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The Cost of Mobility: Comparing the Value of Fixed and Mobile Broadband

The Cost of Mobility: Comparing the Value of Fixed and Mobile Broadband

Posted by Shara Evans in Market Clarity Newsletter 25 May 2011

25 May 2011

In the current NBN debate, a popular notion is that 3G (and the coming 4G) mobile wireless services are the future of telecommunications, and will through popularity alone render the NBN obsolete – in the market, if not in the technology.

Market Clarity has decided to make our own contribution to this debate, by analysing the relative cost and value of fixed vs. mobile broadband. The result of this analysis is outlined below, and published free on Market Clarity’s website.

We are also happy to announce the launch of two new price benchmark studies, which examine Wholesale Ethernet and Dark Fibre service prices.

  • The Cost of Mobility: Comparing the Value of Fixed and Mobile Broadband
  • New Research: The Wholesale Ethernet Point-to-Point Services Price Benchmark Report
  • New Research: The Dark Fibre Price Benchmark Report
  • Upcoming Events

 

The Cost of Mobility: Comparing the Value of Fixed and Mobile Broadband

  • On a per-GB basis, mobile broadband costs between $1.66 and $80.
  • A GB worth of downloads on mobile broadband can be as much as 1,333 times as expensive as a GB of fixed broadband usage.
  • Median fixed broadband data allowances are 100 times the median pre-paid “recharge” volume, and 40 times the median post-paid volume allowance.

While hugely popular, mobile broadband still attracts premium pricing on a per-GB basis, according to a new free report published by Market Clarity.

The Cost of Mobility: Comparing the Value of Fixed and Mobile Broadband took a benchmark of broadband charges in mid-March. These were analysed to yield a comparative value of services, based on the per-gigabyte price of data volumes on three broadband service types: fixed broadband (ADSL and HFC), post-paid mobile broadband, and pre-paid mobile broadband.

Market Clarity believes that mobile broadband has proven its popularity and capability in the Australian market – especially in the age of Apple’s iPhone and iPad, devices based on the Google Android operating system, and Windows-based tablets and phones.

However, information usage remain much more costly on mobile services compared to fixed broadband connections. This has important implications in the NBN debate, since some opponents of the government’s broadband rollout believe that mobile devices will supplant fixed networks, rendering the network (if not its underlying fibre technology) obsolete.

Regardless of whether technical criticisms of mobile technology (that it lacks the capacity to serve all users’ broadband needs) are correct, Market Clarity believes abandoning the NBN to focus on mobile broadband would be a poor value outcome for Australians. We would find ourselves served by networks in which information usage attracts a high premium, which would effectively cap subscribers’ ability to use newer, more demanding applications in the future.To conduct this analysis, Market Clarity captured mobile broadband plans from all major carriers, and compared these with fixed broadband (ADSL and cable) plan prices from Australia’s dominant ISPs. We believe the fixed broadband plans sampled represent more than 90% of Australia’s fixed broadband customer base.

Market Clarity is offering this report, The Cost of Mobility: Comparing the Value of Fixed and Mobile Broadband, as a free download.

 

New Research

Market Clarity is pleased to announce the launch of two new price benchmarking reports, The Wholesale Ethernet Point-to-Point Services Price Benchmark, and The Dark Fibre Price Benchmark.

These reports are the result of ongoing price benchmarking research conducted by Market Clarity.

 

Wholesale Ethernet Point-to-Point Services Price Benchmark Report

In this report, Market Clarity analyses data from ten carriers offering wholesale Ethernet point-to-point services. This data represents contractual service price data obtained from carriers and their customers.

The report presents the range of Low, Median and High industry prices that would apply to Wholesale Ethernet links falling into the above-mentioned zones. Price information is available for Wholesale Ethernet Point-to-Point Transmission Services at speeds of 2, 10, 100 Mbps and 1 Gbps. In addition to providing a range of market tariffs, Market Clarity also provides the capacity price ($/Mbps) for each bandwidth speed.

Further information is available here.

 

The Dark Fibre Price Benchmark Report

In this report, Market Clarity analyses price data for twelve (12) dark fibre infrastructure owners. The data represents contractual price points obtained from fibre operators and their customers.

The report provides low, median and high industry prices for dark fibre services in eleven distance bands, up to 400 Km.

Further information is available here.

 

Upcoming Events

Market Clarity’s CEO Shara Evans will be presenting a paper “Predicting Australia’s Broadband Future” at the Australian Computer Society’s NSW June meeting.

Drawing on Market Clarity’s analysis, Shara will examine the future of the Australian Internet market – discussing consumer and business trends from the last decade, and forecasts for the next five years. Shara’s talk will examine historical and forecasted service take-up and revenue for residential and business broadband, connections, speeds, access types, and metro / regional considerations.

Shara will also present Market Clarity’s research into the variations between fixed and mobile broadband costs, and how this influences consumer behaviour.

The talk will be held at the Australian Computer Society Event Room in Sydney on 24 June 2011.

 

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