The last thing you want when you get back from a holiday abroad is a £200 hike on your cell phone bill, brought about by what are seemingly invisible roaming charges, and usually because the office phoned you, not the other way around. So the battle between the GSMA, representing cellular operators everywhere, and the European …
Bastards all !
Roaming charges almost cancel each other out. Its just a way to fleece consumers and thats why they protect this revenue by blaming the regulators. Whats has these charges got to do with investments?
Just see the example of India, which has the lowest call charegs in the world. (Vodafone and others exist there too- happily an despite the regulations) . No one's complaining about investment throttling there.
EVen Paris can spot a Ripoff - always.
At least for me, the story checks out. I actively avoid using my cellphone as much as possible when I'm abroad, exactly because I don't know how much I'm going to spend, and I know it's going to be exhorbitant anyway. Same reason for which I don't use WAP, for that matter. Bring on the caps.
Lies, damn lies......
I assume you mean mobile phones where you wrote "cell phones" given that we are not Americans.
Having worked for ten years in the mobile sector I have noticed that most companies in the sector are very immature and poorly organised. They're still living in the early years when people were entering the market without any real effort from the phone companies. They are very much at the beck and call of the latest brain child of the marketing department.
They pee money up the wall like it's going out of fashion. I saw one replace a perfectly good billing system for millions of Euros only to replace it with something that was ten times more expensive to run and less flexible. To top it all that project then won an internal award!
One place I worked had no real way of matching up money going out of their accounts to find out if it was a legitimate refund or not.
Roaming charges are easy to collect and the systems to do that have been created long ago. They really don't need to take a big cut. On the other hand they like this cash cow because it means they don't have to grow up as a business and can continue to operate as if they were in an expanding market.
It's disgusting and I thought it had been banished?
Shaft them all I say
They should all get shafted(the cellcos). They should be brought down to offer a service at reasonable prices... I'm planing on visiting germany next month and am looking into getting either
data roaming(it'll be like 5day trip and there will be some wifi around(and am lucky enough to live in a lpace where unlimited means unlimited(though the speed is still in question but I'm not picky))) or getting a local sim for the time I'm there...
If only mobile operators would look not at what they charge others but at the balance at what they charge foreign roamers against what they recoup from they're own roamers. If charges for roaming only reflected the difference between these sums then they'd be lower. As it is, whilst some holiday destination countries do benefit overall most operators have a reasonably close balance between in and out roaming costs/charges across Europe and all these charges do is pad the balance sheet - they're not real profits just inflated turnover.
Sorry to be perdantic but....
should the the line that reads "£4 per megabyte" be "£4 per megabit"???
"...it is clear that the high level of uptake required to provide these services profitably across Europe won’t happen if regulators continue to distort the market by hiding prices."
It's all a big con. The infrastructure is there already in each country (or is going in for that country's indigenous use) and the gateways exist. The pipes between the networks cost the same whether there's 1 call a day or 10s of thousands, so the operators can either go for the mass market where the profit per call is less, or stay with their current business model where only businesses or the distracted dare the expense.
Of course high profit per call looks better to shareholders.
Mobe? Bloody MOBE!!!!
Where does one start?
"Europe’s mobile industry is in the midst of another major investment cycle to deploy new services, such as mobile broadband, video downloads, mobile television and mobile email..."
What is the point of providing these services if they are so expensive that nobody will use them? This is exactly the problem the Thieving Robbing Bastards ...errr ....sorry ...I mean the telcos have had with trying to sell music and picture messaging.
And the reason the caps on international roaming charges have not had a great deal of effect on the public's use of these services is that the capped prices are STILL too high!
Even 5p for a text is very expensive once you know that it costs the TRBs virtually nothing to handle them. The profit margin on a text message is phenomenal as highlighted by the recent comparison with getting data down from the HST.
Even if it were the case that the operators make no overall profit, it wouldn't change the case for reduced roaming charges.
They are gouging travellers (with roaming prices they hide) to keep local prices lower (which they publicize in advertising).
The worst case (for the consumer) is that local prices rise a little to compensate.
The mobile industry has always been addicted to obfuscation, and it makes no sense. People won't buy things if they can't understand the costs.
I finally took the smartphone plunge earlier this year with an 8Gb N95.
Over the following couple of months I got into the habit of using it for basic web use (news, weather, etc).
