Philippine mobile operator Smart Communications has introduced data-only LTE services on a prepaid basis. A bundle with USB modem costs PHP 5,995 (US $145), one with an LTE Pocket WiFi device costs PHP 6,995 (US $170), and a SIM card-only package costs PHP 350 (US $8.49). Top-ups start at PHP 50 (US $1.21) for one day, followed by PHP 299 (US $7.25) for 7 days, and PHP 995 (US $24.13) for 30 days. The packages all offer unlimited data until June 30.
We think Smart has taken a great approach. There is a large, relatively untapped contingent of users from whom operators could actually generate proportionately more revenue on a prepaid basis than on a postpaid basis. Nowadays, there are plenty of people, even at the higher end of the market, including business users, who do not require data services regularly and who instead prefer buying them on an as-needed basis. Over the long haul, this pay-as-you-go approach ends up being more expensive for the user than a comparable postpaid plan resulting in higher margins for the operator. That’s what we call a win-win situation.