Welcome to the overcharged continent
via Flickr © Franck BLAIS (CC BY-SA 2.0)
One of the great things about a ‘fragmented’ mobile communications scene - such as we currently enjoy in Europe - is that it lays bare the differences in pricing and performance between companies and countries and in so doing indicates strongly which regulatory environment(s) are best.
The best shows users in less well-regulated environments what could be; and the worst serve as a dire warning to those more fortunate.
Finnish consultancy Rewheel has just put out its third Digital Fuel Monitor which tracks mobile internet access prices across Europe along with other competitive metrics such as data consumption, adoption and speeds across EU28 and OECD countries.
There’s some big numbers: this time DFMonitor includes 1,638 smartphone and data-only tariff plans offered in 41 countries from 137 operators and 71 MVNOs.
Teasing all this data into shape shows that there’s over 100 times difference in gigabyte pricing between EU countries, says Rewheel - in the most expensive a gigabyte of data is 100 times more expensive than in the cheapest. What’s more, that gap is growing.
“While the gigabytes that €35 can buy stayed flat at around 2 in the German, Italian, Spanish, Belgian, Austrian and Portuguese protected markets, in the Nordics and Baltics they doubled every year and reached 19 gigabytes in the first half of 2015,” points out Antonios Drossos, Rewheel managing partner
The pricing matters, maintains Rewheel, because access bandwidth is the “digital fuel” which sets the health level of the broader digital economy in each country. So in a country where the ‘protected’ (from proper competition) telcos are ratcheting up prices, they’re not only damaging the financial interests of their users, they’re throwing out a boat anchor to slow the entire digital economy.
As proof, mobile data consumption per capita in Finland was ten times higher than in Germany in 2012 and by 2014 that factor grew to thirteen, the study found. “The average mobile data consumption per capita (excluding WiFi) in Finland reached a whopping 5.4 gigabytes per month in 2014. That is 13 times higher than the German 2014 consumption of 0.4 gigabytes per capita. Meanwhile Finnish networks continue to be ranking among the fastest in the world and operators are making very healthy profits.”, said Drossos.
What appears to be making the disparities worse is some operators’ determination to push up pricing to make zero-rating an attractive option. There is then a tendency for zero-rating to be used to favour operators’ own cloud and movie-streaming services, a mechanism that many believe is blatantly non-neutral. .
“Some telcos are so eager to lure consumers from the open internet to their own vertically integrated walled-gardens that they even give a free zero-rate ride to adult content. The porn industry will be delighted on the news”, said Drossos.