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April 12, 2007
Those Roaming Charges
Other people understand the telecoms markets much better than I do but is this a reasonable view? Certainly seems that way to me:
But there's something else a bit murky here. The European Commission is focusing soley on the roaming charges. Just because the companies might be making large profits on that narrowly defined section of their business doesn't mean they're pocketing it and walking off. All those free handsets, call minutes and texts that the big telecoms companies offer (but not, alas, Jersey Telecoms) have to be paid for somehow.
Could it be that these roaming charges (paid by those well-off enough to travel) are subsidising communication for everyone, benefiting, in particular, the less well off?
I'm not sure making the poor pay more was really part of the plan here.
April 12, 2007 in European Union | Permalink
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Comments
The roaming market isn't working: pricing is opaque and choice is severely constrained, hence the need to break up the cosy little cartel.
There aren't any cross-subsidies for "poor people" in any case: full-price unsubsidized handsets can be had for £30. Or are we saying that roamers are supposed to subsidize expensive bling phones for chavs now? That would be like defining poverty as being unable to afford all the movie and sports channels on Sky. Oh wait.. that's exactly what Polly says.
Posted by: Kay Tie | Apr 12, 2007 8:26:32 PM
Good thing I have no mobile.
Posted by: jameshigham | Apr 12, 2007 9:36:02 PM
Who benefits from this regulation. Well people that regularly have to travel between several countries, in order to communte between Brussels and Strasbourg one week in three for example. Hmmm, I wonder why all the Eurocrats seem to think this is of such importance when it will actually impact so few.
Posted by: chris strange | Apr 12, 2007 10:43:11 PM
"Who benefits from this regulation."
Everyone who travels to another EU country on holiday.
Quite a few of us. You just stay at home and support the cosy cartel while the rest of us are enjoying ourselves.
Posted by: Kay Tie | Apr 13, 2007 1:03:23 AM
"... those well off enough to travel..."
Hmmm... I'm sure I've heard that line of argument before...
Is Tim Yeo blogging from Jersey now?
Posted by: Machiavelli's Understudy | Apr 13, 2007 2:27:45 AM
I have no more idea than Tim about roaming charges. I do know that I have a phone on the Orange network in the UK. When I travel to Spain, my phone always tries to connect to Orange in Spain, despite the fact that other networks in Spain provide a better signal. And I still have to pay roaming charges.
Posted by: far2old4this | Apr 13, 2007 7:06:32 AM
As usual, the best option appears to be that if you don't like the service that your provider offers, change to another, and tell them why you're changing. If sufficient people do it, they'll get the message.
Posted by: Ian Bennett | Apr 13, 2007 7:56:21 AM
Speaking as someone who has made their living advising on and explaining roaming charges -
1. Expenditure on roaming charges is usually only a very small fraction of overall usage charges, so there would seem to be little scope for scaremongering over the loss of the handset subsidy or increased UK to UK call costs;
2. My employer provided a number of discount schemes for usage from the UK to overseas and vice versa; don't know about the others
3. The reason roaming charges are there is because in order for your call to be carried in another country your supplier has to reach an agreement with one of that country's operators for the use of its frequencies - while you're making a roaming call one of its local customers might not be able to connect, so they have to be compensated for that;
4. I am unaware of any operator who does not advertise the nature of their roaming charges in the public domain, usually through their website- nobody buys a contract mobile with a gun at their head;
5. Given these variables, the Parliament's decision is inexplicable.
Posted by: Martin | Apr 13, 2007 8:28:58 AM
I'm not arguing that the current market conditions are either good, bad, right or wrong. Just that with an artificial control on price in one section of their business (especially if it causes them to operate it at a loss; see the industry's claims and Martin's point three) prices may rise (or subsidies fall) in other sections.
The EU Commission is presenting itself as the "Consumer's Champion", but I don't think they've really thought the implications of this through. I suspect there may well be something to Chris Strange's speculation.
Posted by: Charles Robertson | Apr 13, 2007 9:11:53 AM
Am I missing something, a good way to avoid any roaming charges is to buy a local SIM and scratch card(s) at your destination. The costs are fixed and no surprises when one gets the bill next month. Repeat visits can more than make up the relatively low cost of the SIM.
If the 'hassle' over buying a SIM is too much, aren't individuals choosing to value the convienience of roaming over the price itself?
Posted by: EU Rota | Apr 13, 2007 9:52:17 AM
If international roaming where an important part of peoples phone habits it would already be part of the competition between the networks that has brough all the other charges so low.
The people in the UK have an average of 28 days holiday. Only 27% of holidays are taken abroad. So foreign holidays account for a whopping 2% of the possible time you can spend on a mobile phone. Unless of course you are a Eurocrat and have to travel between Brussels and Strasbourg twice every single month.
On the otherhand the costs will be recouped elsewhere, such as the other 98% of the time that you can use the phone.
Posted by: chris strange | Apr 13, 2007 8:24:02 PM
