The Telecommunications Regulatory Authority (TRA) in Bahrain has recently released the 2012 update of the retail price benchmarking study into telecoms services in Arab countries. The study, conducted by the Teligen division of Strategy Analytics, was commissioned by TRA on behalf of AREGNET (the Arab Regulators Network).

Similar to previous years, the report provides a comprehensive analysis of the cost of telecoms services for different types of user, and considers the cost of fixed and mobile voice, fixed and mobile broadband and leased lines across a number of Arab countries, as well as providing a comparison with average OECD (Organisation of Economic Co-operation and Development) pricing. Development of prices in each of the Arab countries covered since 2008 is also included.

The study revealed that over 2011-2012, prices in the Arab countries have generally come down, however, as prices in other parts of the world had fallen as well, the gap between prices in Arab countries and prices in OECD countries remains.

In addition to the general report, TRA has also released a report which looks more in-depth at the results for Bahrain across the various services, in relation to the other GCC (Gulf Cooperation Council) countries overall as well as to the OECD averages.

Full results from both reports, along with detailed information on the methodology used, are available for download free of charge on TRA's website.

UK regulator, Ofcom, has recently released the 2012 update of the International Communications Market Report, which compares the availability, take-up and use of services in the UK and a number of comparator countries (France, Germany, Italy, Spain and the USA).

As in previous years, the report covers a number of areas, including:

• an analysis of the UK market in context
• comparative international pricing, comparing the typical prices people for a range of different 'baskets' of communications services
• a review of both the television and audio visual market and the radio and audio market
• an assessment of internet use, in terms of platforms and devices, as well as content and consumption
• comparative international data on the communications sector, comparing the UK to a range of comparator countries in order to assess how the UK is performing in an international context.

The comparative international pricing element of the report, which is based on data and systems supplied by the Teligen division of Strategy Analytics, compares five 'baskets' of services - fixed voice, mobile voice, fixed broadband, mobile broadband and pay TV - representative of the communications use of five typical households. The analysis shows that the UK remains very price competitive, offering the lowest price for all five baskets when a weighted average of single service pricing was taken into account and for four of the five baskets when looking at 'best-offer' or lowest possible pricing.

The low mobile prices in the UK are a key factor in the UK positioning (although, fixed voice and fixed and mobile broadband prices in the UK are also comparatively low), however, the study found evidence that UK communications prices were increasing in nominal terms, and that this was mainly down to increasing mobile prices. In the year to July 2012, the weighted average cost of more than half of mobile connections in the UK increased by between 5% and 31% (in nominal terms).

HD premium pay-TV services were the main area where the UK did not perform well - partly due to the fact that Sky bundles a large number of channels in its premium pay-TV package, as well as charging its satellite TV customers an additional £10 a month to let them access premium channels in HD.

In the analysis the results for France were also favourable, with France having the lowest 'best-offer' including multi-play price for the 'connected family' household[1]. Notably, for this household, France was significantly cheaper than in the UK as a result of the availability of a low-cost quad-play bundle of fixed voice, fixed broadband, mobile and pay-TV services. France also had the second lowest 'weighted average' prices for all five households.

Notably, consumers in most of the six countries analysed were able to make cost saving of between 5% to 40% by buying bundled packages rather than purchasing services individually.

The full study results, along with detailed information on the methodology used, are available for download on Ofcom's website.

[1] A connected family is defined as a family of four with generally high use of several communications technologies. A definition of a connected family can be found in the main report from Ofcom.

Strategy Analytics' Pricing and Benchmarking systems, offered through its Teligen division, have been supporting operators and regulators around the world for more than 30 years, helping them monitor and evaluate pricing strategies for fixed and mobile voice and data services.

Once again, Strategy Analytics will be holding two exclusive breakfast presentations at MWC 2013 which will provide insights into smart devices and smart experiences in a multi-screen world, as well as adjacent market opportunities and new business models for service providers. During the briefings, we are pleased to be able to offer attendees the opportunity to see a live demonstration of both our OECD Mobile Price Benchmarking Service and OECD Mobile Broadband Price Benchmarking Service.

The demonstration will allow you to see the powerful analytical abilities contained within our systems, which have helped our many customers answer critical questions such as:

• What are the prices and price structures of our competitors' services, and how do we compare?
• Which tariffs favour different kinds of usage?
• Where do we rank against comparable markets?
• What is the cost effect for end users when usage escalates?

Demonstrations of a number of other exciting Strategy Analytics' services - the Handset Country Share Tracker, ConsumerMetrix survey database, as well as PriceTRAX and SpecTRAX - will also be available.

