What is the price of a phone
The price of telephone calls is becoming less important
Market opening ensures significant price reductions
With the opening of the telecommunications market in 1998, providers other than Deutsche Telekom were allowed to offer their own fixed-line tariffs for the first time. Competitors such as Tele2 or Mobilcom often undercut telecom minute prices by more than 50 percent.
Telekom customers had to memorize up to six different tariff times over many years. Both the call time and the destination of a phone call (inner-city, regional, nationwide) determined the price per minute. “Many new providers introduced prices that were valid around the clock - a novelty on the German telephone market. For the first time, customers had the opportunity to choose and compare prices, ”says Christian Schiele, Head of Telecommunications at Verivox.
The first community and flat rates
In 2000, Telekom reduced the price per minute to 18 pfennigs during the day; in 1998 it was 52 pfennigs. The competition reacted with new discount models. For example, free phone calls were possible among Mobilcom customers in the same city - the community tariff was born.
It was not until 2005 that Telekom presented its first telephone flat rate; the cheapest version cost 35.95 euros a month. The competition started in 2004 with flat rates: Arcor charged 19.95 euros for the first flat rate in the German landline network.
Similar development in mobile communications
The telephone flat rate has become the standard today - prices per minute in the fixed network are only relevant for call-by-call and international calls. A similar development has taken place in mobile communications: While a call minute could cost more than 1.80 marks at the end of the 1990s, prices fell drastically when the discounters entered the market in 2004 and fell by over 70 percent in the following years. Flat rate tariffs have long determined the mobile network tariff landscape. In the meantime, flat rates can even be used in other EU countries without additional costs.
The price per minute is no longer a yardstick
Despite the significantly lower price level, calls are being made less and less in traditional networks. Since 2007, the number of connection minutes in the fixed network has decreased by 37 percent, and since 2016 it has also fallen slightly in mobile communications for the first time (figures: VATM). Instead, more and more data-based services such as Skype or WhatsApp are being used to make phone calls.
Whether a tariff is expensive or cheap is only determined by the minute price for niche products. The yardstick for pricing today is data volume and internet speed - in both landline and cellular networks. Christian Schiele believes that the German market is still very capable of development: “The fact that data services are increasingly being used for communication is not reflected adequately in the tariff structure. Consumers are still being slowed down: real data flat rates without throttling are the absolute exception, as is the transfer of data and telephone budgets within a user group. The tariff structure should be revised from the ground up, it has long lagged behind social reality. "
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