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Wireless

T-Mobile NL and Google Fi show how to differentiate unlimited mobile data

Friday 19 January 2018 | 10:25 CET | Market Commentary
The launch of unlimited data in the mobile market appears to have left operators with few tools left to control prices. The telecom sector's growth has been based on delivering ever better speeds to support improved services and higher prices, but this disappears once unlimited data is offered. Nevertheless, providers such as T-Mobile Netherlands and Google Fi show that there is some room for manouevre when it comes to unlimited data. 

To start, unlimited data risks a race to the bottom. Still, there is a business model in the concept, with elements such as: 

  • Differentiation. If the market leaders are not offering unlimited data, a challenger can embrace the concept to win market share. Of course, the market leaders may respond at some point, by lowering prices or increasing volumes. 
  • Cost reductions. Marketing and sales are expensive. Unlimited is a simple service and can also help make many other services unnecessary. 
  • Competing on the fixed market. Data caps for fixed broadband have disappeared in most countries. A broadband wireless access service will only be successful if the data costs are manageable. T-Mobile NL shows this is possible with its new fixed-line replacement, albeit with a capacity limit of 25 Mbps.

There are still new things to try with unlimited data.

  • We discussed earlier the Vodafone Pass concept, which offers unlimited data for specific services, such as social media or video streaming, for a fixed amount per month. Several operators are trying this, such as Russian MVNO Yota.
  • The above is a 'smart' (i.e. paid) variant on zero-rated data. The latter is used by companies such as T-Mobile NL (Datavrije Muziek) or Telekom Deutscgland (StreamOn), although this has attracted some net neutrality concerns. 
  • Turkcell is developing an all-IP strategy with its Lifecell brand, focused on mobile data. Customers can get zero-rated data for music and video. In Belgium, Scarlet (Proximus sub-brand) is offering a data-only subscription, for customers who only use IP services. 
  • Google Fi, the MVNO run by Google in the US, introduced a prepaid element in its mobile data tariffs. At the end of the month, the customer only pays for what he/she used, with anything else refunded. At the same time, the monthly spend on data services is capped at USD 60 (plus USD 20 for unlimited calls and SMS. This is essentially unlimited data for a variable and maximum amount. 


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