If you would like to register for this breakfast event click HERE-->>

Based on findings from the most recent update of Teligen's OECD Fixed Broadband Price Benchmarking service, which considers more than 120 ISPs in 40 countries around the world, residential users can expect to pay on average, between USD PPP 27 and USD PPP 68 per month for broadband and related services. The cost will vary based on the speed of service and whether users opt for standalone broadband or a bundle of services with some combination of broadband, phone and television. Note that these costs only include basic levels of phone and television service that will be included in a multiplay bundle, and do not take into account cost associated with service add-ons, in the form of premium television channels, or additional call bundles, which will attract additional charges over the basic service offerings.

The two tables below show the average monthly cost in US dollars (PPP) for residential broadband services - both standalone and multiplay - across 40 European and OECD countries, and the incremental cost of various multiplay combinations over standalone broadband.

Table 1: Average monthly cost in USD PPP for residential broadband services, December 2012

Source: OECD Fixed Broadband Price Benchmarking, December 2012 update

Table 1: Incremental cost of phone and television service over standalone broadband, December 2012

Source: OECD Fixed Broadband Price Benchmarking, December 2012 update

The incremental cost for phone service ranges from just under 8 USD PPP per month, to over 14 USD PPP per month, while the incremental cost for TV is just over 8 USD PPP per month to almost 17 USD PPP per month. As the speed of service increases and with broadband services more likely to be fibre-based, the incremental cost of TV decreases. By contrast, increases in broadband speed results in an incrementally more expensive phone service. Users taking all three services (broadband, phone and TV) on average pay an extra 21 USD PPP month, irrespective of speed.

A more detailed analysis of broadband price development is available in the recently published insight, 'Broadband prices driven by increasing speeds', which is available for free download.

Broadband services offerings have moved into a period of consolidation, with gradual rather than dramatic changes to both pricing and service features.

Based on an analysis current and past updates of Teligen's Fixed Broadband Price Benchmarking Service, we have observed relatively small shifts in the areas of price, download speeds and service bundling, with the majority of activity happening at the higher service end, e.g. higher speeds of standard and bundled services.

Pricing for lower speed services have remained relatively static, while higher speed (30 Mb/s and above) standalone and bundled services have fallen by 3.5% on average over the last quarter. This less dynamic shift compared to services such as mobile, for example, is in line with what we would expect - subscribers to fixed broadband services, especially when they include add-on services such as phone and television, are unlikely to change provider on a frequent or regular basis, due to the nature of the service. Providers recognise this, and have reflected this in their approach to pricing.

Rollout of higher-speed services, too, is a gradual process - average advertised download speeds have increased by less the 1.5 Mb/s since March 2012, and one which is more evident when looking at changes over the course of a year, or even longer.

Going forwards, we expect to see a continuation of current trends, with gradual, rather than dramatic shifts in both pricing and service features.

A more detailed analysis of these developments is available for free download.

As both LTE deployment and upgrades to HSPA/HSPA+ technologies gather pace around the world, average advertised maximum download speeds for mobile broadband are growing. As of March 2012, based on almost 3,000 plans from 113 operators across 33 countries in Strategy Analytics' Mobile Broadband Price Benchmarking Service, average maximum speeds reached in excess of 14 Mbps, a rise of over 13% since December 2011, while over 730 plans - almost a quarter of the total - have maximum advertised download speeds of 21 Mbps and above. It is debatable how many users actually achieve these speeds, of course, and mobile broadband is unlikely to be a substitute for fixed broadband any time soon, in most markets at least. Given this steady rise, however, it is increasingly a viable complement to fixed services. This uplift in speed has been accompanied by an 8% increase in average allowances, which reached 8.3 GB by Q1 2012.

As we would expect, postpaid plans are typically cheaper than prepaid - for some usage levels, up to a third cheaper. Naturally, the balance here is the ongoing commitment required by postpaid plans.

A more detailed analysis of how mobile broadband charges are evolving is available for free download.

T-Mobile has introduced two new tariffs to its postpaid customers. Both plans give unlimited calls. At CZK 2000, T-Moble Grand offers CZK 1000 credit plus unlimited calls to T-Mobile and fixed lines. Grand Plus is charged at CZK 3990 per month and allows users to make unlimited calls to any network in the Czech Republic. Messaging is not included in the tariff so is still charged at individual prices.

T-Mobile continues to offer its previous pay monthly plans such as Friends, Top and Credit.

In addition, the operator has unveiled a prepay plan with an emphasis on data. Twist Internet requires a monthly fee of CZK 850, for which users receive a credit of CZ K50 for calls and text messages as well as 5GB of data per month. This tariff offers a price of CZK 7.90 per minute for calls to fixed lines and other operators. Calls to T-Mobile are cheaper and two time bands apply, with off-peak on-net calls costing CZK 3.40 per minute.

