THE 5G PARADOX – INCREASED PRICING MEANS MORE DATA AND HIGHER SPEEDS.
The highest 5G price levels and data allowances are to be found in the Middle East. Overall 5G will follow existing country market pricing trends.
The latest 5G Pricing and Analysis from Telecomspricing shows increases in 5G pricing, speeds and data allowances: 5G average prices are now USD $79.97 per month the US, in return for more data & higher speeds.
Telecomspricing, providers of independent research for the world’s telecoms industry, has examined the 5G pricing plans of 36 MNOs pricing plans as of the beginning of 2020, and finds that average 5G pricing has risen from USD $69.75 up to USD $79.97 an increase of almost 13% over the last quarter (from October 2019 to January 2020).
The main reason for the increase has been the inclusion of new 5G plans from MNOs in the Middle East which include unlimited or very high monthly data allowances – as high as 1,000 GB and up to 6,000 GB (or from 1TB up to 6TB (TB = Terabyte or 1,000GB) per month). As a result, the average 5G data allowance has increased to 303 GB – up from 56 GB as of October 2019 – due to the introduction of high allowances for smartphones and home routers in the Gulf States.
Over the last quarter period there have been a number of trends in 5G services which will have an impact on the future development of the sector worldwide into 2020:
” The highest 5G price levels and data allowances are to be found in the Middle East. Overall 5G will follow existing country market pricing trends. ” – The highest price levels are found in Kuwait, Qatar and Saudi Arabia which also have the highest mobile data allowances. However, the price premium charged offer regional disparities for pricing, with Post Pay rental rates already being higher in the Middle East than in other regions. Overall 5G will follow existing country market pricing trends rather than eradicate them.
Although the average 5G data allowance looks high the actual number of plans show a more nuanced story – Out of the 121 x 5G plans surveyed worldwide, the greatest proportion (some 41%) consist of mobile data allowances of less than 100 GB per month. The single most common allowance is 100 GB. One of the reasons for the cautious approach in providing data bundles appears to be the determination of MNOs (particularly in South Korea and China) to offer lower cost 5G entry level pricing with mobile data allowances starting as low as 8 GB and 30 GB respectively.
MNOs appear wary of charging a price premium for 5G services – Although still at an early stage, MNOs are offering 5G at a small or no premium charge to normal mobile data services.
5G theoretical download speeds offered have increased sharply – The average advertised 5G download speed has increased – from 582Mbps up to 736Mbps, with a number of MNOs claiming 5G download speeds of 2Gbps, with the most common average advertised download speed now being 1,000 Mbps (52% of all plans). It should be noted that independent verification of these speeds is yet to emerge, and that 5G download speeds could reduce as more users join the network leading to more congestion.
And 5G is soon poised to enter the mainstream as more MNOs offer lower cost entry-level packages and the availability of lower-cost 5G smartphones starts to improve later in 2020. These two trends have the potential to make 5G the transformative technology of the year.