Mobile operators using bundling to differentiate offers

UK: By contrast, LTE 4G services are being provided for all customers and are a limited differentiator. Service bundling is the main differentiator being used to attract and retain customers according research in the latest edition of the TCL Tariff Trends SnapShot subscription service.

Tariff Consultancy Ltd (TCL) in the latest version of its TCL Tariff Trends SnapShot subscription service (SnapShot 40 – Pricing for QoS and Bundling) analyses how MNOs are differentiating their premium services. With the first launch of LTE 4G services MNOs offered high-speed service access as only a premium service. But since launch, LTE 4G services have been introduced as a standard product across all mobile data services in most established 4G markets.

There have been some exceptions. TCL SnapShot 40 finds that only a few selected MNOs (including Swisscom (Switzerland), Vodafone (Germany) & Elisa (Finland)) are pricing their LTE 4G Smartphone packages of calls, SMS & Mobile Data according to access speed.

Elisa, in particular, is providing distinct pricing for 2G access, 3G access, 4G access & 4G Super access – with speeds ranging from up to 0.25 Mbps up to 150 Mbps – but with unlimited SMS, calls & Mobile Data services.

But the majority of MNOs in the established markets of Europe and North America are offering LTE 4G services with the same access speed across all customer segments. Instead of pricing according to access speed, most MNOs are increasingly differentiating their pricing with the use of additional bundles, including content, mobile insurance, international calls, international roaming and shared data, voice & SMS (including additional SIM cards).

The number of different bundling options is increasing due in part to MNOs seeking to protect a premium price point and also to provide further differentiation on top of the traditional bundle of calls, messaging and mobile data.

Mobile operators are seeking to add more bundled options to in order to maintain an existing price point – as in the Danish market, with Telia Denmark (including shared data, additional SIMs, insurance & TV content) - or to differentiate their bundles from a competitor at a lower price point – as in the French market, with Orange (including IDD calls and roaming to specific destinations).

Some MNOs (including Vodafone Qatar) are offering extra optional bundles (selected by the user) from a list of services providing the user selects a certain plan. Tele2 (Sweden), provides a free HBO Nordics TV subscription to users who purchase a 3 GB mobile data plan or above.