& cplSiteName &

Europe Needs Mobile Mavericks

Michelle Donegan
Wireless Bits
Michelle Donegan
1/10/2013
50%
50%

10:00 AM -- Consumers pay far more to use data on their smartphones in European countries that don't have an independent competitive mobile network operator, according to new research from Helsinki, Finland-based consultancy Rewheel. While it's no secret that lack of competition in any particular market results in higher prices for users, this study shows that significant price declines are driven by the operators that Rewheel refers to as "independent challengers." As the Financial Times noted in this article, those challengers are known as "mavericks" by industry regulators. These maverick operators are not part of any incumbent national operator or a subsidiary of one of Europe's five largest mobile operator groups (dubbed, the E5 group) -- that is, Deutsche Telekom AG, France Telecom - Orange, Telecom Italia SpA, Telefonica SA and Vodafone Group plc . Rewheel finds that even when an operator from the E5 group is in a challenger position as the third or fourth biggest network in a market, it does not drive price competition. The best examples of European challengers are 3 in the U.K., Free Mobile in France or Tele2 AB in the Netherlands, now that it has an LTE license. Rewheel shows just how much these operators drive down prices: the lowest available smartphone tariffs in markets without a challenger operator is 140 percent higher than in markets that have at least one maverick mobile operator. (For the study, Rewheel compared the lowest smartphone tariffs in each market for a minimum of 2GB of data and 200 off-net minutes per month.) Also, markets that have an independent challenger have on average 34 percent higher mobile data penetration. The Rewheel study shows how these competitors are needed to make smartphone usage more affordable and pervasive across the EU. The big operators clearly haven't done it on their own. There are such challengers in 14 of Europe's 27 markets, according to Rewheel's study, which didn’t specify the country names. So, where are the upstarts that will take on the rest of Europe's mobile data scene? Perhaps the painful economic situation in Europe is enough to keep would-be investors away for now. But that makes it more important than ever for Europe's regulators to set the conditions that will attract investment from new, independent operators. The upcoming 4G auctions in the region will be good opportunities for regulators to encourage new entrants, like Ofcom in the U.K. has done by designing its auction to ensure that there are at least four 4G mobile network operators. We're hoping regulators will get it right and the rollout of 4G networks will also launch a new breed of mobile operator challengers. — Michelle Donegan, European Editor, Light Reading Mobile

(7)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
pal.zarandy
50%
50%
pal.zarandy,
User Rank: Light Beer
1/11/2013 | 6:23:22 PM
re: Europe Needs Mobile Mavericks
If instead of being fixated on protecting their existing voice and sms centric business models and revenue streams they would start focusing on squeezing down variable, data traffic related capex and opex - as for example operators in "mobile data progressive", truly competitive markets like in Finland do - they could-áaccommodate-áfar more traffic without hurting their margins. Of course, if the regulatory climate allows them to protect their margins without this extra "stress", why would they bother.

http://uk.reuters.com/article/...
Gabriel Brown
50%
50%
Gabriel Brown,
User Rank: Light Sabre
1/11/2013 | 2:19:21 PM
re: Europe Needs Mobile Mavericks
On the other hand if there's insufficient profit, where's the incentive to build better networks? The industry needs a decent level of profit to innovate.

A lot of the cost reduction we've seen as consumers over the past few years (especially in the UK, for example) is the result of development started/done when the industry had cash to invest.

The danger of a race to bottom is-áthat we'll have cheap services, but not very good ones.
pal.zarandy
50%
50%
pal.zarandy,
User Rank: Light Beer
1/11/2013 | 11:35:48 AM
re: Europe Needs Mobile Mavericks
Mostly bad.

Mobile network operators need to feel a burning pressure to keep innovating and increasing mobile network capacities and spectrum efficiency, ultimately their own competitive cost level advantage of "producing" - or rather delivering a GByte on their network.-áEven if they are confronted by the realities of flat or even declining market revenues, and maybe even that they themselves will not be able to grow any more their revenues.

If local regulators, competition commission, allows spectrum pooling and extensive active network infrastructure sharing, there will be not much incentive for the MNOs to push down cost per Gbyte. Especially not in light of the threat of voice and SMS cannibalisation. Why would they bother swapping their network gears for more modern, higher capacity, much cheaper platforms and negotiating better pricing deals with their infra vendors if at the end of the day their competitors are using the same cost level and everybody is more or less happy with their 50, 30, 20% market shares and existing margins?

