So, 3’s recently announced mobile internet tie up with Google and Skype is being mooted as a partnership that will change the mobile internet as we know it, with the ability to make free international calls and accessing your home PC or television from your handset.
But is this latest announcement just a case of 3 once again having eyes bigger than its belly and biting off more than it can chew?
3 stormed into the UK mobile market five years ago with amazingly low cost, high-usage tariffs and the promise of video calls, e-mails and high quality internet. But the reality has been somewhat different.
For instance, 3’s video calling service is still not fully accessible to all customers and remains at a premium price for those who can get it. Wouldn’t it make more sense to try to amend the current problems with this service, rather than just move onto something new?
3 has also recently announced that it will open 120 new stores before Christmas to add to its current total of 20 stores. This in itself seems like a mammoth task, without the added headache of launching a brand new service also within the same time frame.
Another fact that 3 seems to have overlooked is that about 95 per cent of mobile phone revenue is generated from voice calls and text messages. As a result, by providing free calls through Skype both nationally and internationally, surely 3 are potentially cutting off their main revenue source?
3 MUST get this service launch right, otherwise they’ll face yet another backlash from consumers, just like they did when they failed to deliver on their previous promises. If it goes wrong, 3’s customer retention department will have to work harder than ever to keep unhappy customers tied to the network this time around.
All things considered, this launch is either a very bold or very stupid move for a company that has ploughed £19bn of investment into its European division, but is yet to show a profit – 3 recorded losses of £815m in the first half of this year alone.
And if you’re still just a little bit excited about 3’s new service - read the small print. The service will only be initially available on two handsets and has a ‘fair usage’ policy attached to it. This may result in customers being stung by hidden charges once they exceed the ‘fair usage’ amount. Perhaps this is where 3 will generate that much needed revenue…?
Oh my God. You just rained on my parade. I had fallen for 3's marketing hype and was planning my Christmas around having hours of fun phoning my aunt in Auckland, while watching the Queen's speech, as I entertained my pals down the pub with my superb pub-quiz skills by virtue of some crafty Googling on my mobile under the table. The thought of being charged extra just for making creative use of my new found bandwidth leaves me distinctively underwelmed. Oh well, it serves me right for believing that a Chinaman comes bearing gifts at this time of year.
Posted by: Ken Young | 30 November 2006 at 00:53