Mobile operator Orange Spain has launched a summer promotion to encourage its customers to upgrade to 4G/LTE-enabled phones. Under the offer, called Plan Estrena 4G, customers who trade in an old device will receive double its usual value as credit toward a new 4G device. For example, trading in an iPhone 4s will be worth a €100.00 (US $110.00) credit toward an iPhone 6, instead of the usual €50.00 (US $55.00). The credit for the old phone can be either in the form of a discount coupon for use in Orange shops or a bank transfer. The offer is valid for all customers who buy a 4G phone with a postpaid plan by 31 August. According to Orange, over 3 million customers already use its 4G network in Spain.

Tarifica’s Take

Over the past several months, Orange has announced that it will invest tens of millions to over a hundred million euros in each of several Spanish regions—including Madrid, Valencia, Asturias, Seville, and La Mancha—for the promotion and development of 4G networks over the next three years. If the operator is going to spend this kind of money, it is going to need to take other steps to ensure return on the investments—specifically, it will need to incentivize customers to fully utilize the new high-speed service. Putting the right devices in their hands is an essential part of this effort—along with advertising that promotes the capabilities of 4G and the offering of value-added services that leverage 4G—and this doubling of credit seems to us generous enough to accomplish the goal. And since the most data-hungry customers, those who would benefit the most from 4G and use it the most, tend to be on postpaid plans, it is logical that the credit offer is targeted to that sector.