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News and analysis of developments in the enterprise communication industry and market with primary focus on Europe.

The author aims to tap into ideas, insights and thoughts of the readers to get varied perspectives.

Views expressed in this blog are solely the author's opinion and in no way reflect those of his employer.

Thursday, April 12, 2007

Roaming 'rip-off'-Game over

Telecoms.com reported-"A committee of the European Parliament has backed proposals to cap roaming charges for mobile calls made abroad, voting in favour of a Eur40 cents (£0.27) per minute ceiling for an outgoing call and Eur15 cents (£0.10) per minute for an incoming call.
The proposal will be put in front of the full 785-seat EU assembly in May which will decide whether a cap on roaming charges should be automatic, or require customers to request it from their operators."
This news is good for some while bad for others. I am sure GSMA and the operator will agrue that this is a bad move and will affect the profitability of mobile carriers. However, bad mood is expected to reign with innovative players such as LGC Wireless and others, since the proposal diminishes the value of their offerings. It is to be noted that extortionate roaming bills and relatively higher access rates have help form an alternative industry- one that aimed to help consumers and enterprises beat these toll gates. I call the offer 'mobile toll-bypass' untility.
The good news is for the consumers. In advanced countries in Western Europe, the average mobile usage per person is just 4 minutes a day. Using the same infrastructure and services deployed in emerging countries, users talk for much longer- and pay far less-in charges adjusted to purchasing power parity. Good news is for non-mobile carriers, if this proposal becomes legislation they would be able to predict their costs with greater accuracy and price their products more appropriately.
Overall, I think this move will help the industry in predicting costs, and determining value in roaming. The purse of the consumers won't shrink-I believe, they will instead take more for the same money. Licensed mobile operators will remain in business for longer- as this move takes away some cream out of the value propositions of alternate solutions.

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