KPN abandons handset-leasing experiment

KPN said it has abandoned its handset-leasing model because of an underwhelming response from subscribers, who told the operator they wanted to own their mobile handsets at the end of their contract terms.

As part of a general overhaul of its mobile tariffs starting July 1, the Dutch operator said its new "All-in-one Mobile" plans with unlimited calls and texts and a data bundle, including LTE data, will also now include the cost of a handset.

"We decided to renew the mobile subscriptions of KPN Mobile, because our mobile KPN customers told us they prefer more clarity upfront, regarding costs as well as ownership of the handset," Jesper Eriksen, director of consumer at KPN, said in a statement. "Consequently, handset leasing for KPN Mobile propositions will no longer be available."

A spokesman for KPN told FierceWireless:Europe that handset subsidies, which he stressed had not been abandoned by the operator when the leasing model was introduced, will remain at the same level as before. The spokesperson added that the leasing scheme will be retained for the time being under the Hi and Telfort brands of KPN.

KPN's efforts to seek alternatives to expensive subsidies for high-end smartphones reflects a growing trend in the mobile industry, although operators often find that moving away from subsidies can be painful. This was particularly highlighted in Spain, when both Vodafone Spain and Telefónica's Movistar lost subscribers after abandoning subsidies. Vodafone Spain has since reinstated subsidies for consumers.

According to a recent report from Informa Telecoms & Media, since 2008 nearly 30 European operators have introduced handset-financing programs as an alternative to the subsidy-led model of selling handsets bundled with service contracts.

For more:
- see this release
- see this Telecompaper article (sub. req.)
- see this report

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