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How I avoid high mobile charges - TUANZ Chair

27 Apr 2010

TUANZ Chairman and Rank Group CIO Pat O'Connell says telecommunications is the bane of the business traveller's life and users are forced to jump through a myriad of hoops to avoid bill shock.

O'Connell is responsible for the ICT spend in Graeme Hart's multi-national packaging empire and is a regular overseas traveller. He says in Australia users pay $8 a megabyte for mobile data, but in the US the cost is as high as $30 a megabyte.

A regular visitor to the US and Europe, O’Connell usually switches off data roaming on his cellphone when travelling overseas and relies on WiFi instead. “Even WiFi’s a ridiculous cost, [but] $25 a day in a hotel is still better than the costs that you get with cellular roaming.”

O’Connell sometimes buys a local prepay phone when he arrives in a new country. “I can call internationally from a local prepay phone that I pay $39 for, for something like 10c a minute.”

Then there is SKYPE, which he uses to route a call via the internet back to the network and, from there he can phone a local user for about one or two cents a minute. (According to the Commerce Commission's 2009 Telecommunications Audit released last week, SKYPE is now the largest provider of cross border communications in the world.)

“These are the myriad of hoops you have to jump through to avoid the penalties that are imposed by international roaming charges,” he says. “It’s not something that your average travelling business person is going to be really interested in – billing – or probably technically proficient enough to be able to choose the right option and get it working at the right time.”

He’s encouraged by ICT Minister Steven Joyce’s comments last week at the TUANZ Telecommunications Day that he is in discussions with Australian Senator Stephen Conroy on international roaming charges. However O’Connell says while most travellers visit Australia, for international businesses such as Rank Group, the real bill shock is from cellphone use by senior executives who travel more widely.

For local mobile network operators, international visitors roaming on their networks while visiting New Zealand is a lucrative earner. 2degrees chief commercial officer Bill McCabe told Telecommunications Review shortly before the network’s launch in August that he believed it was worth $100 million a year. The fledgling mobile operation has ensured a seamless coverage along the “airport corridor” – from the international airport to the Auckland CBD - to help ensure that when tourists land in NZ, they remain on the 2degrees network. It was also a factor in 2degrees's decision to build its own cellsites in Queenstown. Prior to 2degrees and the launch of Telecom’s XT Network, Vodafone had the international roaming market in New Zealand mostly to itself.

O’Connell believes the root cause of high international roaming charges is mobile termination rates – the fees telco’s charge each other to terminate traffic on their networks. “Termination really is the crux of a lot of problems facing consumer use of telephony, because it hampers commercial use or even private use of cross network traffic.”

ICT Minister Steven Joyce has asked the Commerce Commission to reconsider its earlier recommendation that mobile termination rates not be regulated.