10 Creative Ways Telcos Can Price Mobile Data Plans in 2014

Posted: June 2nd, 2014 | Author: Malla Poikela | Filed under: Industry Insights | Tags: , , | 1 Comment »

There’s a lot happening in developed telecommunications markets when it comes to monetisation – communications service providers (CSPs) are no longer charging customers per minute, they’re charging per megabyte. Talk and text are usually unlimited, while data has become limited.

The business of charging customers for data can be complex. Many major mobile operators offer capped data packages, but in certain cases, this may impact customer experience. Consumers understand that their phones use data, but it’s not always clear how that data is consumed. Does Facebook use more data than WhatsApp? How many songs on Pandora can be played before the cap gets hit? How many YouTube videos can be watched?

The data usage of different apps and services can be confusing. When customers hit a data cap without expecting it, their experience may suffer if there isn’t an easy, flexible and affordable way to top up for the rest of the month. Otherwise, customers will use WiFi instead of mobile when they’ve reached their monthly data allowance.

Future revenue growth will depend on flexible, personalised service packages, and how fast CSPs are able to launch them to the market. Through a combination of tried-and-tested monetisation methods – and new ones – CSPs will be able to build a better customer experience while introducing new sources of revenue.

Comptel recently worked with tefficient to create a whitepaper that highlights 10 more methods mobile operators should consider implementing to monetise data. Here’s a preview of three methods that are covered in the whitepaper:

1. Ad-funded mobile

Last year, an ad-funded MVNO called Wifog launched in Sweden with a unique proposition: users could consume as much data as they wanted, but they had to be open to advertising and data collection. For every 100Mb of data used, a Wifog subscriber watches a 45-second video ad. Wifog gained 120,000 users in five months.

Established CSPs may not want to replicate this exact model, but it’s possible for them to host these kinds of ad-funded mobile virtual network operators (MVNOs). In that regard, this could be a way to generate revenue from advertisers while hosting customers that traditionally use Wi-Fi or Over-the-Top (OTT) services.

Analytics could come into play here, too – CSPs could monitor user habits and customise the customer experience, targeting them with the most relevant ads.

2. App time-based charging

With the right approach to policy and charging, CSPs could potentially create a service plan that monetises how often customers use an app, with pricing plans based on hourly, daily, weekly or monthly rates.

In mature markets, this data plan could solve the “end-of-the-month” problem, when customers have run out of their data allowance and don’t want to pay for another whole-month package if they only have a few days left. Consequently, there are a lot of customers who would like to pay for a bundle at a lower price point.

If CSPs can leverage analytics to see which kinds of apps these customers use, a more affordable, Facebook-only package could be more effective for the last few days of the month. The harmony of policy, charging and analytics play an essential role here – the agility and flexibility offered by the right solution can help monitor app usage to guarantee that customised, time-based packages are delivered when a data cap is hit.

Indian operator Uninor shifted from a Mbyte-based offering to time-based app pricing – for example, users can now pay one rupee for a day of unlimited access to WhatsApp or Facebook.

3. Apps for flat fees

CSPs can also offer a set of apps for a flat fee. Japan’s second largest mobile operator, KDDI, offers this model with a “Smart Pass” package, which allows members to get unlimited access to a set of apps for a flat fee. In addition, members are given a few other benefits, such as discounts and photo storage services. “Smart Pass” launched in 2012, and in March 2014, 10 million customers were on the plan.

The really exciting part about offering apps for a flat fee is the potential for predictive analytics. By monitoring how customers use apps and what apps are used, CSPs will be able to personalise offers and predict which apps are going to be used across their networks, creating custom packages for different audience segments.

Possibilities, Analytics, Case Studies

In this blog entry, we only covered three ways CSPs can monetise mobile data, but our white paper has ten. In the future, a diversity of offerings – and the policy management product that allows for responsive and flexible delivery and pricing – will be key.

All subscribers have different habits when it comes to using their mobile phones.  With the help of policy charging and predictive analytics, CSPs can create personalised service packages that are delivered at exactly the right time.

Want to learn all of the ways CSPs can monetise mobile data? Download “10 more methods to monetise mobile data,” written by consulting firm tefficient, an international efficiency specialist for telecom operators and suppliers.

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