During my 2 week holiday in the south of France at the end of June I was billed almost £5 per Mb for my data usage.
For the cost of the data I used over 2 weeks I could have bought a portable TV and used that to get the info I wanted.
I don't feel sorry for the phone companies in any way.
They have continued to rip their and others customers off for WAY too long now. If the cost of handling that data was higher for the roamed network than the home network then I could understand the charges but it isn't and never has been.
So, I say "You go get 'em Mr Regulator and you regulate their asses into understanding that raping a customer is NOT the best way to make money, short term OR long term"
So what ?
LET THERE BE RUIN ! MAY THE FITTEST & ADAPTABLES SURVIVE.
The telcos bleat for sympathy against ruination. Always remember J.K. Galbraith's observation that during WW2 when in charge of US procurement he was constantly petitioned by captains of industry for increased prices, crying they would otherwise be ruined. He always said no, and they never were.
services to enhance Europeans' daily lives
Errr no, all I want is a phone that works when I'm out and about, yes you heard that right, just a damn PHONE!!
For browing I have my PC, for watching TV/films I have a 32 inch LCD and DVD player with an extremely comfortable chair and for music I have good speakers connected to my PC and a decent stereo system and an iPod for listening when I'm at work.
I DO NOT want to pay over the odds to carry around a mobile entertainment centre.
Understand your customers, they just want a MOBILE PHONE service!
Setting the record straight
ROCE is an appropriate measure of the mobile industry's profitability. As ROCE represents operating profit after tax divided by capital invested, it is an important metric for capital-intensive companies, or firms that require large up front investments to start producing goods. ROCE should always be higher than the rate at which the company derives its capital from lenders and shareholders (WACC), otherwise shareholders will see the value of their investment decline the more the company invests.
The GSMA response to the consultation on the voice roaming regulation highlighted that the typical private customer, going on holiday once a year, saves around 5 euros versus pre-regulation prices. Regular business travellers will, of course, make greater savings.
As hundreds of millions of Europeans use roaming services, their total savings do add up to a substantial loss of revenues and profit to the mobile industry.
Some operators, depending on their geography and market position, have a larger roaming business than others (up to 20% of the total business in the most extreme cases) and they have been disproportionately hit by the retail and wholesale price caps introduced by the European Commission.
The GSMA response highlights the best tariffs which are available in the market today for those who use voice, SMS or data roaming and makes clear that these are highly competitive and well below the shock outlier levels cited by the European Commission and others.
Competition is the way to deliver benefits to customers and create a healthy industry making fair returns on its still substantial investments.
Feeling sorry for David
I suppose that would be David Pringle, Media Relations at GSMA ?
Let's all agree with David that "Competition is the way to deliver benefits to customers and create a healthy industry making fair returns on its still substantial investments".
Sadly the mobile telcos were set up as national oligoplies, without any proper incentives for price competition. That's why they are able to indulge in egregious gouging, that's why all their customers hate them, and that's why the GSMA has to spout such kafkaesque nonsense.
We should feel sorry for David Pringle: he really has a crappy job. Still I guess at least he doen't pay his own mobile bill.
Hello David, have you got a good signal? right good.
Your members are developing services nobody wants to pay for.
The only way these services take off is when they are bundled and/or the price is lowered to a point where they operate at a loss.
GSM was of course a revolution compared to the dire ETACS system but you got to face it, 3G has flopped on the whole, they were stupid enough to hand over billions to the treasury, thats their lookout and they shouldn't be looking to customers to make up their losses via ridiculous roaming charges, termination fees or making veiled threats of charging customers for incoming calls.
I dont agree with a lot that the EU does but your members have been caught profiteering red handed, time to cut the prices.
Oh and by the way, if your members do start charging for incoming calls, the first thing I will do is ditch my mobile as I suspect a lot of others will too.
These profits are very real....
John Loader is a little wide of the mark These are real profits ok it's just that the real costs incurred by the cellcos are miniscule by comparison. The artificially high termination rates they cross-charge one another are recouped directly from the consumer with an added 'service charge' as gravy on top.
In most other spheres these businesses would be penalised for operating as a cartel. But as they can wheedle out of this definition rather easily they get away with it. Since roaming first came into being under the auspices of the GSMA they have protected this extortionate revenue stream and now someone is calling 'time'; a good thing too.
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