EE finds 4G a hard sell

 
Battersea Power Station lit up for 4G launch

Just three months after the launch of the UK's first 4G network, the "Sale" signs are going up at EE. The company has unveiled what it describes as "new price plan offers" to offer customers more choice. But what EE is actually doing is cutting prices in what looks like an admission that it got its initial offer wrong.

When I spoke to the company's CEO Olaf Swantee last October, he was confident about the strategy: "We really think we've priced it at the sweet spot," he said. "It's all based on months of consumer research."

But complaints came thick and fast - in particular about data. The fact that customers upgrading from Orange or T-Mobile would pay £5 more for the same amount of data struck many as unreasonable. After all, the whole point of 4G was that lightning-fast speeds meant that you would want to consume far more data.

Now EE is going some way to recognise that. Its entry price has been cut from £36 to £31 a month - though you still only get 500MB of data for that. (Incidentally, those who signed up at the original price won't be able to switch to the cheaper deal, which is bound to cause anger.)

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Customers who signed up at the original price won't be able to switch to the cheaper deal”

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And it's bringing in a new £46 a month 20GB Sim-only deal designed for what it calls "super-users". EE says it has introduced this after "listening to customers" but still insists that only a tiny minority - less than 1% - of 4G users have shown a desire to have more than the current 8GB limit.

But maybe it's a question of chicken and egg. If the initial prices had not been so high, more people would have signed up and chosen to use more data. That certainly seems to be the message in a report out today from Deloitte that warns mobile networks of an almost insatiable desire amongst smartphone users for data.

When I asked EE whether the new price plans were a response to poor uptake of 4G, I was told the company could not disclose any numbers, but had been "very pleased with the customer response to the launch of EE".

The rest of the mobile industry will be watching this move very closely. With Ofcom's 4G auction starting this month, operators will be wondering just how great the demand from customers is going to be and working out what that means as they bid for spectrum.

Last autumn it looked as though EE had pulled off a coup by getting Ofcom to allow it to launch 4G before the rest of the industry. Now it seems the firm may have done its rivals a favour by running a live consumer experiment on their behalf.

 
Rory Cellan-Jones Article written by Rory Cellan-Jones Rory Cellan-Jones Technology correspondent

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  • rate this
    0

    Comment number 196.

    @birchy

    Your comments on the home servers etc, its unusual for those to be actively blocked by any ISP these days (unless they have reason to believe your doing something dodgy) I'm running very fast fibre broadband and have no issues running any of those services for home use.
    The 4G network is only as good as the signal & back haul to the servers holding the data, connected @ 4G don't mean dot

  • Comment number 195.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this
    +2

    Comment number 194.

    Until the networks and the phone manufacturers realise the vast majority of phone users just want the ability to reliably make a telephone call on their smartphones, the sooner the overpricing of data packages and the hype over smartphones will stop.
    I would happily pay a couple of pounds more a month if my operate could guarantee me 100% call coverage, without calls being dropped, in the UK

  • rate this
    0

    Comment number 193.

    Some history on 3G rollout, especially Orange/EE
    and the real costs of rolling out 3G, lucky escapes, shocks:
    "a customer on that tariff would have to live for another 100 years to pay their contribution towards the purchase price of Orange!"

    http://www.gsmhistory.com/infobox/other-mobile-history/

    It will be interesting to see what the 4G auction brings,
    will history repeat?

  • rate this
    0

    Comment number 192.

    I myself am happy (now) with the customer service. They do have some excellent staff. However it was only after having 600 notes put on my account did they decide to do something about it. Now have 3.5GB data, unlimited roaming mins, texts and minutes for £31 a month with a femtocell which means coverage at home is sorted. However they do need to get their game up in the countryside.

  • rate this
    0

    Comment number 191.

    What most consumers do not realise is that 3G mostly runs on the 2100Mhz spectrum, which is the worst for things like penetrating walls, and working in rural areas. This is why EE is trying to get a big chunk of the 800Mhz which will mean they can vary their spectrum across the country. Their 1800Mhz 4G will work ample in urban areas, and 800 in rural areas. Giving them the best of both worlds.

  • rate this
    0

    Comment number 190.

