4G LTE Tariffs in Europe: key trends in Q1 2017

Point Topic tracks changes in the 4G LTE tariffs provided by mobile operators across Europe

This overview presents the latest 4G LTE tariff benchmarks as of 31 March 2017

We have compared the average monthly subscription charges and download speeds offered by mobile broadband providers across the EU-28, Norway and Switzerland. All prices are quoted in US dollars at PPP (purchasing power parity) rates to allow for easier comparison.

Note: from this quarter, we only include monthly 4G LTE tariffs that offer at least 1GB data allowance. We also assigned 600GB data cap to ‘unlimited’ data tariffs to be able to include them in our calculations.

1.1 Overall 4G LTE tariff trends

In Q1 2017, the average monthly charge for residential 4G LTE services varied from $60 in Malta to $25 in Belgium.

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Figure 1. Average residential 4G LTE monthly tariff in PPP$, Q1 2017

In some cases, the lower average monthly charge reflects the lower average usage allowance, and vice versa (Figure 2). However, countries such as Switzerland and Denmark stand out as being at the high end of data allowances and the low end of monthly charges, in other words providing the best value for money to subscribers. This is reflected in the average cost per GB of data in these countries being among the lowest in Europe (Figure 3). At the same time, 4G subscribers in Germany, Spain, Slovakia for example are paying high monthly charges for minimal data caps.

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Figure 2. Average monthly data allowance, residential 4G LTE tariffs, Q1 2017

It could be argued that 4G LTE subscribers in Denmark as well as Estonia, Latvia, Austria and especially Finland are offered monthly data volumes comparable to those used by an average subscriber of a fixed broadband package.

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Figure 3. Average cost per GB of data in PPP$, Q1 2017

Another aspect which complicates comparing mobile broadband services between countries and against fixed broadband services is the fact that some mobile operators do not report data speeds with their specific 4G LTE tariffs. Even when they do, the variability between the theoretical maximum bandwidths and the actual ones is much higher in the case of mobile broadband as opposed to fixed broadband. The actual attainable speeds on 4G LTE networks also vary much more depending on location, even within the same area of town.

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Figure 4. Average theoretical downstream speed on residential 4G LTE services, Q1 2017

Nevertheless, Figure 4 shows which countries are investing in higher speed and more advanced 4G networks, including those using the LTE-Advanced technology. It should be noted that Denmark is a special case in this context. The average download speed of 71Mbps refers to the maximum speed that the Danish operators are allowed to market after agreement with the consumer ombudsman. In fact,  in Q1 2017 TDC’s  theoretical maximum speed was 412Mbps, and 900Mbps around Tivoli in Copenhagen.

1.2 Regional and country benchmarks

There will be exceptions at a country level but when comparing the economies of Eastern and Western Europe in a more generalised fashion, Western Europe comes out on top both in terms of the average data allowance and average monthly tariff on 4G LTE networks.

Among the strongest Western economies, there is a stark contrast between, for example, Sweden and The Netherlands and the other selected five countries when it comes to average 4G data volumes offered to residential customers (Figure 5).

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Figure 5. Tariff benchmarks for residential 4G LTE services in six major European economies, Q1 2017

To compare what price on average a residential customer would pay for unlimited monthly 4G LTE data in various European markets, we selected the countries which offered such 4G LTE tariffs. We excluded the tariffs which come with a tablet as the monthly device cost would distort the picture.

In Q1 2017, the differentials remained as high as in the previous quarters. The entry level unlimited data tariffs in the countries at the high end of the spectrum were more than twice as high as those at the low end. The entry level tariff with unlimited 4G data in Austria was $23 PPP while in Slovenia it was $51 PPP (Figure 6).

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Figure 6. Entry level monthly charge for unlimited data on residential 4G LTE tariffs, Q1 2017 (tariffs with tablets excluded)


1.3 Country ranking

Comparing countries by using the average cost of mobile broadband subscriptions is a straightforward idea but the variation in entry level versus median and average costs can be significant. To help provide an easy way of comparing directly we have taken the $PPP data on entry level, median and average tariffs, produced rankings and then compared the variance (Table 1).

