Report: Global LTE pricing to fall 60% in five years

A new report from Tariff Consultancy (TCL) indicates global LTE mobile broadband pricing will decline by as much as 60 percent during the five-year period between 2012 and 2016.

The study finds that LTE is currently being promoted as a premium mobile broadband product based on a high theoretical download access speed. However, the firm anticipates that LTE mobile broadband pricing will decline as more operators worldwide adopt the technology.

As of the end of 2011 about 60 percent of commercial LTE services have been launched so far in Europe. Into 2012 more LTE networks will be launched in other regions including the Asia Pacific and South America with LTE pricing set to become more competitive as LTE becomes a mass market service and enters other consumer segments using increased download access speeds as a key differentiator.

By the end of 2016 TCL forecasts more than 250 million users of LTE mobile broadband services, and average pricing per subscriber will decrease to around $26 per month--a decrease equivalent to more than 60 percent in LTE pricing over the five-year period.

"Although it is clear that LTE subscribers and revenues will grow substantially over the next year years, LTE mobile broadband services will start to adopt the same mass market characteristics of the existing fixed broadband and 3G mobile broadband services with increased speeds but price competition," said Margrit Sessions, managing director of TCL in a release. "The onus will be on the operators to bundle other services into their LTE offer and develop more compelling user-based applications and content services as well as simply providing large LTE Mobile Broadband access capacity."

TCL said it already sees evidence of price erosion among LTE mobile broadband providers. Telstra in Australia, for instance, currently offers its BigPond USB 4G mobile broadband product with an 8 GB monthly data user allowance for the equivalent of $39 per month, against $49 for a 4 GB monthly data user allowance reported at the time of launch. Singapore M1 (Mobile One) is offering its next generation mobile network equivalent LTE service to existing M1 customers with a 40-percent discount off the monthly list price.

For more:
- see this release

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