Two Countries, Two Vastly Different Phone Bills

http://www.nytimes.com/2014/08/24/business/two-countries-two-vastly-different-phone-bills.html?emc=edit_th_20140824&nl=todaysheadlines&nlid=67837012&_r=0

by fideloper • 12 years ago

49 65 12 years ago

nytimes.com

ksec• 12 years ago

Britain has forced companies to lease their networks to competitors at cost?

So anyone could just enter the market?

dozzie• 12 years ago

Yes, pretty much. That's the point of the regulatory required by EU, which UK implemented.

abritishguy11• 12 years ago

Well not really.

nickjackson• 12 years ago

giffgaff is a great example of this, a very small company that piggy-backs on the O2 network, giving really cheap tarifs. http://giffgaff.com/goodybags

jamesbrownuhh• 12 years ago

Giffgaff is an MVNO, that's true, but it is actually owned by O2.

cperciva• 12 years ago

So anyone could just enter the market?

Better question, why would anyone ever build a network if they are prohibited from making a profit?

akie• 12 years ago

They are still making a significant profit, but not as much as they would without this legislation.

sgift• 12 years ago

That kind of legislation usually is only relevant for the "incumbent" (because the rules usually state "if you have more than x% of the lines .."), i.e. the ex-monopoly provider who didn't build anything. It was build by tax payer money and then given to them.

abritishguy11• 12 years ago

Not mobile networks.

abritishguy11• 12 years ago

This isn't true. This is only true for broadband. The article is wrong.

izacus• 12 years ago

That's a rather common practice to fight natural monopolies - here in Slovenia the largest operator (which was merged together from a landline / mobile / ISP) has to provide it's own networks (landline / FTTH / mobile) to competitors at a market price.

Keeps the competition going and benefits users.

martinald7• 12 years ago

The article is wrong. It's for fixed line broadband.

Though there are a lot of cell/network sharing agreements in the market (to various extents - some are actually cell roaming but some are just sharing backhaul/fibre/the physical towers):

O2 and Vodafone Orange and TMobile (merged to form EE) Three and TMobile (may or may not include ex-Orange sites, not sure).

Falkon1313• 12 years ago

I've always gone with the no-contract plans. I pay $35/month for the same phone and unlimited service that one of my family members is paying $100/month for. Really I don't see the point of the contract plans.

mixmastamyk• 12 years ago

Right, I took it on the chin to buy my phone, but overall the cost is much less. Some months I pay nothing at all.

aceofspades192• 12 years ago

I got my nexus 4 for 'free' on a contract and even if I bought it outright and got on the cheapest plan with roughly the same features, I would've only saved $5 a month. 5 * 24( 2 year contract) is only 120 so by going on a contract I saved at least $100 on the cost of my phone. If you are smart you can save money by going on a contract.

__xtrimsky2• 12 years ago

I don't think you researched well enough, 5$ saving is nothing. tell us which plans you were deciding between.

For example Straight Talk, is 45$ / month, everything unlimited. And you can use either AT&T's coverage, either T-Mobile's or Verizon's (and their phone too).

And that's for everything unlimited, you can find cheaper if you don't need unlimited.

chrisBob• 12 years ago

Can you share what plan you use? From my experience no-contract plans usually have some issues like no off network roaming. Maybe this isn't a deal breaker, but it is a different level of service.

abritishguy11• 12 years ago

I've always found it funny that it is cheaper to use my UK monthly rolling contract in America (free roaming yay) than it is to have an American contract - completely bizarre.

gress• 12 years ago

Which contract is that, and from which operator?

abritishguy11• 12 years ago

Any of three's contracts with unlimited data.

robin_reala• 12 years ago

http://www.three.co.uk/Discover/Phones/Feel_At_Home

kleiba• 12 years ago

Just curious, but is it possible to give the costs for comparable contracts in other countries, too?

seszett• 12 years ago

I'm paying 20€/month in France, for unlimited calls (to France and a large part of the world) and texts as well as 3 GB data (20 GB over 4G, but my phone can't use that).

A phone isn't included in the contract (the contract can be stopped anytime) but my provider (Free) also sells phones on credit, say an iPhone 5s for 49€ one time payment and then 16€/month over 24 months.

That makes a close equivalent of the US contract, for 38€/month or about 50$/month.

