Friday, November 11, 2005

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Tarifica Finds that Push-to-Talk is Not as Cost-effective as SMS

Orange pioneered Push-to-Talk in France in October 2004 followed by Bouygues Telecom that launched a similar offering in November of the same year. Push-to-Talk was initially targeted at business subscribers, whilst the latest campaign trend has included young people as part of a target group. Push-to-Talk is being marketed as an instant voice messaging service gratifying the need for instant communication amongst users. However, consumers have not yet embraced the service, and SMS still remains the most popular and cost-effective service for instant communication. Comparing Push-to-Talk with SMS offerings from Orange UK and Orange France sheds light on the price discrepancies subscribers can expect:

notes:

1) All prices shown above are expressed in € and exclude VAT.

2) Off-peak (21.30-08.00, mon-fri & all day on weekends) SMS price quoted.

3) SMS prices quoted are for standard SMS – Lower per message SMS prices can be obtained if a bundle is purchased.

An SMS on Orange France costs ten times more than a single Push-to-Talk call, while the per minute PTT charge on Orange UK is triple the operator’s SMS cost.

In an attempt to stimulate Push-to-Talk take-up, some European operators, such as Bouygues Telecom and T-Mobile (Germany), offer PTT in the form of promotional monthly bundles that include unlimited usage. Nevertheless, consumers still need to be educated on how to use Push-to-Talk, while user-friendliness is still an issue, as users need to keep the button on their handset pressed down for as long as the conversation lasts. Further to this, the limited choice of PTT-compatible handsets available constitutes an additional impediment for the service, as often subscribers tend to show a preference for specific handsets. The hot question that remains to be answered is whether operators will eventually manage to provide an incentive for subscribers to prefer Push-to-Talk over SMS for their instant communications.

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Located in London, Tarifica is a leading brand of Access Intelligence LLC, headquartered in Rockville, Md, USA. Established in 1976, Tarifica was the first consultancy to track telecommunications tariffs, and offers a unique repertoire of tariff related products covering fixed and mobile services globally.

Access Intelligence (www.accessintel.com) is a b-to-b media and information company headquartered in Rockville, MD, serving the telecommunications, chemical, defence, satellite, aviation, cable, media and public relations markets. The Telecommunications Advisory Group includes: TelecomWeb, the telecom industry destination for comprehensive global business intelligence, which recently launched a daily news service; market intelligence provider InfoTech; tariff consultancy Tarifica; subscription news services such as Inside Digital TV and Wireless Business Forecast; and the Web-based product database TelecomTactics.

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