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Summary:

The number of Opera users has doubled since September 2009, and the company served up 36.9 billion web pages last month, a monthly increase of 9 percent. Opera says it saves $27.4B in data costs with its compression technology, but those numbers just don’t add up.

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The number of handset owners turning to Opera for their browsing needs has doubled since September 2009, and the company served up 36.9 billion web pages last month, an increase of 9 percent over the prior month. Clearly, more consumers are using Opera to gain a faster browsing experience while using less bandwidth; Opera says it compresses web pages up to 90 percent before serving them to a handset. By squeezing down the web, Opera today says it saves consumers $27.4 billion in annual data costs. But the numbers don’t add up.

To figure out the data plan cost savings, Opera took the “lowest price-per-MB plan in each of the top 10 countries and created a global average.” That’s a reasonable proxy method: Look at the data costs in a sample population that represents the largest numbers of users to create an average cost per megabyte of data.

Opera knows how much bandwidth it saves through its compression technology and how many pages it served, so the cost of that bandwidth savings is really the only variable. On the surface then, it sounds like a reasonable approach to calculate the annual data cost savings.

Then I looked at the top 10 countries Opera lists as places with the most users of its browser and see that the U.S. is number eight on the list. Given that I just wrote about how the current U.S. mobile broadband market is undergoing some upheaval with a multitude of new networks and plans, I wondered what figure Opera used for data costs in the U.S.

Opera lists the average cost for each of the top 10 countries right in the report, and the U.S. figures are drastically higher than any other country. More importantly, Opera figures the average cost-per-megabyte in the U.S. to be $2 and extrapolates that to a monthly savings of $141 for Opera users in the United States; an amount that’s three to 47 times higher than the savings in the other nine countries.

 

Source: Opera.com

 

So who’s paying $2 per megabyte in the U.S.? Expensive data plans for feature phones come to mind and indeed, such devices are the perfect target audience for an Opera browser, because Opera’s software excels at bringing a smartphone-like web experience to feature phones. Here’s the problem, though: Of the top 10 devices that use Opera in the U.S., seven of them are smartphones, says the Opera report. And how many smartphone users are paying $2 per megabyte for their data plans?

The iPhone is the most-used device for Opera in the U.S. (although I still question how many iPhone owners really use it). Until recently, iPhone owners paid $30 for 5 GB of data. But let’s look at the highest data plan option for the iPhone on a cost-per-megabyte basis. That would be AT&T’s new 200 MB plan at $15 per month, for example, working out to 7.5 cents per megabyte, or a small fraction of what Opera is using for its cost savings estimate. This plan has the highest cost for iPhone users because the next step up is 2 GB for $25 or a cost of 1.25 cent per megabyte — an even farther cry from Opera’s $2 figure. Opera’s cost estimates in the other nine countries are all under a dollar a megabyte, so the U.S. price is heavily skewing the potential cost savings upward.

Having used Opera Mini and Opera Mobile, I can vouch for the positive experience Opera browsers bring to mobile devices. In fact, I highly recommend any mobile device owner to take Opera for a spin. But spinning numbers that don’t make sense to promote a product does a disservice to the product, and the user base for it. Opera can and does save on mobile broadband data use and yes, it’s difficult to quantify that savings to operators and consumers. Due to the complexity of the broadband market in various countries, maybe Opera should re-think its approach to show cost savings at a global level.

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  1. “So who’s paying $2 per megabyte in the U.S.?”

    If you don’t know, why are you making claims about it?

    “although I still question how many iPhone owners really use it”

    First you are saying that Opera has a lot of them, thus somehow disproving their numbers, and then you are saying that you don’t think they do?

    Contradiction much?

    “maybe Opera should re-think its approach to show cost savings at a global level”

    Maybe not. Maybe you are misrepresenting them again, just like you desperately want Opera Mini to be unpopular on the iPhone for some reason.

    Oh well.

    1. I wasn’t asking the question because I don’t know: my point is – very few data customers in the U.S. pay that high a rate and yet it’s central to the Opera study. Put another way: so you think that Opera’s data on the U.S. cost savings is accurate? You seem to be suggesting so.

      And I have no reason to want Opera be unpopular on the iPhone or any other device. As noted in the post: “Having used Opera Mini and Opera Mobile, I can vouch for the positive experience Opera browsers bring to mobile devices. In fact, I highly recommend any mobile device owner to take Opera for a spin.”

      1. No, U.S. data plans are not central to the Opera study. In fact, the U.S. is just one of many other countries.

        Narrowly focusing on the US to desperately try to find errors is quite silly.

        How do you know what people are paying in the U.S. anyway? Do you know what data plans most of Opera’s users are on?

      2. Actually I think Opera miscalculated in the region of 6 bln USD in savings (my estimated US userbase of 4 mln users with 5 USD monthly savings instead of Opera’s 141 USD). But even then the total worldwide savings of 20 bln USD is still impressive.

