For a telecoms operator, we applied the OECD pricing methodology to a data set of domestic mobile prices to enable comparisons with prices in the European Union

The problem

• A telecoms operator wanted to compare domestic mobile prices against those in the European Commission’s (EC’s) latest report (‘Mobile broadband prices in Europe 2019’). The aim was to present the findings to the national regulator as part of a recurring exercise to determine how national telecoms pricing compares to pricing in the European Union

The solution

• We studied the method used by the EC for standardising and comparing prices (the ‘OECD methodology’) and implemented it using pricing data supplied by our client to build the domestic data set
  • this data was recorded in early 2019 to better match with the EC’s report
• The output was a comparison of the least expensive offers per country, split by usage profile (17 in total for each country)
  • this meant calculating the lowest-cost way of achieving sufficient amounts of each component of the usage profile (i.e. mobile data, minutes, SMS) for the country we were studying. This involved manually running through multiple combinations of tariffs and extras in order to find the lowest-cost way of filling any given basket
  • in order to check that we were correctly implementing the methodology (in the absence of a clearly defined rulebook with worked examples), we studied the results in the EC’s reports and back-calculated some results

Figure: Project stages

The result

• We published our results in both long- and short-form reports and actively assisted our client to interpret and understand the OECD methodology