Sunday, March 07, 2010

3G arrives, what it means

Orange Jordan has announced the country’s first third generation mobile network, called 3G+. This is a significant turning point for the evolution of mobile Internet access and content distribution in Jordan. Video calling, mobile TV viewing and Internet browsing at speeds of up to 14.4Mbps are now possible.

In an interview with a regional publication, several months ago, Orange CEO Nayla Khawam said that she hoped “that being able to offer 3G services would inject some value into a market completely and exclusively price driven".

So, the first thing worth looking at is Orange’s pricing strategy for the 3G service.

And here it is. Pay-As-You-Go customers can get one of three bundles. 100MB for JD3, 200MB for JD5 and 1GB for JD15. Not bad.

Pre-paid subscribers have a choice of a JD20 or JD40 package, both with unlimited mobile Internet, but varying call minutes and SMS offerings. The maximum offer for pre-paid subscribers is JD80 for unlimited ‘everything’, except international. That’s good, considering many people’s bill, without Internet, exceeds that.

To use 3G, you’ll need to get a new SIM card and your handset should also support the service.

The investment Orange made to introduce 3G was significant. Orange was awarded a 15-year license, in August 2009, for JD50 million (US$70 million), following a long process that started in 2008. 3G coverage will begin in Amman and some governorates, reaching full coverage of the country by August 2010.

For one year, starting at the date of introducing the service, Orange users will exclusively enjoy this 3G service. Afterwards, Zain and Umniah may obtain a 3G license if they meet the required criteria. So, if you’re not an Orange customer, you’ll have to wait.

It’s another exclusive for Orange, following the exclusive Apple iPhone deal. This evolving, differentiated offering by Orange is clearly giving the telecom operator more market penetration, probably at the expense of the current mobile market leader, Zain.

It’s worth noting that there’s a relatively slow uptake of 3G services in regional markets, although it’s been available for a few years.

For 3G to gain critical mass, and become a mainstream service, it’s prices will have to come down, and competitors will have to enter the 3G service market. However, maybe now the time is right and the thirst for high-speed mobile data services will surprise market watchers, at this early stage and even with only one operator delivering a 3G service.

If Orange provide market feedback and sales data in a few months, we’ll gladly report on it. It will be interesting to see if, finally, a significant number of Jordanians enter the world of high-speed mobile Internet.


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