Are mobile challengers taking a more sophisticated approach?

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I was interested to read a report from Analysys Mason on the changing nature of so-called disruptive mobile operators, which often started out as brash upstarts with cheap and cheerful prices but over time have morphed into players with a little more gravitas.

In Europe, such players include Free Mobile in France and Three UK. Three has broadly focused on low-cost, high-usage mobile data plans, adopting a colourful and aggressive marketing strategy that has included straplines such as ‘when stuff sucks, #makeitright’.

Free, meanwhile, laid waste to France’s mobile industry in a few short months, briefly reducing the three incumbent operators to quivering wrecks before they were able to muster sufficient strength to retaliate.

According to the Analysys Mason report, its analysis shows that disruptive mobile operators have been living up to their reputation: they do offer lower prices per GB for all data allowance sizes.

“Their premiums for unlimited or very large data plans are minimal, often leading to prices far below those of competitors’ more-modest data plans. The plans compared are not identical in terms of bundled services and features (other than mobile data), but they still indicate the price ranges at which operators expect to attract customers toward various data allowances,” the analyst company said.

Analysys Mason also argues that such disruptive players should also no longer be dismissed "as no-frills players that keep their prices lower than their competitors by only providing data. In most cases, they also either match or beat their competitors in terms of other service elements.”

I would agree on that to a certain extent: both Free Mobile and Three have focused heavily on inclusive roaming and international calls within their mobile plans, for example. Three UK has also demonstrated some innovation, such as the Three inTouch app for Wi-Fi calling services and the 4G Super-Voice voice-over-LTE service.

Yet in France, for example, Free does offer a considerably less sophisticated proposition compared to rivals, which provide data multi-SIM cards to enable data to be shared among devices; free inclusive content; and a generally broader range of tariffs. Free does offer discounts on mobile plans to subscribers of its Freebox home internet plans, but Three is very much a mobile-only player.

Analysys Mason concludes by saying that while analysing mobile-only offers may not provide a complete picture of markets in which fixed–mobile convergence is increasing, “it still provides an indication of the competitive intensity generated by disruptive mobile-only players, and the resulting changes to both consumer expectations and the definition of a ‘premium’ mobile operator.”--Anne