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Pricing Strategy Key to HSDPA Uptake

Latest research from Informa Telecoms & Media shows that HSDPA networks are expected to be switched on in all major Western European markets before the end of 2006 and with a range of smartphone devices coming on stream, uptake of HSDPA will now heavily depend on pricing strategies implemented by mobile operators.

"Looking to the fixed world, broadband uptake only truly took off after the introduction of flat-rate tariffs and the settling of average monthly fees at a level of around 25 Euros," says Devine Kofiloto, Principal Analyst at Informa Telecoms & Media. "Mobile operators have to date resisted moving to flat-rate models but if mobile operators really aspire to the data traffic volumes of the fixed world, they must also recognise the factors that have so successfully underpinned growth for fixed broadband providers," he says.

Informa's analysis of early HSDPA pricing strategies shows signs that mobile operators are aware that existing pricing models have stifled data uptake. Although there still seems to be resistance to embracing true flat-rate models, upper volume limits have been increased significantly and a consensus on a 'fair use' limit appears to have settled between 1GB and 2GB.

Increasing the size of 'fair use' limits must go hand in hand with prices that are attractive to potential users. According to Informa's analysis, the average price for operators' largest HSDPA data bundles is somewhere between 50 and 70 Euros per month.

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