  2. what we do not haver in the US that these other countries have is cheap pay-as-you-go data. the only way to get cheap data is too buy a bucket.

    in many other countries you only pay for what you actually use.

  3. Since I helped work on the report, I think I should give some insight into the numbers and how we selected them.

    The U.S. was hands down the toughest country to figure out exactly what number to use. There was a robust internal debate regarding the pricing with respect to tiered plans. However, with tiered plans, Opera Mini will only save money if someone goes over their allotment. The real benefit of Opera Mini under those circumstances is more page loads for the plan’s allowed data.

    We decided to use pay-as-you-go rates for several reasons. First, it is the clearest in terms of pay-per-MB pricing when considering the issue with tiered plans. Second, it is the same price for the two largest U.S. carriers, while other operators use different brands for their pay-as-you-go service, which adds some additional complexity. Third, while smartphones dominate the top 10 handsets in the U.S., the so-called Long Tail has a notable impact. Approximately 62% of our U.S. users use something other than an Apple or RIM or Android smartphone.

    Globally, of course, these numbers are closer to the reality. Metered plans are more prevalent in many countries, including most in the top 10 countries.

    1. Thanks for chiming in with information on the approach, Thomas. And I recognize the challenge with so many plans and carriers that could be used for such studies. But I still think the U.S. pricing skews the overall savings by quite a bit.

      I was just looking at Verizon’s and AT&T’s pay-per-MB pricing. For AT&T’s prepaid service, $20 buys 100 MB or 20 cents per MB. Prepaid is 200 MB for $15 or 2GB for $25 as I noted in the post.

      For either prepaid or post paid, Verizon offers a high priced data plan at 25 MB for $10, but unlimited plans are $30 – even on the lower capacity plan, overages are just 20 cents per MB. Again, the $2 per MB used in the Opera study just seems to be an outlier to me.

      I’m not saying Opera’s data compression is bad or doesn’t save money. In fact, I said the opposite in the post. But there seems to be some inflated numbers, which are central to the theme of this month’s report and press release. Regardless, I appreciate your taking the time to respond!

      1. i think the real point here is that in many countries people do not sign up for any type of monthly data plan at all. they just pay what in the US would be the ‘overage rate’ per KB or MB and pay for exactly what they use. this rate is completely outrageous in the US. Kevin, the examples you give are for ‘monthly buckets’ not ‘pay as you go’ even if they are offered on so called ‘prepaid’ services.

  4. I am having trouble following the math. The Opera report
    http://www.opera.com/smw/2010/09/
    says for the US, 8 MB data per user, $2 per MB, leads to a savings of $141 per month. Isn’t 8*$2=$16? How do they get to $141?

    1. Hi Bill, Opera Mini compresses data worldwide by almost exactly 90%. So technically, users in the U.S. would use approximately 80 MB of uncompressed data. The cost savings would be the difference between the uncompressed cost of the data minus the compressed cost. The reason it is $141 instead of $144 is that we used a more exact data figure in the calculation (7.859 MB), whereas we round off the figure when we report data consumption.

  5. I know for a fact my plan is 1.99/MB through Verizon. It’s a family plan and we have 2 smartphones and 2 feature phones on the plan. I should tell my mom to download opera mini.

  6. Richard Watts Friday, October 29, 2010

    I wholeheartedly agree. While Opera Mini allows my Uncle to use his feature phone and check just about everything he needs to, without having to upgrade beyond a $5/month data plan, for the “mainstream” US market (Opera’s potential market, anyway) the savings per MB doesn’t reflect the pay-per KB cost of AT&T OR T-Mobile, if you DON’T have a data plan… The carriers most likely to have feature phones that allow the end-user to install java apps. The only networks this WOULD save the end-user $ on would be networks that only allow BREW applications purchased from the network’s own app database, which it tightly controls, and why would they want to give users a free browser that cuts their data usage by 50%? They wouldn’t, unless there was a serious consumer demand for it… Opera, follow Skyfire’s lead, figure out a way around apple’s “hell no, no flash on iphone, ever” by reencoding content in html5, or better yet, make it available on feature phones, and THEN you’ll be able to make claims that you are saving consumers millions of dollars… And be telling the truth this time!

    1. “Opera, follow Skyfire’s lead, figure out a way around apple’s “hell no, no flash on iphone, ever” by reencoding content in html5, or better yet, make it available on feature phones, and THEN you’ll be able to make claims that you are saving consumers millions of dollars… And be telling the truth this time!”

      You are obviously rather ignorant.

      Skyfire, apart from being spyware, does little else than transcoding video.

      They have no real business model.

      Skyfire is NOT reencoding ANYTHING in HTML5. They are lying, trying to use buzzwords to pretend that they are doing good things.

      Opera is being more truthful than Spyfire.

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