Would the breathtaking speed of innovation, growth of processor power, memory, screen size have happened in smartphones, if the device market was a closed market with hard barriers of entry like in the case of service providers, if the few incumbents like Nokia, RIM, etc would have been "allowed" to start sharing the development of their hardware and software platforms? Definitely not.
Michelle Donegan
50%
50%
Michelle Donegan,
User Rank: Light Beer
1/11/2013 | 11:21:35 AM
re: Europe Needs Mobile Mavericks
Given the report's findings, you also have to wonder about how network sharing and spectrum pooling will affect consumers -- will these trends be good or bad for consumers?
Michelle Donegan
50%
50%
Michelle Donegan,
User Rank: Light Beer
1/10/2013 | 7:42:09 PM
re: Europe Needs Mobile Mavericks
Most countries weren't called out for their smartphone pricing, but the top four priciest markets were the Czech Republic, Greece, Hungary and Germany, based on Rewheel's data, which was collected in December 2012. -áAnyone surprised?-á
Michelle Donegan
50%
50%
Michelle Donegan,
User Rank: Light Beer
1/10/2013 | 7:37:34 PM
re: Europe Needs Mobile Mavericks
The 27 EU countries are diverse by any comparison. But Rewheel found that the tariffs for the smartphone plans it compared (that is, at least 2GByte data and 200 off-net minutes per month) ranged from 8 euros to 78 euros. That's a massive gap and it's bound to raise eyebrows in Brussels.
More Blogs from Wireless Bits
Undercuts Huawei and ZTE in China Mobile 4G tender
CTO says vendor is seeking insight and inspiration from developer competitions
After a few months away, Sarah Reedy is back on the Light Reading team
Four new focus areas for NGMN Alliance highlight the key challenges facing mobile network operators in 2013
9:00 AM Smartphones have bigger mobile data appetites than tablets in Europe
From The Founder
Cisco's Conrad Clemson, recently promoted to head up the company's Service Provider Apps & Platforms developments, talks to Light Reading's Founder and CEO Steve Saunders about how he's bringing cloud video, mobile and virtualization together to empower network operators.
Flash Poll
Live Streaming Video
Charting the CSP's Future
Six different communications service providers join to debate their visions of the future CSP, following a landmark presentation from AT&T on its massive virtualization efforts and a look back on where the telecom industry has been and where it's going from two industry veterans.
LRTV Custom TV
Introducing OrbTV: Netscout's MWC Day 1 Recap

2|27|17   |   8:35   |   (0) comments


The executive team of Netscout reviews the first day of Mobile World Congress in Barcelona. Stay tuned for OrbTV -- Light Reading and Netscout's full coverage of the show. We'll have daily show recaps, service provider interviews and tours of the show floor.
LRTV Custom TV
Innovation at MWC: Low-Power IoT for Scottish Sea Lions

2|27|17   |   6:32   |   (0) comments


Light Reading's Liz Coyne tours the GSMA's Innovation City at Mobile World Congress 2017. A key theme of this year's event is how low-power or no-power IoT devices could become a part of our everyday lives. Imagine a world in which over 15 billion shipping pallets communicate with cellular networks down the entire supply chain. Or a parka that reveals your ...
LRTV Huawei Video Resource Center
Huawei Will Accelerate the Spread of the Video Business

2|27|17   |     |   (0) comments


What is the future of the booming video business? What changes will happen to the video industry chain in the future? Hunter Hu, VP of Huawei Video Product Line, shares his viewpoints and explains how Huawei can be an enabler and accelerate the spread of the video business.
LRTV Huawei Video Resource Center
Frost & Sullivan's Jonas Zelba on Going Beyond Connectivity

2|27|17   |     |   (0) comments


Telecom operators across the globe are trying to understand what can they offer beyond connectivity. Operators are already introducing new and innovative services but they are faced with challenges due to unclear business models. Jonas highlights that no one operator can offer all the services itself. Operators in the Middle East should look within their ecosystem ...
LRTV Huawei Video Resource Center
IDC's Paul Black on Cloudification

