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Vodafone Launches (Expensive) GPRS Euro Roaming

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LR Mobile News Analysis
Light Reading
3/26/2002

Vodafone PLC says that, in April, it will be first operator to offer its subscribers the ability to roam over GPRS (general packet radio service) networks in 12 European countries. However, the high ticket price that Vodafone, and other operators, charge for wireless data downloads on the new networks is likely to dampen widespread enthusiasm for such services.

GPRS was supposed to be the key to unlocking the wireless data puzzle. The packet-based technology, it was said by many, would allow operators to charge users for the amount of data they downloaded rather than for the length of the call. However, carriers are currently pricing all but well-heeled corporate users out of the market with their prices for downloads over GPRS networks.

For instance, a Vodafone U.K. GPRS subscriber will be charged about £5 to £6 (US$7 to $8) per Mbyte of data they download. A Vodafone spokesperson said that this could still be cheaper than using existing GSM technology to download a large document. However, comparing the old network to the new is hardly the point -- GPRS was expected to really drive wireless data usage in Europe, removing the speed and cost constraints of the existing technology and enabling people to download everything from Word documents to video clips on their phones, rather than the 160-character SMS (short messaging system) text messages that are currently the mainstay of European data traffic. Current pricing plans are unlikely to encourage such carefree usage.

Vodafone says that a British subscriber using the new pan-European roaming service will pay around £8 ($11.41) for each Mbyte downloaded over networks in other countries. “I don’t like it, but I’ll pay it,” admits Andy Buss, an analyst at research firm Canalys.com Ltd., who counts himself as one the “early adopters” that he reckons Vodafone is trying to court with the roaming service.

Buss uses the GPRS service in the U.K. and finds it “reasonably quick,” achieving download speeds equivalent to those of a 28.8k landline modem. He downloads documents to his personal digital organizer (PDA) over a Bluetooth wireless link with an Ericsson AB T68 phone and says that he still watches the megabytes, as the cost can add up.

However, Buss says that there is a definite need for flat-rate download plans before GPRS services really take off, even for business users. These would involve the user -- or, more likely, the user’s employer -- paying £40 or £50 a month for 50 MBytes worth of downloads. Variations on these kinds of plans have proved popular with everyday business users in the past: For instance, Research In Motion Ltd. has had a massive hit in North America offering corporate users unlimited email downloads on its BlackBerry pagers for $40 per month.

GPRS phones are also still too expensive for the average consumer. The Ericsson T68 has dropped in price and is now around £100 ($140) with a service plan. However, an awful lot of phones in Europe are given away free with the service plan. Clearly the handset situation will change over time. Nokia Corp. (NYSE: NOK) is likely to start the charge with a slew of new GPRS phones out later this year, Buss says.

Vodafone is initially offering the roaming services to customers who will be able to access Vodafone services over GPRS in a number of destinations when traveling in Europe -- including Belgium, France, Germany, Greece, Ireland, Italy, The Netherlands, Portugal, Spain, Sweden, Switzerland, and the U.K.

“It’s a bit of a paper launch really,” says Buss, noting that the roaming capabilities will not be available in one of the largest markets, Germany, till the end of April. The service currently tends to favor U.K.-based subscribers, hardly surprising, given Vodafone hails from Newbury, England. “They haven’t got the whole network fleshed out yet,” says Buss. For instance, as it stands, a Vodafone U.K. user can roam on both the Swisscom AG network in Switzerland and the Europolitan Vodafone network in Sweden, but a Swisscom subscriber can only roam on the Vodafone U.K. network and not its Swedish equivalent. Buss expects more two-way roaming capabilities to be added over the course of the year.

— Dan Jones, Senior Editor, Unstrung
http://www.unstrung.com

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