“Unlimited.” That word sounds pretty good, right? Unlimited vacation. Unlimited salary. Who could say no to unlimited?
How about unlimited mobile data? Subscribers definitely like the sound of that, and operators know it.
As a result, we’re seeing the word “unlimited” return to operator service offerings. In Finland, DNA offers unlimited 4G internet. In the U.S., T-Mobile’s new ONE plan offers unlimited everything – text, voice, data, streaming video and music, even in-flight Wi-Fi. In Germany, Deutsche Telekom lets you buy 24 hours of unlimited data.
Of course, we know conditions apply. Here’s a few ways operators limit “unlimited”:
- Video resolution – T-Mobile and Sprint offer unlimited streaming of 480p video, but customers can opt to pay more for higher quality.
- Tethering – You have to pay extra for truly unlimited tethering on T-Mobile, otherwise you get 0.5 megabits per second.
- Time – Verizon lets you buy unlimited 4G LTE data in 30- or 60-minute options. DNA uses Comptel’s FWD solution to allow time-based internet access for prepaid customers.
- Speed – DNA, Elisa and Swisscom all offer options to increase data speeds on higher cost plans.
Regardless, we see operators opening their minds to unlimited data, primarily for four reasons:
- The ARPU Lift – Mobile customers are ready to pay a bit more for peace of mind.
- Simplified Services – Data buckets confuse customers. “Unlimited” is easier to understand and, consequently, buy.
- Competition – Incumbent players offer zero-rated bundles to appeal to buyers – like AT&T and DirecTV’s mobile and TV bundles. Unlimited plans help other operators mitigate the impact of zero-rated content.
- Reduced Wi-Fi Offload – When they’re restricted, customers don’t want to use data, so they’ll seek third-party Wi-Fi instead. Unlimited data could change that behaviour.
This has meant the demise of the data bucket, but an increase in data utilsation, even when “unlimited” is actually, well, limited.
Where Unlimited is Working
In South Korea, Olleh, SK Telekom and LG Uplus introduced “unlimited” plans in spring 2014 (speeds are typically throttled to 3-5 Mbit/s after customers reach their threshold). In the time since, monthly 4G data utilisation has surged.
Finland is the ultimate example of the power of unlimited. The country far outpaces any other for data utilisation, topping 7 gigabytes per SIM card per month in the first half of 2016. The closest runner up was South Korea at nearly half that amount. The secret to Finland’s success? Nearly half of all SIM cards in the country benefit from unlimited data volume.
But is the Data Bucket Really Dead?
Of course, there are exceptions. Here are a few operators still innovating in the per-GB model:
- Rollover – Verizon, T-Mobile, Olleh and Virgin Mobile offer monthly data rollover options.
- Sharing – Tele2, Telenet and AT&T let you share a data bucket across several SIM cards.
- Gifting – Orange, Globe Telecom, and KPN let customers gift unused data to other users.
- Zero-Rating – T-Mobile and Proximus allow free or reduced data for use in entertainment apps.
- Sponsored – Verizon, AT&T and Smart Telecom make use of sponsored data programs, where the cost of data access is paid for by a third party.
- Partnering – Telia uses partnerships with the likes of HBO and Spotify to offer scaled data plans.
- Bonusing – Vodafone and YouSee offer extra data for customers who also buy fixed broadband.
- Rewarding – Japan’s au offers extra data as a perk for long-term customers who stay on.
The bottom line? Operators increasingly understand data’s value to customers – it’s practically currency. Unlimited can drive higher data utilisation. Creative per-GB monetising can provide rewards or savings.
Mobile data is the single most useful monetisation asset in telco today. Use it wisely.