2|27|17   |     |   (0) comments


Paul Black from IDC shares his insights on how cloudification is expected to combile all aspects of digital transformation.
LRTV Huawei Video Resource Center
Industry Expert Michael Howard Talks About Cloud Native

2|27|17   |     |   (0) comments


Cloud Native is a really nice term and a lot of people are using it. But most of them have their own definition of what Cloud Native means. Michael Howard offers his take on the terminology.
LRTV Custom TV
4.5G Evolution: Peter Zhou on Advanced MIMO Technologies & 5G Business Prep

2|25|17   |     |   (0) comments


In the process of service transformation, operators need to catch three major opportunities and start deploying in 4.5G networks, such as video, household broadband access and digital transformation of vertical industries. 5G is coming. Operators don't need to wait for it to happen but should progressively deploy 4.5G networks by introducing 5G-oriented ...
LRTV Custom TV
What WTTX Can Deliver

2|23|17   |     |   (0) comments


Mohamed Madkour explains the benefits of WTTX while Dimitris Mavrakis discusses the challenges of delivering home broadband access.
LRTV Custom TV
Huawei on Mobile Broadband

2|23|17   |     |   (0) comments


Mohamed Madkour shares his vision on MBB for the next three years.
LRTV Custom TV
Analysys Mason Talks About the Future of Digital Operations

2|23|17   |     |   (0) comments


The future of digital operations has three key aspects: 1. Highly automated operations for both service and network; 2. Highly converged BSS/OSS for business and resources; 3. Highly merged management and control for real-time cloud native operations.
LRTV Interviews
Software Trends in the Telecom Sector

2|23|17   |   03:40   |   (0) comments


Heavy Reading senior analyst James Crawshaw talks with Telecoms.com Editorial Director Scott Bicheno about trends and developments in the telecoms software sector and what to expect at MWC 2017.
LRTV Custom TV
Huawei's Pre-MWC Analyst Briefing 2017 Highlights

2|22|17   |     |   (0) comments


Huawei shares its vision for this year's MWC.
Upcoming Live Events
March 21-22, 2017, The Curtis Hotel, Denver, CO
March 22, 2017, The Curtis Hotel, Denver, CO
March 22, 2017, The Curtis Hotel, Denver, CO
May 15-17, 2017, Austin Convention Center, Austin, TX
May 15, 2017, Austin Convention Center - Austin, TX
June 6, 2017, The Joule Hotel, Dallas, TX
All Upcoming Live Events
Infographics
With the mobile ecosystem becoming increasingly vulnerable to security threats, AdaptiveMobile has laid out some of the key considerations for the wireless community.
Hot Topics
Uber's HR Nightmare: Company Investigates Sexual Harassment Claims
Sarah Thomas, Director, Women in Comms, 2/21/2017
Broadband Has a Problem on the Pole
Mari Silbey, Senior Editor, Cable/Video, 2/21/2017
Verizon to Start Fixed 5G Customer Trials in April
Dan Jones, Mobile Editor, 2/22/2017
Cloud Rains on HPE Earnings
Mitch Wagner, Editor, Enterprise Cloud, 2/24/2017
Like Us on Facebook
Twitter Feed
BETWEEN THE CEOs - Executive Interviews
Light Reading founder and CEO Steve Saunders chats with Sportlogiq CEO Craig Buntin about sports data analysis.
Eyal Waldman, CEO of Mellanox Technologies, speaks to Steve Saunders, CEO of Light Reading, for an exclusive interview about the 100 GB cable challenge, cybersecurity and much more.
Animals with Phones
No One Likes This Click Here
Take a hint!
Live Digital Audio

Playing it safe can only get you so far. Sometimes the biggest bets have the biggest payouts, and that is true in your career as well. For this radio show, Caroline Chan, general manager of the 5G Infrastructure Division of the Network Platform Group at Intel, will share her own personal story of how she successfully took big bets to build a successful career, as well as offer advice on how you can do the same. We’ll cover everything from how to overcome fear and manage risk, how to be prepared for where technology is going in the future and how to structure your career in a way to ensure you keep progressing. Chan, a seasoned telecom veteran and effective risk taker herself, will also leave plenty of time to answer all your questions live on the air.