A new report
published by Quantum-Web, reveals the positive inverse
correlation between the number of available broadband
packages and decrease of broadband prices in Europe.
Overall, the report details the decrease of broadband
prices in Europe but draws attention to the diversity
of emerging and mature broadband markets in terms
of price of broadband packages stratified by speed.
The report
- European Broadband Pricing Report - is based on
extensive research conducted with 109 operators featured
across 36 European Countries and some 455 tariff packages,
and presents the most far-reaching report yet to address
broadband user pricing complemented by in depth country
specific data and analysis.
Uniquely, the
report provides a comparative cross-country analysis
of third quarter tariffs.
Coupled with a trend analysis for tariffs for first,
second and third quarter of this year. Both time series
and cross section analysis provide a glimpse of pricing
strategies of European service providers. Since the
beginning of 2004, the average monthly price for 512Kbps,
1Mbps and 2Mbps speeds dropped by 23%, 23% and 24%
respectively while the number of available packages
market rose by 74%, 40% and 34% for those speeds bands.
The Higher
Speed packages availability, 4Mbps and 8Mbps namely,
showed the same growth trend but prices dropped less
dramatically, leaving more room for price elasticity
for content providers.
The report
analyses 295, 350 and 455 price packages in Q1, Q2
and Q3 respectively.
In the cross
sectional analysis of packages, the weighted average
prices is estimated by
running the
Generalized Least Square which is therefore capable
of producing best linear unbiased estimators. Thus,
the European average prices represent a minimized
heteroscedasticity in national prices posted by outlier
packages in each country.
Price sampling
covers all available speeds offered by operators in
7 different categories
