European Users Are Willing To Pay A Premium For 3G Handsets And Services

Forty two per cent of European mobile phone users are interested in 3G services, according to the TNS Telecoms 3G 2003 report, carried out in 10 countries. But the good news for telecoms operators and manufacturers is that the majority of those users interested in 3G were prepared to pay extra for 3G handsets and services.
Half of these respondents who stated that they were interested in 3G services (21 per cent of all mobile users), said they would pay an additional 6 to 10 euros per month for some 3G services such as MMS, high speed internet and emails. With the report showing that the average monthly invoice for a mobile phone user in Europe is currently at 26 euros (20 euros for prepaid and 37 euros for contract) operators have the potential to substantially increase their average revenue per user (ARPU).

Similarly, those interested in 3G services would also be happy to pay more for a 3G handset than they paid for their existing one. Across all countries surveyed, the majority of respondents would be willing to pay up to 330 Euros for a 3G handset. However this figure changes considerably by country, depending, among other reasons, on whether handsets are subsidised by the operators, as in France or the UK.

Alan Imbert, Senior Research Director, TNS Telecoms explains: “The fact that operators in many countries have subsidised mobile phone handsets could prove a major stumbling block for the uptake of 3G in some European countries. If operators chose not to subsidise 3G handsets then users may be shocked to find that they will have to pay many times more for the new 3G models than they do for existing handsets.”

Other interesting findings:

Which services are users most interested in?
Of those users across Europe that did express an interest in using 3G applications, most are interested in sending and receiving emails on their mobile phones (77 per cent) or using videophones handsets (77 per cent). They are least interested in downloading music files and viewing video clips (47 per cent and 40 per cent respectively were interested).

Who is interested in 3G?
On average, 42 per cent of all mobile phone users are interested in 3G. Interestingly, mobile phone users in Eastern Europe show more interest in using 3G applications than their counterparts in Western Europe. Fifty nine per cent of users in Turkey and 51 per cent in Poland said they are ‘ interested’ compared to only 34 per cent in the UK or in Germany. Forty eight per cent of men are interested in 3G compared to only thirty six per cent of women.

Which companies are in the best position to capitalise on 3G?
Unsurprisingly, it is the leading national mobile operators that European mobile phone users most trust to provide reliable 3G services within the near future. On a scale of 1 to 10 (where 10 represents a “ high ability” to provide reliable 3G services), European mobile users give a rating of at least seven to the national mobile operators. It is the smaller providers, those with less than 20 per cent market share, that will struggle to convince users that they can offer reliable 3G services.

Alain Imbert adds: “Our report suggests that attitudes to 3G may be changing in Europe, but that mobile providers, especially the smallest ones, will need to put much time and effort into communicating both the benefits of 3G services and their ability to provide consumers with reliable services”.

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