    My contract with Orange lapsed on December 16th. Being pleased with the service I was looking forward to a new contract & phone. Despite no date yet for 4G in my area I still got the hard sell, and to illustrate the point the choice of 3G handsets on the Orange website is dire. Don't let that put you off though, ask and you will find they are hiding in the warehouse. Ended up with a Sony Experia T

  • rate this
    0

    Comment number 189.

    185.JP
    4 Minutes ago
    183. David H.
    thanks to O2, and in terms of customer support..
    I look forward to their 4G offering.
    ~~~
    Time will tell, from a user perspective what you get will always depend
    on where you are, network, capacity, traffic etc...
    The reason I have stayed with Orange/EE. for 12+ years

    @ Home no EE signal,
    But phone works fine with "Signal Boost" app on SG S2 over BB

  • rate this
    +1

    Comment number 188.

    I for one am so pleased that EE's getting a kicking from consumers :-) Their arrogant attitude to their customers, no doubt carried over from Orange and T-Mobile, simply shows what they are like. Not letting the early customers change down to the new price plan is disgusting. They are a dishonourable company. And no, I'm not one of their customers and never will be.

  • rate this
    0

    Comment number 187.

    The two big problems with 4G is the lack of availability and high cost, but as mobile technology becomes increasingly popular, availability will become widespread and the cost will come down. You only need to remember the early days of flat-screen televisions to understand that. It may not be needed now, but the time will come when people want mobile, on-demand access to the services they want.

  • rate this
    0

    Comment number 186.

    I would probably have been fooled into spending a fortune on data but I don't live in a 4G area
    Phew

  • rate this
    0

    Comment number 185.

    183. David H.

    Tesco are indeed a Mobile Virtual Network Operator. Their service (albeit underpinned by O2's infrastructure) is nevertheless excellent (both in terms of network coverage, thanks to O2, and in terms of customer support). Tesco's pricing is also highly competitive. I look forward to their 4G offering.

  • rate this
    0

    Comment number 184.

    It was an interesting experiment.
    First out of the block does not usually finish first.

  • rate this
    0

    Comment number 183.

    180.JP
    33 Minutes ago
    [Tesco has been excellent]
    ~~~
    Tesco is a MVNO, runs on O2 network

  • rate this
    0

    Comment number 182.

    169.Rev
    56 Minutes ago
    No one I know who uses EE would recommend them including myself .
    ~~~
    I've been involved in Mobile & Data since 1985
    The laws of physics & propogation(coverage) are the same today.
    Capacity & Traffic management will vary by Network/Location.

    I've been with Orange/EE for 12+ years, no desire to change.
    (especially with mobile discounts & Fibre BB bundle @ Home)

  • rate this
    +1

    Comment number 181.

    Having a super fast download speed is only part of the equation. The other end has to a) have a super fast upload speed and b) be able to cope with thousands of concurrent connections.

    If you are paying for a service such as NetFlix/SkyGo etc. then there is incentive for the provider to pay for decent upload speeds & contention ratios so 4G might make sense, but for everything else 3G will do.

  • rate this
    +1

    Comment number 180.

    It would appear that NN's [Nothing Nowhere's] customer service is becoming legendary. Having experienced truly shocking customer service from them last year (and swapping networks [Tesco has been excellent]), it is no surprise that NN have totally misjudged the market. The introduction of the serious network operators to 4G is long overdue and should create a welcome change in the landscape.

  • rate this
    +1

    Comment number 179.

    What should have happened is 3G should have fully replaced 2G and then 4G replace current 3G coverage..... Instead they market it as something special and try to charge more for it.
    This is like your water supplier turning up your supply pressure by a few bar and then charging more for it.
    4G doesn't exist in anywhere near the form that its been marketed, a scam by any other name.

  • rate this
    +1

    Comment number 178.

    Having been a user of 4G for 3 months and the continuing problems I have entailed I would not recommend EE to anyone even with the cut down prices.
    Every service they have "provided" I have had to speak to customer service as there have been issues - I don't believe there is enough space here to jot it down.

  • rate this
    +1

    Comment number 177.

    The currently appalling customer services from EE are going to catch up with them at some point. As has already been mentioned nobody is going to recommend them

 

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