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back to article Carriers, prepare to bleed: EU pops a cap on data roaming

The EU has renewed its caps on mobile roaming, this time including a cap on data roaming and a promise to let travellers choose their roaming carrier by 2014, all coming in from 1 July. At the end of next month anyone travelling in Europe will pay no more than 56 pence (€0.70) a megabyte for data, 23 pence (€0.29) per minute for …

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People always moan about "Europe" but they seem to do more for normal people than our own government does.

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Customers Prepare to Bleed

Yeah, like the Carriers are gonna pick up the tab for this aren't they. They aren't going to take up the price of EVERYTHING else to make sure they still get the same profits. Oh no, not at all.

Thanks EU! Something that affected a minority will now cost everyone equally :)

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Re: Customers Prepare to Bleed

That has got to be the most ridiculous illogical argument I have read all day.

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Anonymous Coward

Re: Customers Prepare to Bleed

They might bluster, whine and threaten, but just let them try jacking up UK call, data or line charges and see how far it gets them. Remember how popular 3G was until they stopped charging premium rates for walled gardens?

Mobile use is particularly price sensitive; if they put prices up, usage will just drop and leave the larger operators vulnerable to any operator that doesn't follow suit. Since Everything Everywhere are already set to roger us mercilessly for their LTE rollout, I doubt they'll have the stomach for an endless parade of "price rise" headlines.

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@ Shardik

You might like to look at the French "free" operator, and the effect it is having on traditional monopolies. Sure, the operator can jack up prices, but all it takes is somebody to stand up willing to take a lower profit, offer a better price, and customers will jump ship en masse. Just ask Orange France...

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Nev

Re: @ Shardik

Exactly.

With the ultra-low offers from the likes of Free and Prixtel the major players have (after first crying foul and trying to generate FUD/bad publicity) all now massively lowered their prices and are even offering all-you-can-eat international call from your mobile to try and compete.

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Re: Customers Prepare to Bleed

The infrastructure is already in place. They'll sell much more data at a lower price 1x£1000 < 1000X£2.

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Re: t ridiculous illogical argument

Ah, so you admit to economic illiteracy then. Because companies have to make a profit, and if they can't make them from those charges, they'll have to getting them from elsewhere.

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Re: infrastructure is already in place

Um, "in place" is not necessarily equal to "is paid for." Thieve from the guys who paid for it under the guise of "fairness" and nobody will pay for it next time around.

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WTF?

Text prices

7p per text... that's a lot less than most PAYG plans' charge for sending a domestic text. Will they have to come down also?

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Re: Text prices

No, they'll go up to compensate.

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Re: Text prices

With rates getting lower you could be better off using a foreign PAYG mobile than a domestic one!

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During 3 full days in France this weekend...

...I received five SMS messages from my phone operator telling me their roaming rates. Grr.

> Yeah, like the Carriers are gonna pick up the tab for this aren't they

What cost? They have already built their infrastructure, and charging thousands per gigabyte is just taking the piss. If it costs them orders of magnitude more to supply data to someone on another network, they are doing something wrong.

If you want to talk about costs, look at the history of the UK 3G spectrum auction... the UK gov brought in games theory professors to maximise the governments revenue from the auction to carriers... which seems a bit shitty when UK citizens would be footing the bill.

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Anonymous Coward

Re: During 3 full days in France this weekend...

> They have already built their infrastructure,

And they are still paying for their infrastructure and for the 3G spectrum auction.

The damage done to the UK telecoms industry by that auction was phenomenal. Over 30,000 UK jobs were lost as a result. It still hasn't recovered over a decade later.

Thank you Mr Brown.

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Re: During 3 full days in France this weekend...

1) Nobody was forced to bid

2) Damage was limited as the costs incurred could and were offset against tax

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Anonymous Coward

Re: During 3 full days in France this weekend...

1) Yes they were. In an evolving technology, you need to be a player.

2) There are a few problems with this. The first is that you have to make a profit in order to offset costs against tax. The auction put the entire telecoms sector into recession - no profits to offset against. The second is that you only get to offset certain costs against tax. For example, a company car will depreciate and you can offset the amount it depreciates against tax. A building on the other hand will not depreciate so you can not offset the cost against tax. The same is true of the spectrum they bought. They can not offset the cost against tax. They can offset the interest payments on the loans, but not the actual cost. If they could have resold the spectrum (which they were not allowed to do) they could have offset the difference against tax. Finally, the auction was a revenue raising exercise so if the companies involved could have simply reclaimed the cost through tax offsets then no revenue would have been generated.

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Anonymous Coward

Re: During 3 full days in France this weekend...

Just expand Charlie's words slightly to what I'm sure he meant: "nobody was forced to bid amounts that were obviously cluelessly over the top and a route to disaster".

Do the sums.

Assume a number of 3G punters.

