Analysys Mason: Truly unlimited mobile data plans are a rarity in Western Europe

Caesar Bachelet

According to our research (published in our recent Viewpoint) in 10 major Western European mobile markets just over one in five operators (22 per cent) offer at least one truly unlimited mobile data plan, either for handset data or mobile broadband, to target heavy mobile data users. The markets include Austria, Belgium, Denmark, France, Germany, Norway, Portugal, Spain, Switzerland and the UK. Most heavy users have to settle for capped or throttled unlimited services, which were the most generous plans on offer from two-thirds of the operators covered in our research.

Capped or throttled unlimited mobile data plans can bring operators and consumers the best of both worlds

This research analysed the correlation between mobile data subscription pricing and mobile operator key performance indicators (KPIs) such as subscriber and revenue growth. We allocated the 36 operators within our 10 Western European countries to the following categories, according to the business models used.

  • Truly unlimited: Operators that offer consumers at least one handset data and/or mobile broadband tariff with unlimited data consumption at maximum available speeds within the monthly subscription fee.
  • Capped or throttled unlimited: Operators without any truly unlimited mobile data plans, which feature at least one tariff offering unlimited data, albeit at reduced speeds once a specified usage limit has been reached, within the subscription.
  • Openly advertised data allowance: Operators that only offer tariffs with a specified amount of data included within the subscription.

The overall results of our classification, covering both handset data and mobile broadband data plans, are highlighted in Figure 1.

Figure 1: Operator business models for mobile data subscriptions, February 2013 [Source: Analysys Mason, 2013]








From a heavy data user's perspective, truly unlimited plans are the most attractive because they offer "all you can eat" access to mobile data at maximum speeds for a set monthly price, provided the price is perceived as reasonable. Some operators, such as Hutchison Whampoa's 3UK, have gained market share by offering truly unlimited handset data. For example, 3's "Ultimate Internet" and "One" plans bundle voice, texts and data, starting from £13 (15.37) per month for a two-year contract, including an entry-level smartphone. However, most operators are wary of offering such plans, because it leaves them unable to rein in exceptionally high levels of usage by some customers, which would take up a lot of capacity on the cellular network, potentially to the detriment of other subscribers.

At the other end of the scale, one in 10 operators only offer services with an openly advertised data allowance. These services clearly link monetisation to usage as far as the operator is concerned, but they can potentially lead to bill shock and confusion for consumers, of which many have yet to fully understand how the MB or GB allocation in their data allowance translates into something meaningful. Nevertheless, these plans give the operator the opportunity to offer services at a wide range of price points to target the different needs and budgets of their subscribers.

Capped or throttled unlimited data services are the most commonly used business model, because they represent a sensible compromise between the other two.

  • Such plans still offer consumers the benefit of unlimited data for a set fee, albeit at reduced speeds once a particular threshold has been reached. However, consumers still have the option of paying a supplement if they would like more higher-speed data for a better user experience.
  • This business model enables operators to better manage data consumption once various thresholds have been reached, thus protecting the network from the excesses made possible by truly unlimited data plans. However, operators need to be transparent with consumers about the thresholds, making it clear that these services are not truly unlimited, in order to avoid being potentially perceived as deceitful.

However, the choice of business model for handset data and mobile broadband services varies, because of the differing nature of the services. For more in-depth analysis linking pricing to KPIs as well as examples of successful operator strategies, please see our recently published Viewpoint The impact of mobile data pricing on operator KPIs.

Cesar has over 20 years' experience of the telecoms industry, and specialises in triple-play services, with a focus on pay TV, as well as emerging services and devices within the digital home. Before joining Analysys Mason, Cesar worked for telecoms operator BT, where he held a range of positions, including those of Competitor Analyst in the Consumer Division and Market Analyst in BT Ignite's application service provision unit (now BT Global Services), for 14 years.