Service Platforms > Teligen Tariff & Benchmarking

The changing pricing model for mobile content

by Josie Sephton | 11月 24, 2011

Since the introduction of mobile data plans, pricing has been largely based on the amount of data used, with little regard to content. However, anecdotal evidence from the market increasingly points to the emergence of a potentially very disruptive mobile pricing model - namely the bundling of data access and content.

Mobile providers have toyed with content in their pricing models in the past - some more so than others. For example, back in 2009, Three in the UK offered two years' free access to Spotify Premium (which allows on-demand streaming of music to mobile phones) with the network?s first Android phone, the HTC Hero, based on a £35/month tariff (and £99 for the phone). This 'free' model was designed to kick-start streaming habits, and to generate interest in Spotify, rather than provide a sustainable template for future offers. Access to Spotify Premium today tends to be offered as a trial for a limited time period within a contract - typically between two and six months -before reverting to a regular monthly subscription. This is true of other similar services that are available today in other countries. Rdio, offered through Telus in Canada is one such example, where the content service is a distinct add-on to the service.

Not all operators are separating out content from the bundle. In Denmark, TDC has bundled in access to its streamed music service, TDC Play, into its mobile offerings, effectively 'hiding' the cost of subscription, with plans ranging from 129 DKr to 499 DKr per month including TDC play. This approach has proved successful, with TDC managing to attract a relatively high proportion of customers to the Play bundles.

Orange is probably one of the most active operators in terms of pursuing a content-focussed strategy. It is already well known for its various content-style offers in the UK market, including the free weekly iTunes movie download service that it launched in August of this year. However, it stepped up a gear in September of this year, when it launched its 'Swapables' offerings. Swapables works on the basis that subscribers to top-tier plans will be given access to a range of content options, including Deezer Mobile, which provides mobile access to Deezer's on-demand unlimited premium music service, Mobile TV (selected channels), Sky Sports Mobile TV, 247 Sports (sports alert service), The Times and Sunday Times newspapers, and MTV video clips, among others. Under Orange's 'Panther' packages, which start at £35 per month, subscribers can sign up for 2 services, and can also change their service choice from month to month. What is notable with Swapables is that, for now at least, the cost of the Panther packages have not changed. This means that the content offered under Swapables will not generate additional subscriber revenue for Orange. Rather this will come in the form of data add-ons and additional content purchases. And Orange will no doubt try to migrate users up towards the Panther packages

Orange hasn't just been active in the UK, when it comes to content bundling, of course. Orange France has also been very active in this area. As a major pay TV (to the home) provider in France, it has been bundling in access to its pay TV services, VoD/Movies on Demand services for a while, with its 'Orange Cinema' and 'Origami Star' packages. It also has had tremendous success bundling in streaming music into several data plans, through its partnership with Deezer. Just five months on from signing the agreement for the Deezer Premium + service, which is distributed through Orange's internet and mobile networks, the service had attracted more than 500,000 subscribers.

One area which is seeing a lot of interest from mobile operators is that of Facebook. Access to the social network is increasingly bundled into offerings from mobile offerings, with access to Facebook often being zero rated (i.e. not counting against the data allowance).

We are likely to see more content-based offerings emerging in the mobile arena going forward, and there will be doubtless a lot of testing around which pricing approach is most successful - one which allows users to choose their content add-ons, or one which offers a simpler but potentially more expensive flat-rate approach. There are pros and cons with each of course, and the probability is that both will prevail. Additionally, we are likely to see more experimentation around access to content that doesn't count against monthly usage allowances. One thing is clear with this fast changing picture - in the world of mobile data, the issue of how content is handled within the overall delivery mechanism will be a key strategic focus for mobile providers.

Previous Post: France - Bouygues refreshes postpaid range | Next Post: France - Orange refreshes top-up benefits

Let's talk

Now you know a little about us, get in touch and tell us what your business problem is.
Name:
Email:
Telephone:
Country:
Inquiry / Message:

please enter captcha from left