7/1/2010 12:21:00 PM
3 goes for contract share with aggressive tariff strategy
3 has launched a new tariff, undercutting its rivals in a bid to grab contract market share.
The ‘One Plan’, which starts at £25 for Sim-only plans, will offer consumers 2,000 any network minutes, 5,000 3 to 3 minutes, 5,000 texts and 1GB of data. The network is launching the new tariff today (1 July) ahead of the expected reduction of mobile termination rates (MTRs). The operator’s chief executive, Kevin Russell, expects MTRs to fall drastically in the first quarter of 2011 following Ofcom proposals earlier this year.
The value plan is an aggressive move from the operator to increase its contract market share as smartphones grow in popularity.
Speaking at a 3 event today, Russell said: ‘In January this year 40% of our sales were smartphones and we estimate that will be around 80% in July.’
The operator has been building the size and capacity of its network over the last three years. However, it said that voice traffic has remained steady.
Russell said: ‘We have not increased one iota in terms of voice traffic. Our number one challenge is termination rates – they are fundamentally wrong and flawed. We have abdicated the contract market and pushed hard over the last three years for MTRs to be addressed.
‘The launch of the new tariff is on the back of a network which is 60% bigger than 18 months ago. We are trying to bundle all your communication needs into one simple price point. This is what we have been talking about for three years and we are not going to wait nine months for reduced MTRs.’
The launch of the new tariff mirrors the aggressive pricing strategy unveiled by the operator for the iPhone 4.
Meanwhile, 3 will stop offering unlimited services such as voice and text. This will apply to all new and existing customers.
The network will begin offering 1GB of data as standard from its mid level contracts upwards. However, 500MB packages will also be available.