INTERNET
Telcos say mobile charges too high
19-05-2003
by Ralph Averbuch
At an ALTO conference in Dublin on Monday, executives from leading telecoms in Ireland questioned the lack of competition in the mobile sector.
Held at the Conrad Hotel, the emphasis of the morning conference was on the need for increased competition within the mobile sector. To that end the Association of Licensed Telecoms Operators (ALTO) laid on speakers from Virgin Mobile, MCI (formerly Worldcom), IBEC's Telecommunication Users Group (TUG), Meteor and the EU Commission.
A key issue of concern was mobile ARPU, or average revenue per user, which is higher in Ireland than in most other European countries and has been an area of contention within the sector. Speaking to the room John Doherty, Commissioner for ComReg, asked why the two major mobile operators, O2 Ireland and Vodafone Ireland, were not ready to publish their data on call minutes and revenue to give a clear indication of mobile users' habits.
"Comparison of tariffs in Ireland is extremely difficult," said Paul McSweeney, the Chairman of TUG, echoing Doherty's concerns. "Information on price, usage and performance standards should be freely available."
Meanwhile, Iarla Flynn, Chairman of ALTO, spoke in more general terms on the lack of competition in the sector. "We have a healthy mobile market in terms of consumer take up, yet, competitively there is little choice in terms of price or providers," he said. Flynn attributes this state of affairs to the fact that just two mobile telcos hold 96 percent of the market, the delay in full mobile number portability for customers and the absence of virtual mobile network operators (MVNOs)
He also said that ComReg data shows that Irish consumers pay the highest mobile bills in the EU, and dismissed claims that Irish mobile users simply talk more, urging Vodafone and O2 to provide "proof to back up those claims."
Taking a rather different tack, Barney Lane from MCI (formerly Worldcom), highlighted a perceived imbalance between the heavy regulation of landline telecoms and relatively light regulation of mobile operators. "Our customers call mobile phones and they pay through the nose for it due to the termination charges."
In fact, using MCI's own data, he claimed that while calls from MCI customers to mobiles represented about 10 percent of total call traffic, it amounted to a whopping 50 percent of costs. He argued that landline operators charge other operators for termination of calls on a cost basis while mobile operators are free to charge what they like.
While Lane accepted that the mobile termination rates were lower in Ireland than in other parts of Europe, he said they are still too high. "Even if Ireland is the best in Europe for mobile termination rates, it is the best of a very bad bunch."
According to ALTO these access charges, from a landline to a mobile, add up to over EUR300 million per year for the telecoms industry and consumers.
Yet, despite the harsh criticism laid at the door of both Vodafone and O2, the conference ended on a high note, highlighting the fact that from the 25 July full number portability will become a reality for all consumers on all the mobile networks.
ALTO was set up in 1998 to represent the interests of new operators entering Ireland's telecoms market, representing national and international operators in the fixed, wireless, mobile and cable sectors. ALTO lobbies regulatory authorities and policy makers such as the government, the EU, the ComReg and the Competition Authority and reports on current and future legislative and regulatory developments.
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