Also, in reality I'm paying 4€/month for this contract for the first 12 months because of a promotion back in June.

emixam• 12 years ago

Also noteworthy: you won't be charged if you use more than 3GB/month of data, only the download speed is reduced

sergiosgc• 12 years ago

I'm paying, in Portugal, ~100€/month for a plan that includes 100mbps fiber, land-line and service for four cellphones. National calls are unlimited. Data over fiber is unlimited. Data over cellphone is limited to 200MB per cellphone (add-ons to extend data usage exist). Cellphones themselves are not part of the plan.

jnardiello• 12 years ago

Italy is considered close to a third world country BUT as i can see it provides cheaper and better connectivity.

No contract, unlimited data, unlimited minutes and unlimited texts (but no phone): 10€/month. On a 30 months contract with everything unlimited and an iPhone 5s will costa about 35€/month. Which means abput 50$/month.

petercooper• 12 years ago

Three is awesome. I actually tether through my phone at work because getting ~10Mbps to myself over 3G beats sharing a 10Mbps leased line amongst about 20 offices. I always have YouTube or Twitch on in the background, etc, and never run into any problems. I pay something like £20 a month.

To balance though, historically Internet access options were not good.. I was on dialup until about 2003, and then pretty horrific 1Mbps DSL until at least 2009 or so. The UK has done a great job at catching up somehow.

cstross• 12 years ago

Other things about Three:

* The monthly contracts (and higher value pay-as-you-go top-ups) come with "Feel at Home" roaming -- in about 12 countries worldwide you can use your inclusive minutes, texts and data with no international roaming fees, i.e. you get that all-you-can-eat data overseas. Countries listed include the United States; on one recent 2-week trip to the USA I was able to use my iPhone for data as if I was at home with no added charges.

* British phone tariffs do not charge you for receiving text messages.

* The all-you-can-eat is capped (small print) at a "fair usage" of 25 Gb/month. Tethering is disabled while roaming overseas on "feel at home", but not prevented at home.

* If you buy a smartphone from Three, they'll unlock it at any time, for free, on request.

* In non "feel-at-home" countries they'll give you 24 hours' data (capped at 500Mb) for £5. Not as good, but better than typical international roaming fees (at £0.5/Mb in the EU and up to £3/Mb outside the EU).

Those of us who are used to this kind of cell service boggle in amazement about how backward the US carriers are.

The final irony? Three is pretty backward and expensive compared to what Estonians get from their cellcos ... the UK is by no means the best world-wide, it's just a handy point of reference.

martinald7• 12 years ago

There is no 25GB limit on the AYCE. I've pushed nearly 500GB one month tethering on 4G (my old apartment had very slow upload and could get about 20mbit up on 4G - great for server restorations and bulk data transfers) and many times over 25GB and have never got a letter.

From the Three 'small print': So in essence there is a limit of how much data you can actually consume which is up to 1000GB. All this means that you can have absolute peace of mind and enjoy all the internet you need on your smartphone, without worrying. Basically, the limit is about 1TB/month.

xSwag• 12 years ago

The all-you-can-eat is capped (small print) at a "fair usage" of 25 Gb/month.

I can tell you that this is wrong, I've personally had months where I've used 100GB+ of data over 3G and had no problems (this is on a £15 top-up). I don't know if they throttle or not, I've never really noticed it.

Tethering is disabled while roaming overseas on "feel at home", but not prevented at home.

I didn't get my handset from Three but I've been able to tether in Paris and used at least 2GB when I was there.

chrismeller6• 12 years ago

I would think that one of the "several factors involved" may dwarf regulation: area.

The UK operators have 94,000 square miles to cover while US operators have a little over 3.1 million, just in the lower 48. Obviously no single carrier is ever going to cover 100% of either country (and in the US in in particular they don't come even close), but the simple size of the problem in the US drives their infrastructure costs way up.

If AT&T only had to cover the state of Michigan (96,000 square miles) they could probably do it for less than $60 a month...

I agree that we don't have nearly enough competition in the US, but let's not pretend that a few more "harmless" laws will make everything rosy and perfect.

abritishguy11• 12 years ago

Well that doesn't explain why it is cheaper for me as a Brit to roam using my UK contract in the US than it is to take out a US contract. When I'm visiting America I am literally paying less than you folks for your stuff.

I can go to US and use unlimited data for no extra charge.

chrismeller6• 12 years ago

No, it doesn't. Not knowing much about the UK market, I don't really have enough information to base an opinion on.

My first wild guess would again be regulatory: do they have to eat the extra costs involved so they provide you with the same price every month?

joosters3• 12 years ago

That's not true in general. UK phone companies love to charge astronomical international rates when they can get away with it. Only EU maximum charge limits have capped these.

