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Groundbreaking new 4GEE network impresses channel

Samantha Tomaszczyk
November 8, 2012

Partners praise ‘competitive’ price points and ‘excellent’ branding as UK’s first LTE network launches

EE’s newly-launched 4G tariffs were given the thumbs up by some of the operator’s biggest distribution, retail and B2B customers after the network went live last week (October 30).

Mobile News spoke to a number of EE’s selected partners immediately after the tariffs were announced and the operator received praise for its pricing and the simplicity of its tariff offering.

Carphone Warehouse Business head of partners Bob Sweetlove (pictured bottom left) described the tariffs as “truly groundbreaking” and praised the “competitive” price points and “excellent” branding.

Avenir Telecom managing director Andy Tow (pictured top right) also heaped praise on EE for the price points it is offering across business plans, which he claims “should help” EE ensure solid sales.

Managing director of retailer Fonehouse Clive Bayley (pictured bottom right) described the tariffs as offering “fantastic value” for customers and said the 4G speeds and services available will “open up a whole new world” of opportunities.

Speaking at the launch, EE chief of sales Marc Allera (pictured top left) said: “There is a big market for business, particularly small businesses which are using a lot of data on the move.”

Prices for 4GEE tariffs, with a 4G smartphone, start at £36 per month for consumers and £30 for business customers, depending on data bundles taken.

Both consumer and business contracts are 24 months and include Wi-Fi access to the cloud.

For £30 per month, small business customers will receive 1GB of data, 1,000 minutes and 1,000 texts.

Tariffs then increase in £5 increments depending on data bundles, and include unlimited texts and calls.

For £35 per month customers receive 1GB of data with unlimited calls and texts, £40 per month for 4GB, £45 per month for 8GB and £50 per month for 16GB.

EE also offers shared data plans for small businesses. This involves a £15 per month per user flat-rate fee, or £25 per month per user for a personal 4GB data allowance.

Business customers can add data bundles to be shared among other users on the account, ranging from £20 for 4GB to £320 for 64GB.

Additional data bundles are also available, with prices ranging from £5 per month for 500MB to £16.50 per month for 4GB.

Shared minute and text bundles are also available, ranging from £20 per month for 1,000 minutes and 1,000 texts, to £200 per month for 10,000 minutes and 10,000 texts.

Three mobile broadband business tariffs are also available, costing £13.33 per month for 2GB, £17.49 for 3GB and £21.66 for 5GB.

For consumers, smartphone tariffs range from £36 per month to £56 per month – each offering unlimited calls and texts and free access to Wi-Fi (the cloud).

£35 per month includes 500MB of data, £41 per month 1GB, £46 per month 3GB, £51 per month 5GB and £56 per month 8GB of data.

Additional data bundles are also available for consumers, ranging from 50MB for £3 to 4GB for £20.

Three mobile broadband tariffs are available, priced £15.99 per month for 2GB, £20.99 for 3GB and £25.99 for 5GB.

Speaking at the launch last week, Allera added: “What we wanted to do, and I think we have achieved this objective, is to bring something very simple to the UK.

“And you’ll see with all the plans coming with unlimited calls and texts, customers will only have to make a choice regarding what amount of data they need. It’s a very, very simple set
of tariffs.

“Customers basically get access to 4G superfast mobile internet, which is five times faster than 3G, for £36 a month, on the entry-level price plan. This comes with 500MB of data, which for many people is more than enough.

“If you compare like for like against Orange it is about £5 a month more to use 4G than 3G.

“There are a huge amount of consumers now who use a huge amount of data on their smartphones. They use their phone more for data than they do for talking and texting. So for them to get five times faster access is a really good thing.

“A large proportion of the market are on tariffs costing between £30 and £35 per month, so to upgrade to 4G for only £5 extra a month is a really compelling proposition that should open up a large part of the market to us.”

4GEE went live on 30 October in 11 UK cities, with an “aggressive” roll-out plan in place to extend to five further cities by the end of the year.

Roll-out to more cities and rural locations is planned for 2013, with an expected 98 per cent coverage of the population by the end of 2014.

What the analysts say

Steven Hartley,
Principal strategy analyst
The pricing positions the brand at the high end of the customer spectrum, but the premium to legacy services aren’t as high as those seen elsewhere. This suggests aggressive targeting of its rivals’ most valuable customers awaits.

When considered against other unlimited minute and text plans on high-end devices (like the iPhone 5 or Samsung Galaxy S III), prices are similar. But EE customers would also have to pay £49 for a 16GB device, whereas it would be free on other networks, such as O2. Compared to the high premiums charged for LTE at launch across Europe, though, this is refreshing, even if it will not appeal to everyone’s budget.

The lack of a high premium means that EE can emphasise LTE’s benefits. These should prove popular in the UK, where network performance is generally poor compared to the rest of western Europe. Instantly available, high-quality video and web pages give EE a big marketing advantage over its rivals. Combined with a limited price premium, EE’s rivals will no doubt be nervously awaiting its impact on high-spending, high-margin customers.

Paul Lambert,
Operator strategist analyst
By offering LTE at an entry-level £36 per month for 500MB of data, with unlimited calls and SMS, EE has shown that it wants LTE to be accessible to its entire postpaid mobile broadband user base. At the same time, EE hopes to realise a premium on LTE from those who want more data use: all EE’s LTE price plans are at a £5 per month premium to its 3G price plans, with the most expensive being £56 for 8GB. Although it will see considerable competition on these prices when its rivals launch LTE next year, EE is unlikely to have to reduce prices by much to maintain competitiveness, and could get away with offering more monthly data on each of the current tariffs.

Alongside LTE, EE is looking to differentiate from rivals by offering value-added services that include a phone backup service, a film download and streaming service in co-operation with Filmflex, a music service from its Deezer unit and a new set of roaming tariffs to encourage data usage while travelling. Prices in Europe range from £1 for 3MB to £35 for 200MB, or £70 for 500MB with mobile broadband, as well as an option to pay £5 per month for unlimited data roaming. EE roamers will have to sign up for one of these roaming packages when they connect to a foreign network via a dedicated roaming screen.

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