Assume a payback time.

Assume an annual revenue per user.

There's the ABSOLUTE MAXIMUM you can afford to bid, because it doesn't include infrastructure costs, dividends, interest, tax, etc.

Several hundreds pounds per year ARPU was what they needed to pay back their bids.

It was OBVIOUS from day one that the networks had been on the silly water; I even sat next to a marketing type in Valbonne while 3GSM was on not far away, moaned that us techies might be good at arithmetic but we couldn't see the upside. Well, I think the evidence doesn't favour the marketing side of the story.

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Still stupidly pricey...

...more pricey than getting an el cheapo throwaway SIM from the country you're going to and using that for the duration.

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Happy

Re: Still stupidly pricey...

Have you tried that in France?

I gave up after standing in an SFR shop for 15 minutes. They really don't want to sell you a SIM!

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Anonymous Coward

Re: Still stupidly pricey...

"Have you tried that in France?"

Try Belgium if you want to make yourself really miserable.

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WTF?

Re: Still stupidly pricey...

There's more than just SFR you know. A Brit friend of mine, barely speaks any French, picked up a Virgin Mobile SIM from a boutique in a train station. Took around five minutes from "I'll have that" to texting me.

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Anonymous Coward

Try doing that in Italy

Here you need a local tax id to buy a SIM. Officially to fight crime, in practice just to mess things up for consumers.

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Re: Try doing that in Italy

you can buy one before you go out. There are loads of tourist type sims. You can even get true european roaming sims if you like - all pre pay. I have a spanish "tourist" sim. It works out much cheaper than an internet cafe when I tether too.

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Re: Still stupidly pricey...

Stick one in your basket at a supermarket.

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Joke

Yay!

This has brought the cost of browsing abroad down to a scarcely believable £570/GB!

How can they do it so cheaply?? Surely they will all be bust by being so generous?

Time to catch the Eurostar so I can download some music before they change this bargain rate, huzzah!

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Devil

Re: Yay!

although from 2014 that will be £163.84 per GB. Still massive but a substantial improvement over the £1310.72 per GB that Three currently charge for data roaming in France.

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Devil

Re: Yay!

Not to mention the ridiculous £3072 per GB for data roaming in the USA or if you fancy the Caribbean how about £6144 per GB in St Lucia? I wonder how much it would cost to daisy-chain a bunch of WIFI routers across the Atlantic? :D

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Anonymous Coward

3G auction crap

The 3G auction was 12 years ago and raised £35B, that's £1.85B per year, while the telco's receive an extra £5B a year from customers being on the wrong tariff.

Stop buying into the telco's propaganda!

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Anonymous Coward

Re: 3G auction crap

BT share price before the auction - £9.50

BT share price today. £2.13

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Re: 3G auction crap

yes because BT are the most astute company in the world.

By your rationale Three wont be making any money.

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Re: 3G auction crap

Till BT gets rid of its Nationalised mentality and its dream of restoring us all to large black phones with party lines, they will continue to bleed customers and share price.

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Anonymous Coward

Re: Danny and Andy

Prior to the auction BT was one of the leading telecoms companies in the world. It spent huge amounts of money in research and development and it was a major exporter of this technology to other countries. It was also spending large amounts of money in upgrading its ageing telecoms infrastructure.

After the auction it had to all but shut down its research and development, and it had to slow down its upgrade plan to a crawl. It is now a shadow of its former self.

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Re: 3G auction crap

WTF has BT got to do with 3G? They sold their interest when they sold Cellnet. If they're stupid enough to have taken a loss during the sale then thats their own stupidity. They're out of the game so none of this EU regulation has diddly squat to do with BT.

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Re: Danny and Andy

What? And you're blaming that on the 3G licence auction price? Maybe in some parallel universe but not this one. "...upgrading its ageing telecoms infrastructure..." to what exactly? Lets have a look. Ah, that must be all that copper that is still being deployed everywhere - much to the Pikey's delight.

Its R&D spend in places like Martlesham Heath achieved some successes but squillions of turkeys. Their whole attitude to the changing world was set in the days of The Post Office Telecommunications still, PTT mentality and Spanish working practises drove BT to where they are today. I recall a presentation at Martlesham where BT stated that within a few years that it would "own" the Internet in its entirety. The deathly silence that greeted that statement said it all - they clearly had no idea at all.

Then they outsourced their IT to India and that pretty much ruined the plot entirely. Working with them today, having to deal with their bureaucracy layers and off-shore ineptitude tells all.

Its got sod all to do with the cost of 3G licences, BT have been their own ruination, and continue to be. If they had true competition for cable in the ground they'd have gone bust years ago.

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Go

About time

I recall reading an interview with someone from Orange pre the nothing nowhere merger who said it cost around €0.04 to deliver a MB of data to a phone and do all the billing etc, pay for the infrastructure yet at the same time Orange where charging £3 per Mb!

