Home  >  Article  >  Mobile Tutorial  >  Domestic charges are too cheap! China Mobile, China Unicom and Telecom should learn from foreign 5G tariffs: faster speeds are more expensive, etc.

Domestic charges are too cheap! China Mobile, China Unicom and Telecom should learn from foreign 5G tariffs: faster speeds are more expensive, etc.

PHPz
PHPzOriginal
2024-07-02 11:29:20868browse

According to news on July 2, since the commercialization of 5G in 2019, the performance of the three major domestic operators has continued to improve. 5G has driven the growth rate of operators’ ARPU value from negative to positive, and the total revenue of domestic mobile services has also increased. According to statistics from the China Academy of Information and Communications Technology, 5G will directly drive my country's total economic output to 1.86 trillion yuan in 2023, which will have a significant impact on the economy and digital transformation. However, what needs to be noted is that after the first half, the operator's 5G DOU has reached a high level and traffic growth has slowed down. As 5G-A begins large-scale deployment in China, 5G network capabilities will reach a new level. This lays a more solid foundation for operators to explore the adoption of new multi-dimensional billing models including rate-based, thereby further increasing revenue. Globally, especially in the European market, many operators have successfully practiced this, which is worthy of reference in the domestic market. The 5G rate billing model is becoming more and more common around the world. What is the rate billing model? In the context of mobile network services, the rate billing model includes three major connotations. One is intergenerational/highest rate, that is, the highest rate that a mobile phone can achieve after accessing the network, which is divided into uplink and downlink rates and standards (4G or 5G). It is generally a key indicator for grading package levels; the second is certainty/minimum guarantee, that is, the lowest rate that can be achieved after the mobile phone is connected, which is also divided into uplink and downlink rates and sub-standards; the third is differentiation/priority, that is, Users with higher speed packages have higher access priority. From a global market perspective, Finnish operators have provided rate-based tariff packages in the 4G era, which include unlimited data traffic. In the 5G era, several major Finnish operators have continued this model. Taking Elisa as an example, the operator offers different 5G packages including 300Mbps, 600Mbps, 1000Mbps downlink speeds and the "highest speed" Premium package, all of which provide unlimited data traffic. Speed ​​remains the main driver of 5G upsell in the country.

Domestic charges are too cheap! China Mobile, China Unicom and Telecom should learn from foreign 5G tariffs: faster speeds are more expensive, etc.

Importantly, financial report data shows that after entering the 5G era, Finnish operators not only achieved increases in revenue and ARPU, but also saw the user churn rate of Finnish operators reach the lowest level in the past 10 years. Taking Finnish DNA as an example, the operator's revenue will increase by 8% in 2023, and mobile ARPU will increase by 5%. In the first quarter of 2024, revenue increased by 6% year-on-year, and mobile ARPU increased by 7%.
“Now, in the 5G era, operators in other regions have also begun to adopt the 5G rate billing model.” Nicole McCormack, chief analyst of broadband and bundling pricing at market research company Omdia, told C114 that according to Omdia estimates, about 20% of the world’s 5G Operators have launched package services of different speed levels for smartphone users. The success of the "Finnish model" has attracted many operators from other countries to join this team.
Among them, KPN in the Netherlands introduced a new rate billing package in the first quarter of 2024, with immediate results. Mobile service revenue increased by 7.8% year-on-year, 30,000 new postpaid users were added, and ARPU increased by 5% year-on-year. In addition, the Bulgarian market will begin to introduce rate charges for commercial 5G in 2020. During 2020-23, the average ARPU of operators in the country increased by 8% and DOU by 40%.
5G-A makes rate billing further possible
Currently, my country’s 5G user access traffic accounts for more than 50%, and 5G has become the main network for traffic carrying. However, according to statistics from the Ministry of Industry and Information Technology, my country's mobile data traffic business revenue in 2023 will be 636.8 billion yuan, a decrease of 0.9% from the previous year, and the growth rate of mobile data traffic business revenue has slowed down. At present, everyone's traffic anxiety has almost generally disappeared, and new "pain points" have begun to manifest themselves as users' need for higher-quality network connections.
As early as 2019, when 5G started commercialization, China Mobile proposed to explore multi-dimensional 5G billing models, such as billing by traffic, rate, bandwidth, delay, slice, and function. During MWC Shanghai in 2023, China Academy of Information and Communications Technology and GSMA 5G IN jointly released the "5G Business Model Innovation and Development White Paper (2023)", which also demonstrated the new exploration of pioneer operators in 5G billing methods in the mass consumer market.
This shows that domestic operators have been actively discussing and exploring new multi-dimensional billing models to ensure better service experience for users. Moreover, in the current 5G packages, domestic operators have tried to include the highest speed in different network rights such as exclusive and high-speed, but it is not explicit, and relatively speaking, users have not paid much attention. However, this does not count as a true rate billing model.
Obviously, operators’ multi-dimensional monetization capabilities for packages will continue to evolve with the upgrades in network capabilities, terminal development and other aspects. In 2024, China will take the lead in launching large-scale deployment of 5G-A. This will lay a more solid foundation for operators to provide multi-dimensional billing models based on rate. This is because these new billing business models have higher requirements on the network, and the enhanced network certainty and reliability of 5G-A will enable operators to better fulfill promises such as speed and latency. At the same time, in the 5G-A era, the introduction of new models such as rate charging is also expected to help operators achieve the "next hop" for 5G monetization.
The successful experience in the European market has shown that after operators greatly promote the growth of revenue and mobile ARPU value through the rate billing model, operators are more focused on creating the best experience for users. This actually forms a positive cycle of industry development: operators launch rate billing packages to increase revenue and ARPU. The increase in revenue further drives operators to optimize and upgrade 5G networks to provide users with a better experience.
Cultivating user habits to change overnight is not advisable
Nicole McCormack said that it is easy for operators to introduce rate-based billing package plans in 5G services, because rate-based billing has existed in the wired home broadband field for many years, so consumers are not interested in it Not unfamiliar.
But she emphasized, "The key is that telecom operators should let consumers understand the peak speed - even publicize in the market what different speeds mean for different application performance, and how the experience will be different."
From the international market It seems that unlike Finland's comprehensive rate-based billing model, many operators have adopted a dual billing model - not only providing rate-based packages (stratified according to different rate levels, most of which provide unlimited data traffic), but also providing Traffic-based packages (billed according to traffic package size).

Domestic charges are too cheap! China Mobile, China Unicom and Telecom should learn from foreign 5G tariffs: faster speeds are more expensive, etc.

1. KPN of the Netherlands launches 5G packages based on rate billing and traffic package billing at the same time.
  1. Domestic operators can first launch rate billing models for high-end packages, including peak rates, scene experience guarantees, etc.
  2. The rate tiers of rate billing packages need to include the highest rate, minimum rate guarantee, network priority access, etc., so that users in different tiers can clearly perceive differentiated services.
  3. Taking the rate billing model as the entry point, high-quality, reliable, and differentiated 5G services will become the development focus of my country's operators in the 5G-A era.

    Domestic charges are too cheap! China Mobile, China Unicom and Telecom should learn from foreign 5G tariffs: faster speeds are more expensive, etc.

The above is the detailed content of Domestic charges are too cheap! China Mobile, China Unicom and Telecom should learn from foreign 5G tariffs: faster speeds are more expensive, etc.. For more information, please follow other related articles on the PHP Chinese website!

Statement:
The content of this article is voluntarily contributed by netizens, and the copyright belongs to the original author. This site does not assume corresponding legal responsibility. If you find any content suspected of plagiarism or infringement, please contact admin@php.cn