x Abu Dhabi, UAEFriday 28 July 2017

Etisalat reduces mobile internet costs

The company cuts the cost of mobile internet access and says it plans further monthly price cuts.

Etisalat has cut the cost of mobile internet access.
Etisalat has cut the cost of mobile internet access.

Etisalat has cut the cost of mobile internet access and will work with the Telecommunications Regulatory Authority (TRA) to offer further monthly price cuts, its vice president for consumer marketing said yesterday. The company has invested billions of dollars in building the capacity of its high-speed mobile broadband network. Like many operators, it is staking much of its hopes for revenue growth on customers spending more on mobile data services.

"We have put a lot of investment into our 3.5G network and we can only bring value through a large-scale adoption of these services," said Khalifa al Shamsi, after announcing a new series of mobile broadband packages that offer data download rates up to 25 times cheaper than their predecessors. "Etisalat has always been continuously reviewing takeup of the service, and if any service is not being taken up, we will change the price level."

More than 100,000 customers have signed up for Etisalat's mobile data plans, but the company believes penetration of the service can be greatly increased. It estimates that there are more than two million internet-enabled "smart" phones in use in the UAE. Prices for mobile internet are significantly lower in many foreign markets. Etisalat's "unlimited" package, which comes with a 10-gigabyte download limit, costs Dh460 (US$125.25). SingTel, the national telecommunications company of Singapore, offers a monthly 50-gigabyte package for S$72 (Dh183.31), while in Hungary, the Vodafone network offers unlimited mobile broadband access for 15,000 Hungarian forints (Dh276).

Mr al Shamsi said one reason contributing to high prices in the UAE was the inability of operators to sign up customers on long-term contracts, an issue the company was discussing with the TRA. "In some countries you have contracts with commitments of 24 to 36 months. When you spread it over a long period it allows monthly instalments to be lower," he said. "The guidelines in the UAE are to not exceed 12-month contracts and one of the areas where we are working with our regulator [is] to have higher contract durations, which will allow contract instalments to be lower. We think it would benefit the users if we could offer longer contract durations."

While mobile broadband has become popular among residents in homes that do not have a landline connection, Etisalat does not want the service to be used as an alternative to fixed-line internet. The 10-gigabyte download limit, combined with a data rate equalling Dh30,000 per gigabyte for downloads above the limit, means the service should not be used for high-bandwidth applications such as movie downloads and streaming TV, Mr al Shamsi said.

"Less than 1 per cent of our users go beyond 10gb. But we do not encourage it to be used as a replacement for a fixed line, because it is fixed-line where we can deliver truly unlimited access," he said. "If you want multimedia, streaming and full downloads, that is for the home lines. Mobile broadband is for full mobility and flexibility. We don't want a small minority of users to affect the experience of the full customer base."