Ian White argues that the large amounts consumers are charged for overseas data usage could ultimately hurt operators
At a recent dinner party one of the guests found out I was a writer who covered the mobile telecoms sector.
“Why,” he asked, “are mobile phone companies such unprincipled rip-off merchants?” (Actually he used slightly different words but this is a family newspaper.)
“Have you got a spare six hours?” I replied.
Turns out his rage against the operators’ machine was connected with a Christmas holiday to the Caribbean.
He had an iPhone 4 on Vodafone and knew that using it for emails and internet while abroad could lead to heavy charges.
He had arrived at his destination jet-lagged and exhausted after a six-hour delay. Thus, he’d forgotten to flick the data-roaming switch on his iPhone to ‘off’ until the next morning.
Bill shock
It remained firmly in the ‘off’ position until he returned to the UK. During his stay he only connected via the hotel Wi-Fi.
He was mortified to find a 65 data-roaming charge on his next Vodafone bill.
I explained to him that as long as the iPhone was switched on and his email settings were set to ‘auto’, the phone would poll his email account every 15 minutes or so to pick up new messages.
Because of the time difference, he was asleep when it was late morning in the UK, peak time for his email inbox to receive messages – and all being collected by his iPhone over a Caribbean network.
This is one subscriber who has now vowed to leave his iPhone at home and buy a local SIM-card for an old unlocked Nokia when he travels.
That means Vodafone gets 100 per cent of nothing, instead of 50 per cent of something.
How many thousands of other customers must have had a similar experience of bill shock?
And how can they be expected to think it is THEIR fault? Or know why the charges are so high? How is a weary traveller expected to know if their phone is connected via Wi-Fi or 3G?
The cost to a local network to ping out a megabyte of data is the same, whether it is going to the device of a tourist or a local resident. There can be no justification for an operator charging its customer up to 100 times the local cost of the voice/data call.
Networks have defended their roaming charges on the basis that the technology required to administrate international cross-network and cross-country billing is complex and expensive.
Yet newspapers and TV consumer-protection programmes regularly feature instances of horrific ‘bill shock’ – the university student who ran up a bill of almost 8,000 using Skype over his Orange dongle in France; the lawyer charged 4,900 by Vodafone for accessing iPlayer abroad; another Vodafone bill of 31,500 (later cut to 229) for the man who downloaded a TV show in France.
Consumer fury
These cases do nothing to enhance the reputation of the operators (except perhaps to their shareholders).
Why spend millions on ad campaigns that position you as a warm and cuddly company, helping you connect with loved ones, when the truth appears to be that you are a raper and pillager of the wallet?
If you want to see the kind of consumer fury that has spring up over roaming charges, just hop over to isadisgrace.com/vodafone/roaming.
I particularly liked the effort that went into the comment, “The marketing offers the sun, moon, and stars – the user experience lies somewhere between the gutter and knee-high.”
This kind of consumer outrage is the reason the EU has stepped in to legislate against uncapped roaming tariffs.
Uniform pricing
But why should legislation be necessary?
Surely having user-friendly roaming tariffs would lead to higher call revenue?
When we use our credit cards abroad we accept a 2.5 per cent surcharge for admin costs.
Why is it not possible for networks around the world to keep prices uniform for subscribers wherever they are, and levy a similar administration charge to cover costs of inter-network billing?
The situation is analogous to a car that costs an extra 5 per mile in tolls when used on foreign roads. Or making the top rate of tax 75 per cent, leading to a net reduction in tax revenues.
We are now living in an age where IP broadband, Wi-Fi and 3G technology gives us the miracle of instant communications, to and from practically anywhere on the planet.
It is time for the networks to modernise their international data-pricing business model to reflect this new paradigm.
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