On Thursday, October 11, 2001, at 06:32 , Michael Turner wrote:
> On business? Your company pays for your mobile phone in the country
> being
> visited. This is expensive? Well, so what? If you're on business,
> presumably you're worth it. What's a little high-rate talking time
> compared
> with all that jet fuel?
Well, in this case I'm afraid to say you couldn't be more wrong.
Many companies, especially multi-nationals have "joined" the EU
antitrust case providing evidence etc etc. Roaming cost is one of the
top items on the corporate agenda right now. Even more so as economies
are slowing down creating pressure for cost cutting. Some large
corporations have tried to team up and set up MVNO style roaming
businesses in order to reduce their cost only to find themselves locked
out because the mobile phone companies didn't want to cooperate. This is
all part of the EU's antitrust case now.
Manufacturers have been trying to tackle the problem from another angle
by increasing the home network's visibility of roaming usage and thereby
reducing the risk. CAMEL is one such example. Yet, one problem with it
is that it is very complex and expensive and it doesn't really take the
problem at its root cause: Too many melkers try to melk to few cows. The
other major obstacle for CAMEL is that operators have to spend all that
money on the technology but it only benefits other networks not
themselves - they rely on others to deploy in order to benefit. Again,
something that favours cartelisation and hence has a tariff increasing
potential.
The reason why the EU and also the mobile operators are interested in
the "visited network charges" model (i.e.ZEBRA) is because it is the
first time that there is a proposed solution that leaves something on
the table for everyone.
Your comment
> ...I ask, "why do you need roaming for this?"
and
> The tourguide service could give the tourist a prepaid non-roaming phone
is actually not so far off because the ZEBRA model does just that. It
negotiates an instant local account (prepaid for tourists, postpaid via
credit card for business people) in the visited network (but with your
existing phone) and the roaming bit is more of an illusion created by
seamless unified messaging services offered by the home network. It's
not really roaming in the traditional sense but what matters is the ease
of use and transparency for the users.
The idea behind this is to enable networks to earn incremental business
on tourists visiting their country and thereby grow the market. In order
for this to work, of course the tariffs have to be comparable to local
tariffs, which is greatly assisted by the fact that there are no monies
going to the home network.
Basically what this does is create a second tier service, like for
example economy class in the airline industry. In the long run this will
of course affect the tariffs of the "business class" however, networks
have time to adjust as they find out where the market sets the premium
they can charge for the premium service.
> I think this egg is going to take a while to hatch. Making it cheap is
> leaving money on the table in the case of business travelers, and of
> only
> marginal value to most vacationers -- hence likely to yield only
> marginal
> reward to the service providers.
Major European mobile consortia think different about this these days.
> Unfortunately, time-zone differences also hinder the Japanese from
> communicating even in Japanese with people back home, when they are in
> North
> America or Europe.
Most Japanese are early birds. In Europe they can easily reach someone
in Japan during their morning while it is still late afternoon or
evening in Japan. Similar for the US West coast where they can reach
Japan in the morning during the afternoon. Admittedly, the East coast
and Latin America is a bit more difficult.
European business travellers roaming in Japan would have an almost
perfect situation (depending on view) because they would receive calls
from unaware callers in Europe during their evening.
Between Japan and anywhere else in Asia (not to be underestimated) there
is hardly any issue with time difference at all.
> I'd go with "more people would use it, and appreciate it, but it would
> become significantly less profitable to the telcos in the process."
My projections, which have been welcomed and confirmed by European
telcos show a surplus on profitability.
> roaming adds little value. In fact, having the call center in Japan
> would
> add costs, one would think. Call center staff would have to work odd
> hours;
> costs are higher here generally.
Most multinationals run Japanese support out of California, Dublin or
London, in the latter case it's Japanese students and bored Japanese
wifes of Japanese expats who do the odd hours. I have been working in
such an environment myself in the early 90s. Microsoft had all their
Japanese speaking Windoze support out of South London (just around the
corner from Wimbledon). Users in Japan didn't even realise they were
talking to someone in London ;-)
Recently I saw a feature on BBC World where Indian call centers were
shown to be very aggressive and active in this market. They had Indians
who received training in US slang and knowledge about various locations
in the US. For example one group which was shown, was trained to talk
like they were from NYC and they had to learn all about NYC so they
could claim they were from there. One Indian guy of this group, who had
never been outside of India btw, was then shown at work talking to a
customer on the phone and he said in perfect NYC slang (as far as I
could tell) "... I'm from NY myself ...". There you go virtual local
call centers out of India for next to no cost - those guys earn 100 USD
per month or so.
> And which would you prefer -- an
> interpreter living in Japan or one working in the very country you're
> visiting?
I am not so sure if I could tell the difference, given the puzzling
efforts of those Indians. :-)
> In fact, with more and more telecom companies trying to dig themselves
> out
> of trouble, making global romaing cheap doesn't nearly guarantee that
> the
> service will also be cheap. More likely, telcos will all agree that it
> should remain expensive; and with so few consumers hurt by such a
> cartelization -- especially since the various workarounds are generally
> cheaper anyway -- I don't think you'd see strenuous regulatory action
> against it.
The European telcos think different now. They fear the EU case like the
plague. And they are looking for a way out. The economy class + business
class formula is a straightforward way to achieve this without abrupt
changes. It's the uncertainty about abrupt change that they have a
problem with not the fact that tariffs will have to move eventually.
> Don't get me wrong (or, as mini-George would say "...Make no
> mistake...").
:-) that's his trademark isn't it ?!
> I think global roaming is cool, and I think it's going to happen; I
> just I
> don't see the pressures being so strong.
In Europe, at least, the pressure is quite tense.
rgds
benjamin
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Received on Thu Oct 11 15:04:15 2001