$99 Dollars of Calls On the Wall, $99 Dollars Of Calls

Beer drinkers know the song that starts out 99 bottles of beer and as each verse goes by, the number drops. Well that's about how I feel about the new pricing models from the USA based mobile operators on what's going to happen. Om points out that the new pricing favors the heavy user more than the light to medium user. I'm buying that. He also points out that with the calling plans coming front and center that it may be time to ditch the land line at the office. That I'm not buying as much for a few reasons. 1) People in an office environment transfer calls to one another. Maybe at GigaOm that doesn't happen often, but it does in other work environments. Telling someone to call back on another number just doesn't work as well, meaning a hosted PBX that connects to a mobile phone, but can handle the call session is a useful combination. Currently none of the mobile phone operators offer a mobile PBX capability which is sorely needed. 2) In building coverage isn't all its cracked up to be. Maybe in the low rise Pier 38 offices in SF where GigaOm has their offices the AT&T coverage on Om's iPhone is good enough, but more and more as I'm in hotels and high rise buildings finding a signal that makes a cell phone call as good in the USA sound as good as it is in Europe is pretty hard to find. Hence the need for Femtocells and dual mode WiF will continue to gain momentum (see previous post). 3) The safety net approach. Many people who have busted their monthly plan's limits more than once will likely take the "insurance" of it never happening again, and opt for the unlimited plan. Don't be surprised to start seeing some bundle offers as promotion to upsell the users. I'm expecting all kinds of handset manufacturer tied programs to come down, as well as other more tempting plays. Bottom line is we're seeing the first shot in what will be a pricing war. My take on all this is that the new plans will get more difficult to evaluate as the price of $99 becomes $98, and what's included gets more complex. It's one of the reasons why you can expect mobile companies to be more aggressive with ringtones, applications and services over the next 24-36 months, as each brand starts to want to better define what they have to offer, who they are looking to serve and what they are going to charge.

Comments

[Markus Göbel]

So many people will overpay now, only for being scared of one expensive bill they got. Hjalmar Windbladh has a great text in the Rebtel blog about Vodafone earns billions because people buy too big packages they never really use. A friend of mine wants to buy Vodafone's mobile data and voice flatrate in Germany for €100 per month. Seeing his usage pattern I am sure that he would need only €50 if he would pay per minute and byte for a good contract. But he is afraid.