Expensive MMS services

18 December 2001
The next generation SMS services MMS (Multimedia Messaging Service) will be quite expensive. The Norwegian telecom company Telenor will be one of the first operators to offer MMS next year. According to Dagens Næringsliv (DN) the cost of sending a MMS message will vary between NOK 30-40 (EUR 3,70-5.00). For these services to become profitable, the income must divided between the operators and content providers in a more reasonable way says John Strand from Strand Consult. The price discussion is not interesting says Strand. Mobile operators and content providers must instead discuss how they are going to create more traffic so that the marked is getting larger. Strand is of the opinion that the operators should reward content providers with a good brand and services that creates much traffic.

The struggle between the mobile operators and content providers is in a marked where the revenue has increased from NOK 10 millions (EUR 1.24 millions) in 1999 to NOK 450 millions (EUR 56 millions) in 2001.

Norway is a leader in this marked. There is no mobile operator in the world that have more percent of the revenue coming from non-speak services as the two Norwegian mobile operators Netcom and Telenor. Even NTT Docomo lies behind. It's not true that NTT Docomo pays 90% of their income to the content providers. But if Norway wants to advance, the price model must change says Strand.

Strand is of the opinion that the Norwegian operators must encourage their customers to use more WAP services.

The GPRS price model, where customers pay for data transfer must be taken advantage of before the next generation of mobile solutions. The price for using GPRS must be lowered. If Telenor follows the average European price on GPRS usage, a MMS sent picture will cost NOK 12,- (EUR 1.49) to send and NOK 12,- to receive in addition to the NOK 10,- it will cost to be online according to Dagens Næringsliv's calculations. Sigurd Sandvin from Telenor Mobil does not confirm this prices but claims that the price will be lover that DN's calculations. We are going to create a mass marked service and don't want to exclude the youth. They are the most frequent users of SMS services today. Sandvin points out that MMS prices will vary and that sending pictures and videos will be the most expensive usage.

Strand also warns about letting GPRS be a free service like they have done in Sweden. That's completely wrong way to go says Strand. It will be the same mistake as we did with the Internet.

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