Smartphone tariffs: Germany, US charge ′exorbitant′ prices | News | DW | 01.12.2017

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Mobile data

Smartphone tariffs: Germany, US charge 'exorbitant' prices

Although unlimited access to mobile data has increased overall worldwide, some countries still charge a bundle. A new report shows prices in the United States, Canada and Germany are among the highest.

Customers in Germany, the US, Canada, Japan and South Korea still pay through the nose for their gigabytes — despite the fact that overall prices fell in nearly all 41 countries considered in the latest Digital Fuel Monitor, a bi-annual publication on mobile data pricing from Finnish management consultancy Rewheel.

Unlimited or 100GB mobile data plans are now available in 23 of the 41 countries, the consultancy said in a study released Friday.

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Of the major global economies, Canada performed the worst. The report shows that for €30 (US$35.70) a month or less, you get just 2 gigabytes (GB) on average on a smartphone tariff.

Canadian users thus pay 41 times more for mobile data than, for example, users in Finland.

In the US, it is 10GB, in Germany it stands slightly higher at 15GB. In Germany, which the report said is one of the countries charging "exorbitant" prices, the only true flat-rate plan available on the market costs just under €200. Many other tariffs include a reduction in speed after a certain amount of data has been used.

Lack of competition

One reason for the high prices is a lack of competition, although in Germany, new providers are just starting to drive prices down and GB allowances up, Torsten Gerpott, a telecoms expert at the University Duisburg-Essen, told German public broadcaster ARD.

Providers often cite the high prices they paid for the mobile frequency licenses as well topographical challenges as reasons for expensive tariffs. "The costs for the licenses have long been written off," Gerpott said, adding that providers do not want to admit that they are simply making huge profits.

Operators also benefit from the fact that consumers tend to be sluggish when it comes to changing providers, as the switch often involves a new SIM card and phone number.