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Thursday, October 1, 2009

Termination rates are already falling - so why all the fuss?

Mark Bridge writes:

With over 100,000 people having signed its petition in four months, there’s no denying that the Terminate The Rate campaign is attracting supporters. And with promises including “BT and 3 are working together on a petition that will lower your phone bill by reducing the level of Mobile Termination Rates”, it’s easy to see why.

But what’s the point of all the campaigning - and has it really achieved anything?  Terminate The Rate – which is run by 3 UK – says mobile networks charge a Mobile Termination Rate (MTR) of around 4.7p per minute for connecting a call to another network. That’s a lot of money over the course of a year. But those networks also pay that 4.7p when calls are connected to them, which cancels out a fair bit of it. Now, I don’t doubt there are some profits in there. But, to be frank, I don’t see much real consumer benefit in cutting termination rates. It seems to me that any profits lost from MTRs would simply be generated from increased charges elsewhere. Even if new tariffs offered ‘more value’ they’d be likely to cost more. Regulators have even suggested that we could cut MTRs and then pay to receive calls. Do I hear the sound of a lead balloon going down?

And I’ll confess I’m suspicious of 3’s volte-face; arguing in favour of increased MTRs when it suited and then arguing against them when it didn’t get its way.

Okay, so none of us likes spending money when we don't see a benefit – but talking about “bill shock” and a “a secret tax on consumers” is more like tabloid rhetoric than an informative campaign.

And some of the campaign supporters seem to be sending confused messages, too. For example, the Plain English Campaign said “Consumers deserve the right to understand complex issues that affect them in the simplest possible terms and we support any organisation that strives to do this” – which seems to suggest it would just as happily support an increase in termination rates if the organisers had a ‘Crystal Mark’ on their literature. There’s also plenty of talk from organisations about supporting the campaign because it’ll reduce charges – although that's certainly not guaranteed.

I was pleased to see that Martin ‘Money Saving Expert’ Lewis was, like me, unconvinced by the campaign. He told us “We’ve decided not to back the Terminate the rate campaign for the time being. As the decision was in the balance we put it to our users and the majority weren’t in favour of doing so. This is an important issue and one to look at, though we’re not fully convinced a campaign run by a big mobile phone network which is in its own vested interest is the right way to go forward”. And that makes me wonder how many other organisations had also declined to join 3 and BT’s party.

Terminate The Rate plans to give its petition to Ofcom later this month. And then what?  Perhaps my biggest complaint about the campaign is that, even before it launched, the European Commission had told Ofcom and other European regulators to make sure MTRs reflected actual costs. And MTRs are already set to drop next year. Which suggests everything’s in hand. And in 2011, when the current charges are reviewed, we’ll probably see a decent-sized drop in MTRs... which would have happened regardless of any campaign.

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Opinion Articles

An extra 74 percent of nothing is still nothing

Mark Bridge writes

Ah, the joys of multiplying by zero. I was reminded of my school maths lessons when I saw a news release from Orange UK this week.

Steve Wallage, Head of Sport Partnerships and Services for Orange UK was quoted as saying “Based on the surge in demand for mobile TV during the Ashes last summer, we expect viewing figures could rocket by at least 74% during the World Cup”.

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Hotel doors open with mobile phones... but it's not like WarGames

Mark Bridge writes:

I loved the film WarGames. I saw it in the cinema when it came out… and developed a minor crush on Ally Sheedy as a result. If you don’t remember the film – or haven’t seen it – the plot centres on a young computer hacker who almost starts World War III while playing an illicit online game of Global Thermonuclear War with a military computer.

Author: The Fonecast
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Apple, Google - or the rest? It's time to take sides!

Mark Bridge writes:

It’s time to take sides. Are you with Apple… or are you against them?  Sorry, sitting on the fence is no longer acceptable. Not sure?  Okay, try this one for size. Are you with Google… or are you against them?  Still undecided?

Right – here’s your third choice. Are you with the Rebel Alliance? 

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A lukewarm mobile payment solution doesn't benefit anyone

Mark Bridge writes:

It's not often that a news story about the Apple iPhone prompts me to remember a bible verse... but this week was an exception.

The story was in The Washington Post and it was headlined 'Apple's iPhone does well without being the best'. “Very true,” I thought, as I remembered something similar I'd written last summer.

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Carnival of the Mobilists #224

Mark Bridge writes:

Welcome to the Carnival of the Mobilists #224. If you’re a regular visitor to The Fonecast and have no idea what the Carnival is, this is a summary of the week’s best blogging about all things mobile. It travels the internet, alighting at a different mobile-related website every week.

Carnival of the Mobilists

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Recent Podcasts

Reviewing our 2015 mobile industry predictions... and looking forward to 2016

Podcast - 15th January 2016

Iain Graham, James Rosewell and Mark Bridge return to review their mobile industry predictions from last year. Which mergers, partnerships and developments did they forecast correctly... and which didn’t work out as planned?

Later in the programme, the team anticipates some of the topics that will be hitting the headlines during 2016.

Author: The Fonecast
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Podcast from Mobile World Congress 2015

Podcast - 6th March 2015

Mark Bridge learns about the mobile technology trends at Mobile World Congress 2015 by chatting to James Rosewell of 51Degrees, Dr Kevin Curran from the IEEE and Chris Millington of Doro.

They talk about wearable devices, wireless charging, mobile operating systems and much more... including some of their favourite products from the exhibition.

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Looking back at February: from security scares to multiple MVNOs

Podcast - 27th February 2015

We're taking a look back at the biggest mobile industry news stories from February 2015, including allegations that the UK's security service tried to breach SIM card security by hacking into one of the world's biggest SIM producers.

We also talk about the planned BT and EE merger, the creation of two new UK virtual networks, some acquisitions in the mobile payment arena and a new Ubuntu smartphone.

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Interview with Chris Millington of Doro about mobile retailing, wearables and technology for older consumers

Podcast - 24th February 2015

In today's programme Mark Bridge talks to Chris Millington, who's Managing Director for Doro UK and Ireland.

They discuss the state of mobile retailing in the UK, the future of wearable devices and - as you might expect - smartphones for seniors.

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A month of mobile: O2 counts on 3, Microsoft counts to 10 and Apple counts its profits

Podcast - 30th January 2015

We're back with a month of mobile industry news, including takeover talks and takeover rumours. O2 and Three are said to be discussing a merger... but is there any truth in the suggestions that BlackBerry could be up for grabs?

We also discuss Apple's record-breaking quarterly figures, the highlights of CES and the launch of Microsoft Windows 10, as well as saying farewell to the current version of Google Glass.

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