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Prices to fall in growing 3G market

Orange launched its UK 3G data service in the UK last week, raising the prospect of price wars as operators battle for customers....

Orange launched its UK 3G data service in the UK last week, raising the prospect of price wars as operators battle for customers.

With T-Mobile and O2 planning to launch their respective 3G services later this year, 3G connectivity prices are set to tumble.

Vodafone was the first operator to launch its service this spring, offering 3G coverage to 55% of the population, mainly in big cities. Last week, Orange launched a much cheaper service to 65% of the population, mainly in major cities.

The entry-level price of the Orange service is £10 a month for up to 7Mbytes of data sent or received, rising to £75 a month for 1Gbyte of data. This compares to Vodafone's entry-level price of £11.75 for 5Mbytes and a top price of £100 for 500Mbytes of data.

Both firms are selling data cards that plug into laptops and which offer a connection speed of up to 384kbps.

Carrie Pawsey, wireless analyst at Ovum, expected the cost of 3G data services to fall over the next 12 months. "The operators are targeting business users aggressively. We will see prices driven down as more operators bring data services to market," she said.

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