4G LTE Tariffs in Europe: key trends in Q1 2018

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 March 2018

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 Q2 2017 onwards, we only include SIM only data only 4G LTE tariffs and those bundled with a modem. No tariffs bundled with other devices such as tablets or smartphones are included. We made this decision to make this analysis more comparable with fixed broadband services which are not normally bundled with PCs and laptops.

Overall 4G LTE tariff trends

In Q1 2018, the average monthly charge for residential 4G LTE services varied from $53.65 in Cyprus to $24.80 in Luxembourg. Cyprus continues to offer the highest priced products since Q1 2017.

Figure 1. Average residential 4G LTE monthly tariff in PPP$, Q1 2018

In some instances, relatively low average monthly charge comes with high average data cap (Figure 2). For example, countries such as Finland, Denmark, Lithuania and Latvia 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).

Figure 2. Average monthly data allowance, residential 4G LTE tariffs, Q1 2018

Finland in particular stands out in this respect, as mobile operators in this country offer 4G LTE subscribers data volumes comparable to those used by many subscribers with fixed broadband packages, with the average monthly charge at $31.93 .

Figure 3. Average cost per GB of data in PPP$, Q1 2018

One of the factors 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 for their 4G LTE tariffs. Even when they do, the variability between the theoretical maximum bandwidths and the actual ones is much higher for mobile broadband compared to fixed. The actual attainable speeds on 4G LTE networks also vary much more depending on location, even on the same street and within the same building.

Figure 4. Average theoretical downstream speed on residential 4G LTE services, Q1 2018

Nevertheless, Figure 4 shows which countries are investing in higher speed and more advanced 4G networks, including those using the LTE-Advanced technology. Switzerland, Denmark, Slovenia and Austria, among others, appear to offer the lowest bandwidth, along with being the most generous in terms of data allowances. It should be noted that Denmark is a special case in this context. The 71Mbps refers to the maximum download speed that the Danish operators are allowed to market after agreement with the consumer ombudsman. In fact, TDC’s theoretical maximum speed in 2017 was 412Mbps.

Regional and country benchmarks

There will be exceptions at a country level but when comparing the markets of Eastern and Western Europe at a regional level, Western Europe comes out on top in terms of the average data allowance with 120GB per month, compared to 96GB in Eastern Europe. It has gone up in both regions, with 104GB and 77GB respectively recorded in Q1 2017. However, in Q1 2018, 4G LTE customers in Easter Europe were offered on average lower monthly charge at $34.80. In Western Europe, the same indicator was £37.32 (Figure 5). In Q1 2017, the average monthly charge in Western Europe was slightly lower.

Figure 5. Regional tariff benchmarks for residential 4G LTE services, Q1 2018

Among the well-developed Western economies, there is a notable difference between the Netherlands and Sweden on one end of the spectrum and Germany and UK on the other (Figure 6). Consumers in the Netherlands and Sweden are offered higher average 4G data volumes but also pay more for their monthly contracts than their counterparts in the other countries. Meanwhile, Italian 4G subscribers get good value for money, paying the least on average at £25.34 per month but getting the highest average data allowance at 82GB per month. For a similar monthly charge, 4G subscribers in the UK are offered 17GB per month, on average.

Figure 6. Tariff benchmarks for residential 4G LTE services in six major European economies, Q1 2018

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 in Q1 2018

Figure 7. Entry level monthly charge for unlimited data on residential 4G LTE tariffs, Q1 2018

The entry level unlimited data tariffs in the countries at the high end of the spectrum (Italy) were 6.5 times as high as those at the low end (Austria). While many countries did not report data speeds, a comparison of those who did indicates that the monthly charge differences in this case can be explained by varying bandwidth. For example, in Austria where customers paid from $12.49 PPP for unlimited data they were offered theoretical download speeds of up to 20Mbps, in Finland ($19.78) they received up to 50Mbps speeds, while in Croatia ($47.87) the speed was up to 150Mbps and in Portugal ($42.67) up to 375Mbps.

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 2018

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 Spain and Germany for example is represented by high variance.  At the other end of the variance scale countries like The Netherlands or Lithuania rank rather consistently.

Why such marked differences between countries?

There is no simple clear-cut explanation as many factors come into play. The length of time after the 4G networks were launched, 4G service take-up, the market shares of ‘standalone’ 4G and of multi-play bundles, the extent of competition from fixed broadband services with comparable bandwidth, the availability and the cost of 4G spectrum, the regulatory pressures to offer 4G services in remote and rural areas as a priority, the demographic characteristics and life-styles of the users and the cord-cutting tendencies will all have influenced the 4G offerings available in different European markets. A further statistical modelling may provide more insight into these complex differences.

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 more than 800 4G LTE and LTE Advanced 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 [email protected]