Price of mobile services here low but perceptions high

Studies conducted by LIRNEeasia, a regional ICT policy and regulation capacity-building organization, have shown that Sri Lanka is among the four countries that offer the lowest mobile services in the South Asian region.

In the study of low users, or low income users, Sri Lanka came in fourth, with the low user spending an average of only US$3.83 per month on their mobile if they are on a pre-paid package. India came in second with the low user spending US$3.72 and Pakistan was second with US$3.34. Bangladesh offered the cheapest mobile services at US$2.46 per month.

For post paid customers, the lowest low-use basket was in Bangladesh at US$7.14. India, Pakistan and Sri Lanka followed.
When converted into purchasing power parity, Pakistan offers the cheapest services for prepaid users followed by Bangladesh, Sri Lanka and India.

The LIRNE study compared the mobile prices using price baskets including usage charges (voice as well as SMS), line rental, connection charges depreciated over three years and applicable taxes.

In a study conducted by Nokia International, the hugely popular mobile handset provider, Sri Lanka has also been found to have the Total Cost of Ownership (TCO) among 80 other emerging markets.

According to the Nokia survey, the TCO includes the service fee, taxes and mobile handset price. The hand-set considered was the lowest-priced Nokia entry-level handset, the service fee was based on Organization for Economic Co-operation and Development (OECD) low cost basket of prepaid mobile subscription services and taxation included all direct taxes applicable to mobile services and handsets.

The two studies using different methodologies, confirm that using a mobile in South Asia is relatively low for the poor of the South Asian region.

“The relative positions of Bangladesh, India, Pakistan and Sri Lanka vary depending on assumptions and exchange rates used, but overall the fact remains that these four countries offer the lowest mobile prices in the world today,” said Dr. Rohan Samarajiwa, Executive Director of LIRNEasia.

The Nokia study also says that 80% of future mobile growth is to come from the Asia, Latin America, Africa and Eastern Europe and that too mainly from their lower-end consumers.