Mike Manzo, Chief Marketing Officer at Openet, calls for transparency from mobile operators on data roaming charges
Many mobile subscribers still avoid using their phones and dongles abroad due to high perceived costs and a lack of understanding of roaming charges. A recent YouGov survey commissioned by Openet showed that 67% of respondents chose not to use data roaming at all when they were abroad, with only 8% using data services at least once a day. Given that operators are looking at mobile data as a growing source of revenue, it is vital for them to address customers fear of bill shock.
Every summer, stories of angry mobile phone users invade the press as holidaymakers are awakened from their holiday bliss by surprisingly high phone bills on their return. Last year, the EU introduced measures to tackle the issue of bill shock by setting a maximum Euro tariff to be charged for calls and text messaging - now the spotlight is on data roaming within member states.
As of last week, mobile phone operators are obliged to offer their customers a monthly cut-off limit. Individuals who do not choose an allowance by 1 July 2010 will have their cut-off limit set at 50 (45) by default. The EU regulation also states that all consumers will automatically receive a warning when they hit 80% of the chosen limit, and that operators should do a better job of informing subscribers of the costs of data roaming services when they enter a member state.
The new regulation is also limiting the wholesale price of data (setting-up a cap of 1 per MB downloaded), reducing inter-operator charges. The regulators have called on the mobile industry to pass these savings on to data roaming customers swiftly.
Consumers will welcome steps to protect their wallets from unexpected bills, as there is still confusion regarding the cost implications of making mobile phone calls or using data services when travelling abroad. Users don't understand the charging structures used by mobile operators.
It is in operators best interests to address this problem to create additional revenue sources. A customer that suffers bill shock one is likely to be a lost one. According to Viviane Reding, the former European Commissioner for the Information Society and Media: "It's happened to my own children. One shocking bill and they don't use their mobiles abroad anymore."
Transparent billing options
Operators should encourage individuals to use their mobile devices when abroad by selling, and educating users about, roaming data bundles, and providing more transparent billing options, not just before they leave home, but also when they start using their service abroad. This will give subscribers certainty as to their costs and comfort in using their service.
The EU regulations offer operators a push in the right direction, giving them the opportunity to take the moral high ground by making it easier for customers to manage their mobile phone bills. Central to avoiding bill shock is the timely communication of usage information. Consumers should be able to set-up thresholds for different services and manage balances in real time, so that whenever a specified threshold is reached, spend alerts can be sent, and usage restrictions applied, with configurable options to override a limit.
It is time for the mobile industry to take in hand the best interest of their customers by providing greater transparency and simple billing options. Instead of mandating limits to customers, service provides should create tailored services that allow the peace of mind mobile subscribers are looking for when travelling.