3 Denmark Raises Data Allowances and Roaming Fair Use Without Raising Prices

3 Denmark Raises Data Allowances and Roaming Fair Use Without Raising Prices

Mobile operator 3 Denmark said that it is improving certain subscription plans, such as expanding data allowances by 40 percent to 67 percent for its Fri Tale packages, without raising prices. It is also increasing the roaming fair usage policy for customers on its 3LikeHome tariffs from 10 GB to 20 GB.

The subscription change went into effect on 27 March for new customers and goes into effect on 16 April—the beginning of a new billing period—for existing subscribers. For customers on legacy 3LikeHome subscriptions, the upgrades do not go into effect until 23 April.

The 3 Denmark Plus subscription will now provide 15 hours of talk time instead of 10, and the price remains DKK 80.00 (US $13.30). Fri Tale (unlimited voice) 5 GB subscriptions with 3LikeHome will now supply 40 percent more mobile internet at 7 GB, with the price staying at DKK 130.00 (US $21.65). Fri Tale 10 GB contracts will change to 15 GB ones, at DKK 150.00 (US $25.00). The 20 GB version will now provide 30 GB for DKK 200.00 (US $33.30). The 40 GB Fri Tale subscription will now provide 60 GB, at the unchanged price of DKK 230.00 (US $38.30). The 60 GB Fri Tale service will now provide 100 GB, with the price remaining at DKK 270.00 (US $45.00).

As for its mobile broadband subscriptions, 3 Denmark said the 200 GB package will expand to 250 GB for the same price of DKK 250.00 (US $41.65). The 350 GB mobile broadband package will deliver 500 GB at DKK 300.00 (US $50.00).

Tarifica’s Take

According to Denmark’s Energy Authority, Danish internet use rose by 50 percent in the first half of 2017. This is a very noteworthy statistic, and one that points out the path ahead for mobile operators. With such a dramatic change in usage habits, operators—even in affluent markets such as Denmark—will have difficulty if they plan to continue charging for data at the same rates. Once prices become unaffordable, rather than reducing their usage, customers will be easy prey for competitors willing to undercut on prices. Keeping prices down, as much as possible, as usage expands may cause some pain for an operator in the short run, but it is a sure way to keep customer confidence in the long run.

Eventually, 3 Denmark may choose to raise prices to some extent on these plans, but for now, offering more data and higher fair-use limits for roaming data at the old prices will have a positive effect on subscribers and make increases down the road more palatable. In any case, with data demand rising so sharply, it is not likely that increasing prices in strict accordance with consumption will be a good policy for the future.

In any case, plan changes like these at 3 Denmark reinforce the idea, which we have frequently referred to, that the best opportunities for operators to increase revenue lie not in traditional services but in new services and functionalities. Among these are IoT applications, mobile money, mobile advertising, and content partnerships.