Q&A: EE defends its 4G price hikes

25 Oct 2012
EE

We ask EE's chief marketing officer to justify the company's much-criticised 4G tariffs

EE's 4G tariffs, announced earlier this week, have provoked a furious reaction among PC Pro readers and the wider public.

The company's cheapest monthly tariff (with handset) starts at £36 per month and comes with a data cap of only 500MB - which a customer could exceed in just over five minutes if they downloaded data at the network's claimed speeds.

The move was largely derided on Twitter. One tweet, bizarrely favourited by the EE Twitter account, brutally states: "I hope @EE are not paying for sentiment analysis of their recent launch. I can tell them from free - terrible."

Pippa Dunn is the chief marketing officer for the network that currently has a monopoly on 4G services in Britain. We asked her to defend her company's pricing model.

Q. How can you justify the cost of your 4G tariffs?

A. We've looked at existing customer usage. At £36 per month on Orange, customers are using an average of 380MB per month. We thought we’d stick with £36 per month [for the base package], which is about £5 more than 3G. You're going to pay about £5 more for a similar amount of data.

It's interesting to note on that T-Mobile point that, on average, Full Monty customers use 1.5GB

Q. That's not true though, is it? You can't even get an unlimited package on EE. To get a package with an 8GB download package on EE costs £56 per month, which is £20 per month more than T-Mobile's (Full Monty) unlimited tariff, and that’s not even unlimited.

A. It’s a very different thing though. To coin a pun, it's like apples and oranges, it's not the same thing.

Q. What's the difference?

A. On EE you're going to get five times the speed, you're going to get a free film every single week with all the latest releases, you're going to get two-for-one cinema tickets, you're going to get clone phone, we're going to ensure that you don't get out of bundle on your data usage, so you're in control. No matter what you want to do, you can basically judge your usage.

It's interesting to note on that T-Mobile point that, on average, Full Monty customers use 1.5GB.

Q. Which would be £46 per month on EE?

A. Which would be £46 under what we do on EE, correct. So it's £10 more expensive at that level. But you're getting a whole load more value for it, you're getting five times the speed, and all those other additional benefits.

Q. But that's useless if you can get through that cap in five minutes. If you download at full speed on EE you'd be through that 500MB data cap in just over five-and-a-half minutes.

A. But the point is consumers aren't using it like that.

Q. Do your consumers not use BBC iPlayer, for example? That would be just over an hour of programming on that.

A. Yes, but don’t forget that we've also got unlimited Wi-Fi. Most customers when they get home will switch onto their home broadband.

The point is that we're trying to price this in a way where we can give the maximum amount of customers access to the 4G network at a reasonable price, and then the control mechanisms so they can choose what they want to spend.

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