring countries such as the Netherlands (90% in Q1 2018 for 12-80 year olds), the average data usage is more in line. In Q1 2018, VodafoneZiggo reported an average monthly usage of 2.3GB for its postpaid smartphone user base, while KPN reported 2.4GB in Q4 2017 for its consumer retail postpaid base. Telecompaper’s Consumer Insight Panel shows that over 40 percent of Dutch mobile users had a data bundle of more than 1.5 GB and 13 percent had more than 10 GB (including unlimited bundles) in Q1 2018.
There are still countries with higher average usage, such as France. According to French regulator Arcep, France’s average usage is 3.4GB per month, rising to 5.8GB for 4G users. However, other Western European countries show little difference with Belgium. For example, Agcom in Italy reported average use per smartphone at 2.8 GB in Q3 2017. Bitkom in Germany estimated an average use of around 2GB per smartphone user in 2017, with smartphone penetration around 80 percent.
Can a fourth operator be a success?
Given the above data, the question is whether there is enough room for market growth to attract a fourth operator to invest in Belgium. In the Netherlands, the launch of a fourth operator, Tele2, has had mixed results. After launching its own network in 2015, Tele2 is already looking to merge with T-Mobile, after struggling to turn a profit. However, the introduction of a fourth operator did increase competition. One of the results was T-Mobile starting to offer unlimited plans for a much lower monthly price. This in turn led to price reductions by other providers in the past year. Tele2 was forced to respond with its own unlimited plan at an even lower price than T-Mobile, making it difficult to turn its mobile service profitable and recover the costs of building its network.
Our data show that in terms of prices and data usage, Belgium is already largely in line with the average in Western Europe. Although this doesn’t mean that average data usage or smartphone penetration should not increase more, it does show that any new operator would face similar difficulties to Tele2 in the Netherlands: high costs to build a network, while having to charge low prices in order to compete and win market share, making it difficult to balance the books.
*The EU Benchmark report is based on Telecompaper’s calculation of Total Cost of Ownership (TCO), taking into account all monthly subscription or connection costs and promotional discounts and adjusted for differences in purchasing power across the 16 countries.
