As a follow on from yesterday’s blog about the increase in broadband uptake in New Zealand, here’s a story from the Philippines that shows what could happen if telcos suddenly stop throttling demand for a service with high prices.
The Philippines’ second largest telco Globe Telecom reports its mobile network was overwhelmed by a surge in new subscribers after the company lowered the price for its mobile broadband modem.
The company more than halved the price of its Globe Broadband Tattoo stick from 1,895 Philippine pesos (NZ$85) to just 895 pesos (NZ$25), resulting in a massive boost in subscriber take-up, causing the network to be crippled, according to The Manila Times.
Last year, Globe had 148,769 mobile broadband users, which rose to 379,309 in the first half of this year.
Of course TUANZ would not want any of our carriers to suffer network failures due to this kind of overloading, but this example shows how offering end-users a better deal can greatly boost demand for a service.
Globe also introduced new Tattoo mobile data plans that start from 499 Pesos (NZ$14) a month which includes 45 hours of mobile internet usage, as well as 10 hours of internet at wifi hotspots. Its package for heavy users costs 1,499 pesos (NZ$43) a month and includes 160 hours of mobile broadband and unlimited wifi usage.
It also offers a casual time-based browsing package at 5 pesos (14 cents) for 15 minutes and a per kilobyte rate of P0.15/kb (less than half a Kiwi cent).
In comparison Telecom XT’s mobile broadband plans start at $49.95 a month. For this you get a 2GB data allowance. And currently you’ll get a free data stick on a new two-year contract.
Vodafone offers 1GB for $49.95 a month on a two-year contract with a current bonus offer of up to $200 off a mobile broadband device.
2degrees’ data plans meanwhile… Oh, wait – let’s check back on those later…
It is hard to compare the local plans with those offered by Globe since the plans are measured differently.
However, there seems to be no data limit on Globe’s plan, so according to my research using an online mobile broadband usage calculator, if a user uploads or downloads five good quality photos, downloads 10 music tracks, watches two hours of streaming video and downloads one full-length movie, plus sends around 200 emails, in a week, they will get through around 4.5Gb of data in a month.
Assuming they can get all of this done in the 160 hours Globe’s high-user plan allows, this deal looks quite good compared to the New Zealand offerings.
The robustness of my calculations aside, there is certainly some room for improvement in New Zealand.
I particularly like Globe’s converged broadband offering – that gives users access to the mobile broadband network, as well as public wifi access.
This would be a great solution for the growing number of mobile workers who are increasingly sporting wifi-enabled mobile handsets, such as the iPhone and newer Nokia and Blackberry models.
We are yet to see New Zealand operators offer any kind of combined fixed and mobile plans, even though both Telecom and Vodafone also offer fixed broadband, while Telecom runs a network of wifi hotspots.
In addition, a number of other ISPs, such as Callplus/Slingshot, Compass, Orcon and TelstraClear, now also offer mobile services, albeit as virtual operators.
Wouldn’t it be great to pay a single monthly fee for your broadband connection no matter where you use it – in the office, on the road or at the local café?
* Thanks to the NBR’s Chris Keall for the headline idea (via Field of Dreams): Break it, and they will come: broadband subscribers top 1 million