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There's nothing hugely different in the way 5G operators are pricing plans for consumers.

Most operators still stagger offers by data volume – as of 3Q19, eleven operators offered data tiers. These data allowances are much larger with 5G. For instance, if the user takes a 5G handset bundled with a plan, the select plans they can choose from include much fatter data allowances (that are more expensive). Speed tiers are also not new, but the speeds have increased to up to 1Gbps peak download speed.

Meanwhile, some operators have introduced two pricing models. One hybrid model example sees telcos offer speed tiers which come with unlimited data, alongside volume-based plans for those that do not want unlimited data for 5G.

Some operators have introduced no new plans for 5G (the "do nothing" category), while other operators are differentiating around services (not data size) as their main strategy (e.g., if all 5G plans are unlimited). We rank the differentiate strategy as the most innovative as upsell levers – including 5G-rich services – are crucial.

There is huge variation within these 5G pricing strategies:

  • Some operators have launched 5G SIM-only plans, others prefer to bundle 5G handsets only with plans. Others do both.

  • Some brand plans as "5G plans", others allow 5G on certain offers but do not brand them 5G.

  • Some say 5G is available to all customers, but most restrict plans to certain ones (e.g., the fastest speed tier).

  • Some have launched targeted 5G offers, for example, for student, seniors, or youth plans.

  • Some have small-to-large data buckets, some limit data tiers to large (e.g., 100GB, 200GB, 500GB, and 2TB) sizes.

The bottom line is that two golden rules of pricing still exist – keep it simple, and factor in the upsell. We have seen some classic fails in terms of keeping pricing simple for the consumers to understand. Even this telecoms analyst has struggled to understand many a 5G price plan! For instance, one operator has 5G-branded plans in the market (they are onto their second reiteration of these), but the fine print says enjoy free 5G until mid-2020. What happens after that? Having different pricing/plans for different devices is just confusing and speeds need explaining too. Does the average consumer know what the difference is between a 2Mbps and 10Mbps mobile plan? I doubt it.

Upselling choices must be transparent and easy to understand. It's easier to upsell consumers to a 5G plan than merely offer 5G on all plans. Differentiation eventually will come in the form of 5G-enabled services, but that's a rarity today due to the immaturity of services, such as VR and AR. Last, we are glad to see moderate 5G premiums exist – after all 5G network investments have to be paid for somehow.