Table 1. Country scorecard by residential 4G LTE tariffs, Q1 2017

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We have included a ‘variance’ column to indicate how the different ranks for the different metrics are spread.  We see that the wide spread in Portugal and Spain for example is represented by high variance.  At the other end of the variance scale countries like Italy or Lithuania rank rather consistently.

2 What we measure

The mobile tariff database covers nearly 2,000 tariffs from all major mobile broadband providers from EU-28, Norway and Switzerland. In total, we provide data on 88 operators from 30 countries. We track a representative sample of tariffs offered by each operator, making sure we include the top end, the entry level and the medium level tariffs, which results in a broad range of prices and data allowances.

We use this data to report on pan-European trends in tariffs and bandwidths offered. We also report on regional trends and variations across countries. The data can also be used to track changes in the tariffs offered by individual operators.

Technologies

We track mobile broadband tariffs provided over 4G LTE and LTE-Advanced technologies. For the sake of brevity, we are referring to both of them as ‘4G LTE’ or sometimes ‘4G’.

Standalone and bundled

We record 4G LTE and LTE Advanced tariffs which are offered either bundled with a device (a tablet, a router or a dongle) or marketed as sim-only. We currently track only monthly tariffs, rather than daily, weekly or pay as you go, and exclude tariffs offered with smartphones.

Residential and business

We report both business and residential mobile broadband tariffs. The analysis in this report for Q3 2016 is based on 1255 residential and 822 business tariffs.

Currency

To allow for comparison between countries with different living standards, this report refers to the tariffs in $ PPP (purchasing power parity).  The data on PPP conversion rates is provided by the World Bank. The tariffs in our database are also available in local currencies, USD, EUR and GBP.

Price comparison issues

This analysis is intended as a general indicator of the trends in 4G LTE service pricing across Europe. There are several additional variables that complicate the process of making a direct comparison of mobile broadband tariffs. They need to be taken into account when making a more in-depth analysis:

  • Device charges: Some 4G LTE monthly tariffs include all charges for devices, for example tablets or LTE modems, whereas others come with additional one-off (upfront) costs which can be substantial. We include all monthly device charges in the total monthly subscription, and it is this figure that is used in the analysis. One-off charges are more difficult to compare as they vary depending on the device and the monthly charge a user is prepared to pay.
  • The range of tariffs and devices: We track both SIM only plans and packages that include devices used for accessing 4G LTE networks, namely tablets and LTE modems. This complicates analysis somewhat, as SIM only tariffs do not include equipment charge and hence are much lower. Having said that, most the mobile broadband tariffs in our database include a device of some sort, as 4G LTE SIM only tariffs are much less common in the market.
  • Bundling: Increasingly, mobile operators are entering the multi-play arena by bundling their mobile broadband services with voice services, fixed broadband and TV. At the moment, the Mobile Broadband Tariffs service provides access to a sample of fixed / mobile broadband bundles from Europe and beyond. We will be adding more multi-play bundles in future. Note: although 4G LTE tariffs which come with a device may be regarded as bundles, we refer to them as standalone mobile broadband services as the device is regarded as ‘equipment’, in line with our fixed broadband tariff methodology. The analysis presented in the current report only refers to ‘standalone mobile broadband’ tariffs.
  • Data allowances: Some operators offer entry level services with very low 4G data limits. From this quarter, the minimum data allowance we include is 1GB per month. In most cases, however, these limits are generous enough for a typical user and, in some cases, even comparable to those offered by fixed broadband providers. An increasing number of tariffs are offered with ‘unlimited’ data usage. To make it possible to include these tariffs in our calculations, we assigned 600GB per month to the unlimited data tariffs. This figure is slightly higher than the highest limited data caps on offer which are 500GB per month.
  • Downstream and upstream speeds: Some operators do not report mobile broadband speeds, not least because they are so variable. Others do, and where this is the case we record the theoretical maximum speed. In reality, the actual average speed can be lower up to 10 times, or more. This should be taken into account when comparing 4G LTE services with fixed broadband, for example.

 

Get access to the full data

Access to the full version of this report, including the analysis of business tariffs, and our latest tariff database featuring some 2,000 mobile broadband services from 30 European countries are available to subscribers of Point Topic’s Mobile Broadband Tariffs service. To find out more, please telephone +44 (0)20 3301 3303 or e-mail simona@point-topic.com

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