For example, in an EU country like Greece, I can phone a UK number for a maximum of 18p/minute. If I happen to travel near the border with Turkey and connect via one of their networks, there's no regulatory maximum price and the cost jumps to 69p.

maxxxxx2• 12 years ago

If the area argument was true then areas like Los Angeles or NYC would see cheap prices and great coverage.

chrismeller6• 12 years ago

No it wouldn't, because that's not the only area your plan covers. We all acknowledge that we are averse to limits of any kind (hence unlimited calling, even if we only ever use a couple hours a month!), and that includes area restrictions.

Imagine if your cell phone required that you pay some outrageous roaming fee or get a special temporary pre-paid package if you drove out of NYC into NJ.

Edit: Typo.

PaulHoule• 12 years ago

So far as I can tell, cell phone technology works best in third- or fourth- tier cities like Rochester, NY. The worst cities for cell phone coverage are cities like LA, NYC, Washington DC, etc.

In very dense areas they have to put in more cells, deal with the fact that there is a lot of metal around, multi-path propagation, more difficulties getting towers sited, etc.

In rural areas I think the cost has more to do with topography than anything else. In a mostly flat area that has an occasional mountain that's taller than anyone else, you can space towers far apart. In the Appalachian mountain region, however, you have a network of ridges that are all about the same height, so you'd need to run power and fiber to the tops of all the ridges - you might as well just run FTTH to all the homes, except you couldn't charge $10 a GB for FTTH.

potyl• 12 years ago

I doubt that area is a main factor. If that would be it then Russia would have higher prices and less subscribers, yet SIM card penetration approaches 170% (see http://www.budde.com.au/Research/Russia-Mobile-Market-Insigh...).

chrismeller6• 12 years ago

You're not taking into account population density. Russia's population is very heavily concentrated in relatively few areas... Not much need to blanket all of Siberia with cell towers.

abritishguy11• 12 years ago

I would like to point out that the following part of the article is not true (she was probably getting confused with broadband):

"Britain has forced companies to lease their networks to competitors at cost"

jackgavigan• 12 years ago

Actually, the original mobile network licences issued back in the '80s required that the licence-holders sell airtime to any service provider who asks for it, at the same price and conditions offered to the service providers owned/controlled by the licence-holders. That paved the way for MVNOs.

RichardFord• 12 years ago

I pay about $75 for 2 gigabytes from Verizon, so I don't know where these numbers are coming from.

abritishguy11• 12 years ago

Do you get unlimited texts and calls? Because without that the UK price drops to £15/month.

anemitz2• 12 years ago

It's worth noting that the billing methods for US and the rest of Europe are very different when it comes to voice. For instance, it costs between 4c/min to 26c/min to call a UK mobile phone. In the US it's < 1c/min. Outside the US, the caller of a mobile phone is generally the party footing the bill for the entire call.

The more interesting question I have is why would it cost 26c/min to call a mobile phone? And since each carrier prefix may have a different cost, how do consumers keep all these prefixes / carrier rates straight in their heads?

Edit: I'm looking at flowroute, plivo, and twilio.

martinald7• 12 years ago

Not correct and I don't know where you get those prices from. OFCOM has regulated termination charges (http://stakeholders.ofcom.org.uk/consultations/mtr/statement) in the UK. Right now they are at 0.8p/min but it is likely they are going to rule to drop them to below 0.5p/min.

Edit: these are wholesale prices, so there will be some overheads for whoever provides it to end users, but the crazy termination fees in the UK are long gone.

anemitz2• 12 years ago

Where does the overhead come when you look at rates from carriers like http://flowroute.com/rates/ or https://www.plivo.com/pricing/GB/ or http://www.twilio.com/voice/pricing/gb

It might be that wholesale rates are capped but it clearly isn't pushing prices down for consumers who want to call into mobile numbers.

joosters3• 12 years ago

The maximum that a UK mobile company can charge for an international call in the EU is 18p/minute, around 29c. Same-country calls are naturally cheaper.

Another thing to consider is that off-plan call rates are certainly high, but since you could get a better plan for less than the cost of an off-plan call, you won't be making many of them.

Generally all carriers are covered by any plan minutes so you don't have to worry about differing charges. Ironically though, in the UK, calls to freephone numbers are mostly not included in plans so they do cost money...

lostmsu• 12 years ago

FreedomPop

__xtrimsky2• 12 years ago

I pay 45$ / month for everything unlimited with Straight Talk (uses AT&T's coverage).

And my wife pays 30$ for 100 minutes, unlimited text and 5GB data with T-Mobile.

even 67$ I find that pretty expensive.

mlucero• 12 years ago

I am switching to that 30$ plan as a result of this post. Just saved me half the cost of my monthly bill. Thanks!

Two Countries, Two Vastly Different Phone Bills

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