Optical/IP Networks

Mobile Data Packaging: A Policy-Driven Revolution?

It may be not be that obvious in the developed markets of the U.S. and Europe, but a revolution is in the air in mobile data packaging and pricing – and for the most part, it's happening in non-Western and emerging markets.

In a long list of new pricing ideas I've been compiling in connection with Heavy Reading's research on policy management, here are just a few that provide some idea of the rich vein of ideas that is being mined:

  • Movistar Colombia has created five mobile data packages, including one that offers only email, one just for IM, one for social networks – all at low price points.

  • Saudi Telecom Co. (STC) has built a "prayer time" offer, enabling subscribers to block access to the Internet, or to specific IP-based applications (video, chat, voice, gaming, etc.) during prayer times.

  • Poland's Play increased bandwidth, removed volume limits and removed restrictions on P2P traffic between midnight and 9 a.m.

  • Russia's MegaFon offers unlimited access to some URLs, event-based charging and varying speeds based on protocol and usage profile.

  • In Kuwait, Zain Group offers two contrasting prepaid data packages -- one for customers on limited budgets with a low connection speed, and one for those who are mainly looking for occasional high-speed access.

  • In Sweden, 3 Group offers a variety of on-the-fly promotions, including QoS uplift for loyalty and periodic free boosts in data speed.

  • Multiple operators now offer unlimited access to Facebook and other social networking sites within volume-delimited services.

  • Multiple operators waive data volume metering in off-peak periods, e.g. at night.

  • Some operators offer "shared wallet" services, in which allocations are shared across different devices or family members, for example.

  • One operator lets customers choose five Internet sites or URLs and get unlimited access to them.

What's driving this innovation? In the first place, many of these markets are very competitive, forcing operators to find new ways to differentiate their services. Low disposable income is a second factor, leading to the creation of a wider range of packages to suit every pocket. And a third factor is probably light regulation – in particular, operators in many markets don't have to worry that regulators will impose net-neutrality rules that get in the way of price innovation.

Finally, of course, pricing schemes can help meet traffic management goals. Data volume limits are now the near-universal rule for mobile broadband services, but innovations like those above help to refine the way that congestion is handled.

This innovation is increasingly (though not exclusively) underpinned by policy control. And because policy control is such a flexible technology, there is likely to be much more to come. Many operators are saying they plan to implement more ideas in the future, including RAN or cell-level congestion controls, location-based charging and two-sided pricing models that also charge content or applications providers. The ultimate goal: user-based control via sophisticated dashboards or portals.

None of this means that flat-rate pricing is going away. It is a proven, successful model in both fixed and mobile networks, and many users will continue to prefer it because it is simple and predictable. In fact, a great deal of future innovation may happen inside the flat-rate envelope, rather than via meter-based charging. Alternatively, clever policy controls may be applied much more extensively to stretch bandwidth, but will largely be invisible to users and won't be presented as explicit options they can choose.

Nor is it a technical slam dunk. As new pricing schemes and packages underpinned by policy control grow more complex, so the demands on the policy architecture multiply, creating some major challenges. Connecting policy to billing and charging is far from straightforward; indeed, there is no direct link between the 3rd Generation Partnership Project (3GPP) Policy Server (PCRF) and the online or offline charging systems – something that is being addressed in the new 3GPP release, with the new Sy interface. Other issues include the ever-increasing number of policy-controlled transactions and sessions, and the scattered sources of information and intelligence that must be gathered and addressed to make those decisions – increasingly in real time – to realize the new packages.

But if these technical challenges can be met, life may be about to become a lot more interesting for telco marketeers, who will no longer be able to complain that they don't have the means to innovate. It will raise new issues about what kinds of packages consumers will accept. But if the hectic changes now taking place in some markets are any guide, we can expect a lot more innovation in the next year or two, as mobile broadband and smartphone continue to spread inexorably.

— Graham Finnie, Chief Analyst, Heavy Reading

njust_wmh 12/5/2012 | 5:07:38 PM
re: Mobile Data Packaging: A Policy-Driven Revolution?

some deep insight in this artical,  like it

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