Full details of the plans above are available in T-Cellular Online. Teligen monitors price developments of this sort in its continuous updates of T-Cellular Online http://sa-link.cc/3i

The broadband pricing lot of the rural customer in the UK is not always a happy one, with many often paying significantly more for broadband service than users in towns and cities (BT customers excepted). Pricing isn't the only issue; with general quality and speed of service often cited as comparatively poor. Moreover, Ofcom, the UK communications regulatory body, does not have any power to force these two-tier pricing ISPs to reduce their prices.

Ofcom's recent announcement, however, which states that BT must reduce wholesale prices by 12% below inflation per annum, from mid-August onwards, in areas where it is the only wholesale provider of broadband, will no doubt be welcome news to rural dwellers. The reduction should lead to greater competition among retail ISPs, which in turn will mean lower retail prices for consumers. Ofcom believes that the benefit of the caps will not just be restricted to retail pricing; improvements in service quality may also follow, as ISPs will be able to allocate more bandwidth per customer, and as a result, deliver faster broadband services.

How quickly consumers in rural areas will see the effects of the caps remains to be seen - Ofcom is anticipating that ISPs will start reducing retail prices by the end of the year. It certainly seems to be a step in the right direction

If you're interested in developments in broadband pricing, this is something that Teligen tracks closely though its broadband benchmarking service, T-Connect.

The move by mobile providers to end all you can eat packages has gained dramatic momentum over the past few months Already, many of the 74 providers covered under Teligen's mobile broadband price tracking service, T-Wireless have introduced caps on previously unlimited use offerings.While this wasn't a particularly pleasant pill for many users to swallow, it wasn't entirely unexpected. The dramatic growth in data going over mobile networks, and the impact this was having on service quality meant that something had to give, or at least that if it didn't, users could expect to pay accordingly.

It has been a different story for fixed broadband. While providers in some countries will cap usage: the UK and Ireland for example, are two countries where many providers set usage allowances - it tends to be much less common practice in other countries.

The recent announcement by AT&T that it is introducing data caps and overage fees for residential broadband users just maybe hints that change is blowing in the broadband wind. From the beginning of May, customers using landline DSL will be subject to a usage limit of 150 GB per month, while users of its bundled internet/phone/TV service, U-Verse will get a 250 GB allowance. An overage cost of $10 per 50 GB over and above these limits has been set.

These upper limits are certainly not ungenerous for consumers, and are at the upper end of many of the caps in place across the various providers that Teligen tracks. And the majority of customers are unlikely to be impacted by these caps, according to AT&T, which claims that, for example, an average DSL customer only uses around 18 GB a month, and that only 2% of subscribers will be affected by the introduction of the upper limit. Even with consumers' desire for more and more bandwidth, there is still enough slack in these caps to allow for a significant increase over current usage for many - providing, of course, that these caps do not shrink over time. Furthermore, in a move that many mobile broadband providers would do well to take note of, the provider has committed to keep customers informed of their usage, notifying them when they hit 65%, 90% and 100% of their monthly allowance, as well as providing an online tool to allow customer to check usage whenever they want. The knock on effect of this is that users will have a much greater appreciation of how much data they actually use, which is no bad thing, as many simply do not have a handle on this at the moment.

As and when these caps come into force, users will doubtless complain - much as they did with mobile broadband caps. Some will worry about overage charges, while others will bemoan the fact that the caps are set so high that they are paying for bandwidth they simply won't use (which is kind of ironic, if they have come from a world where they were paying for unlimited usage). From a provider perspective, it is very much a case of damned if you do, damned if you don't. The 'trick' for them is to strike the right balance between fairness - if you use, you pay - and simplicity/transparency, by not creating too many layers around broadband pricing. We only need to look at mobile voice pricing to see that offering too many packages isn-t a particularly good idea, as discussed in a recent post.

We can probably expect to see providers follow AT&T's lead in fixed broadband pricing. But before the critics start on the inevitable tirade against them, it is worth remembering that genuine flat rate pricing across comms services is not as prevalent as we would all like to believe - a closer look at service terms and conditions will reveal that.

T-Mobile Austria has introduced the a new plan Hit Germany, the plan is aimed at users who contact Germany frequently and is also available as a SIM only.

* Denotes roaming minutes.

Orange Austria also offers a very similar plan with more roaming minutes included but fewer SMS included.

Mobile operators are increasingly offering reduced international rates as an option or as an integral part of a tariff, as shown in the table above. As in the case of these tariffs, they can be based on international traffic between two closely linked countries such as Germany and Austria, or else based on the user's ethnicity. Similarly, many operators in Germany offer packages for reduced calls and texts to Turkey and French operators have similar offers to users originating from Northern Africa.

These tariffs have been extracted directly from our T-Cellular Online Service (TCO).

Teligen monitors price developments of this sort in its monthly updates of T-Cellular Online http://www.strategyanalytics.com/default.aspx?mod=navigationheader&a0=1530&a1=0