AT&T should not expect too much with prepaid data, indicate European learnings

Implications: The wireless data market in European has not shown any significant revenues streams in the prepaid data market. Europe is more prepaid and more data oriented than the US. Learning from the European experience, AT&T should not be too optimistic about revenues in this market.

Analysis:  European wireless carriers have not been successful to date with data services in the consumer market. On average, voice represents about 80% of wireless operator revenues, text messages counts for 15%, the remainder of 5% being for other data services (picture messaging, downloading of games, music, browsing the web, access to news, weather, sport, adult content, etc.). A significant part of this data chunk is earned in the business segment and the high-end consumer postpaid (subscription) market. The data revenues in the prepaid market are very limited, even though in most European market more than 50% (up to 90% in Italy and Eastern Europe) of the market is prepaid.

Reasons are settings in handsets, capabilities of the handsets, high costs for end users and the fact that those costs are nontransparent. Flat fee propositions are only limited available for the prepaid market.

AT&T should be cautious with expecting revenues in prepaid data: the US market is more postpaid and less data minded than the European market.