European WLAN access remains highest priced

LONDON -- Pricing in Europe for public access wireless local area networks (WLANs) remains the highest in the world, according to a new report issued by consulting firm BroadGroup. The report also forecasts that growth in hotspot deployment will increase across Europe by some 45% by the end of this year, across the companies surveyed.

The report, Public Access Wireless LANs: Pricing and Trends, has assessed and interpreted marketing strategies and pricing schemes across Europe, North America and Asia Pacific, covering 87 players in 23 countries.

"Pricing is broadly falling into classic time bands," said Philip Low, managing consultant at BroadGroup. “Although service providers would prefer to sell monthly subscriptions, more are now making available weekly, 24-hour and 1-hour prepaid schemes.”

The report found that some players are differentiating by offering blocs of 2-hours and 4-hours or other categories, and offering bundled products with GPRS. But European prices tend to be generally higher, and widely spread, whereas the US appears to have a more cohesive price range and is highly competitive.

'Europe not competitive'

“The European market is not yet fully competitive for these types of services,” Low said, “but this will change by early in 2004 as customer awareness of the benefits of wireless LANs diffuses, and roaming capabilities play a greater part in their choice of provider.”

Since the last study conducted by BroadGroup in February of this year, the report finds that schedules planned for network deployment have not yet been fully realised. The Iraq war, SARS in Asia and elsewhere, a slow down in business travel, and the consequent effect on hotels, airlines, airports and other locations associated with Wi-Fi have collectively impacted overall deployment, according to BroadGroup. However, Europe is catching up, and this survey suggests that the region will experience the highest growth rate globally, in terms of deployment over the next six months.

By 2004 however, the report suggests that a number of factors will begin to influence the pace and change of deployment and pricing, including the impact of new roaming and billing platform structure players, which may also possibly begin to displace the role of aggregators, especially in Europe.

TDC Denmark (0.05) followed by Broadreach UK (0.07) and Swisscom Eurospot (0.07) offered the cheapest per minute rates in Europe. 

The cheapest rate found globally is in Asia (0.03) and offered by ChungHwa Telecom Co Ltd, and in the US by T Mobile (0.05) for 1-hour usage

Mobile Data Pricing

Earlier this month, BroadGroup announced the launch of the new Mobile Data Pricing service, dedicated to tracking and analysing mobile data pricing and marketing. Published every two weeks, BroadGroup says it is the first service dedicated to providing regular and reliable information, tracking price changes and marketing strategies for mobile data services in Europe and central and eastern Europe, and will be expanding gradually to cover other regions globally. Service coverage will include GPRS, WAP, i-Mode, UMTS/3G, SMS and all forms of MMS.

"Data pricing is increasingly complex,” Low said, “and our customers have expressed a need for a service to explain data pricing structures, and keep track of how they change. Mobile Data Pricing is the preferred solution for service providers, and all companies involved in this growing market segment."

As the migration of customers to a wireless always-on data world continues to be realised, BroadGroup's position is that service providers will progressively need to confront how to align data growth and pricing, with per MByte transport costs, an increasingly important point of competitive differentiation.

However, data pricing is more complex than other forms of tariffing, and to gain insight into price structures, important changes and marketing innovation, there is a need for regular information tracking and analysis.

Each edition will include samples of pricing offered by service providers, note key changes that have occurred in pricing, and provide information on marketing innovation used in promoting data services.