Report: Mobile challengers needed to drive down data prices in EU

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The key role that "maverick" operators such as Hutchison Whampoa's 3 and France's Free Mobile play in driving down the price of mobile services has been brought into sharp focus by a new report, which argues that consumers in markets without these "independent challengers" pay far more for their mobile data services.

Reports from the Financial Times and Light Reading cite new research from Finland-based consultancy Rewheel, which illustrates that these maverick operators drive significant price declines. Markets dominated by one of the one of Europe's five largest mobile operator group-- Deutsche Telekom, France Telecom, Telecom Italia, Telefónica and Vodafone--tend to have higher prices even when one of the big 5 acts in the challenger role as the third or fourth operator.

Indeed, the FT notes that mobile users pay up to 10 times more to use smartphones in European Union countries that lack an independent challenger. There are such challengers in 14 of Europe's 27 markets, according to Rewheel's study.

A separate report in French daily Les Echos provides a notable illustration of the impact such challengers can have. Citing comments from French telecoms regulator Arcep, the newspaper said average monthly payments per SIM have fallen by 13.7 percent to €21.6 since the arrival of Free Mobile a year ago. Iliad-owned Free turned the French mobile market on its head with a competitive, all-inclusive plan that provides unlimited voice, texting and up to 3 GB of data for €19.99 a month.

For its part, 3's strategy has focused on providing a strong data challenge; markets such as the UK have benefited from 3's "all you can eat" data plans, while the operator has adopted similar strategies in other markets such as Ireland.

Citing the Rewheel study, the FT noted that European consumers can pay anywhere between €8 and €78 a month to use their smartphones, using a base package of a 2 GB data allowance and 200 off-network minutes.

The Rewheel report comes at an opportune time following recent reports that Europe's leading operators are seeking ways of improving competition between the fragmented national markets in Europe.

For more:
- see this Rewheel release
- see this Light Reading article
- see this FT article (sub. req.)
- see this Les Echos article (translated via Google Translate)

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