Price plans hold back 3G

The number of 3G subscribers could hit 70 million worldwide by the end of this year, visitors to February?s 3GSM show were told. However operators must reduce tariffs, focus on improving the user experience and expand coverage if they are to attract more customers.

The mobile technology showcase in Cannes saw manufacturers announce various new devices to encourage business customers onto mobile services. Operators and vendors alike agreed that mobile vendors must now focus on taking cost and complexity out of 3G services.

T-Mobile chief executive Rene Obermann said the subsidy model of European pre-pay 3G services needed to be altered to keep existing customers and attract new ones. "Sixty percent of customers are concerned because they don't know what they are going to be charged," said Obermann. "That must change. We need worry-free bucket tariffs and predictable bills."

Bal Balaji, chief technology officer for 3G mobile platform developer SurfKitchen, agreed that the market for business data services is being held back by high tariffs. But he expected prices to fall soon.

"The devices are there, the networks are there, but the tariffs are not there. Operators have to reduce them and will probably start with certain subscription-based services to get people onto them," he said.