Whenever you read a story about telcos and data plans, keep this graph in mind
We posted this graph back in July, but it’s worth repeating from time to time: according to tech consultant Chetan Sharma’s US Mobile Market Q1 2014 report, where he pointed out that as of late last year, more than half of the “Big Four” mobile carriers’ ARPU (average revenue per user) comes from data:
Click the graph to see it at full size.
As mobile devices become more powerful and take on new forms (first phones, then tablets, now watches and “smart bands”), and as they find their way into more aspects of our work and home lives, their usage — and in turn, mobile data usage and spending — will continue to increase. If you’re in the business of managing mobile expenses like we are, knowing what drives the carriers’ behaviors and offerings is key to finding efficiencies and savings opportunities.
AT&T and Verizon’s “more data for less money” offerings
Forbes recently posted an article looking at AT&T and Verizon’s current “more data for less money” offers, where they looked at both telcos’ offerings and compiled them into a single table, which we’ve adapted below:
| AT&T | Verizon | |||
|---|---|---|---|---|
| Monthly fee | Old | New | Old | New |
| $40 | 2GB | 3GB | 1GB | 1GB |
| $70 | 4GB | 6GB | 4GB | 4GB |
| $80 | 6GB | 6GB * | 6GB | 10GB |
| $100 | n/a | n/a | 10GB | 15GB |
| $130 | 15GB | 30GB | 16GB | 30GB |
| $150 | 20GB | 20GB | 40GB | |
* AT&T has a 6GB plan at this price, but it may be discontinued.
Data from Forbes. Click here to see the source.
Some notable bits of info from the article:
- AT&T are aiming at the low end of the market, offering a better deals at the $40 price point.
- Verizon’s deals are more enticing once you approach paying $80 or more a month. If you’re considering AT&T’s $70/month plan, you may want to consider paying an additional $10/month and get an extra 4GB of data.
- Verizon is offering a $150 credit to people who move their mobile number over to them, taking a page from T-Mobile’s playbook. Forbes reports that this is increased competitiveness rather than a response to customer loss.
- Will this sort of pricing, which will increase data usage, make service worse? The article suggests that the real culprit in Verizon’s service degradation in the San Francisco Bay Area is HD Voice, which allows for markedly improved call quality on select flagship phones, such as the Galaxy S5 and iPhone 6 series.
- And most importantly: Will these offers go away? Yes, but keep these in mind:
- If you sign up for any of these plans, you’ll be “grandfathered” and be able to keep it for as long as you like.
- Given the market’s currently competitive state, more offers like these are likely to come in the near future. Expect carrier plan deals after the holidays, when customers will be looking for the best plans for their shiny new mobile presents.
“Refuse to unlock my device for international travel? Goodbye forever.”
Ars Technica’s Lee Hutchinson was a happy and loyal customer of his carrier until he tried to unlock his device so he could use a local prepaid SIM card while visiting Germany for a week. That’s when it all went downhill, and he shares his story in this article.
Profiles of Sprint’s and T-Mobile’s CEOs
The Kansas City Star reports that newly-minted Sprint CEO Marcelo Claure will present his first quarterly report today, the 2Q 2014 report, after the markets close. His first three months — he took over from former CEO Dan Hesse in August after their failed attempt to buy T-Mobile — have seen the carrier change strategies, lay off employees, and cut prices.
Bidness Etc. aren’t very optimistic about the report: while Sprint will likely show an increase in the metrics for current subscribers, there probably won’t be an increase in the number of subscribers, and between price cuts and the cost of network upgrades, ARPU (average revenue per user) is likely to take a hit.
And finally, because a lot of people can’t get enough of him, here’s Sci-Tech Today’s profile of T-Mobile CEO John Legere. He’s loud, he’s audacious, and in a mere two years changed both the company and its public perception dramatically, as well as the way the other carriers have had to do business in response.