As a former Orange premier customer I was allowed to buy 200 MB data bundles for £90 bringing it down to 45p per MB so still a whooping profit for Orange.

Ironically after orange pissed me off and I left them and went to Vodafone, the euro traveller deal means I havent spent anywhere near as much in data (or anything else) in the last year.

Making data cheaper overseas means more people will use it and the carriers will probably make more money tapping into a market that currently kills data at the airport before it travels.

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How about the rest of the world?

I'm currently roaming in the US with my UK T-mobile phone.

My phone has selected T-mobile US as the network.

Calls still cost me £1.20 a minute to make or receive. Yikes!

I know this is less of a concern for the EU but they could still regulate EU networks somehow.

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Anonymous Coward

No sympathy

The sick thing is that the bigger MNOs already have presence in most of Europe, yet as a customer you're still paying a hefty premium for daring to go outside one's borders. Had they simply put, say, a cent a minute on top for the trouble in the cases where roaming was easily doable, they would've gotten away with higher prices where it wasn't. Now, they got capped. Since the actual caps aren't that strict, they probably still figure a win while at the same time kicking and screaming all the way for public consumption, of course. Meaning that something is off with this competition in a free market idea. There somehow isn't enough market pressure to keep a lid on the margins. I don't suppose there's an economist around that could shed some light on this?

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Re: No sympathy

I'm no economist but I'm guessing it has to do with roaming being a relatively niche concern for the average mobile telephony punter, so it isn't really used as a comparison factor when comparing contracts.

Also they make it as difficult as humanly possible to compare different operators' tariffs. What do you think those "roaming bundles" are for? To make it cheaper for you? Haha - no, they're to bamboozle punters with multiple pricing tiers so they can't make an informed decision based on price.

Lastly there is the relatively large fact that contracts are commonly a whopping two years long now, which means operators can tie you down if you do make a mistake when first choosing a contract.

There may be competition in the mobile telephony market in certain areas, but in most areas the operators seem to act like a oligopoly.

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Gimp

Re: No sympathy

No need to be an economist. What free market? Government controls and sells the spectrum. Government controls and regulates how you make the phones. Government controls and sets the prices. Government issues patents and copyrights that grant the legal monopolies on new ideas and their implementation.

If you haven't got the money to bribe, I mean lobby the government government you won't survive in the highly regulated environment.

Now some of those things in small doses are good. But when the government effectively uses them to just shake down most of its citizens and blame somebody else, it is a whole different story.

Gimp because that's pretty much what the phone companies are in this case, even if they have a lot of money in the bank.

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Anonymous Coward

So only costs £2,000 to watch a DVD on your phone abroad now then

assuming 4GB

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Mushroom

tosspots...

and they wonder why everybody wants to use free wi-fi points and skype...

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How does this tally with T-Mobile denying roaming data in the EU, unless you pre-buy a bundle - minimum size 10MB I think? I suppose if the actual per Mb price doesn't exceed the regulated rate it's within the regulations.

I asked repeatedly for bill-me-as-I-roam per KB pricing but they said buy a bundle or get nowt. I only wanted a few KB for a quick SSH connection!

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The bundle works well - as it prevents accidental downloading of £40 of stuff...

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T-Mobile

Got to agree. I like the idea that my phone can't run up the bill in the background unless I actively buy some more time.

I paid £5 for 20MB last time I went to France - that's 25p/MB. I had to buy another 20MB during the week and only used half of it, but even so, that still worked out cheaper per MB actually used than the proposed cap.

Anyway, the smallest T-Mobile bundle is £1 for 3MB in one day - sounds ideal for a quick bit fo work over an SSH connection, and only 33.3p/MB.

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Anonymous Coward

Locsl sim

Orange Romania - cost of Sim 10 euros, provides 7 euro credit which gives 1000 minutes local calls (landlines and mobile, 70 mins international calls, 1500 texts and 100 mb data.

Send a few texts to your contacts saying, I'm on holiday, txt me on this number xxxxxx. Bargain

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Anonymous Coward

Re: Locsl sim

Or alternatively you could just turn your phone off and not get nagged about usual day to day stuff whilst on holiday...

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Unhappy

Re: whilst on holiday

Unless of course you're traveling on business, in which case you're still on the leash.

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Still not good enough

VNetworks are operating a scam when it comes to roaming charges. Voice and especially data should be a lot lower.

Networks should be obliged to nominate at least one national provider in every other EU country and provide rates which are within 20% of their home rates. For the rest roaming should be a nominal fixed charge.

Given that Vodafone, O2 / Telefonica, T-Mobile all have an international presence this really should not be hard.

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@DrXym

Hey, if you think you could make money at those rates, get a bank loan, start the company and start raking in the cash.

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