Labor Blitz on Roaming Bill Shock

[BESadmin]

Labor blitz on roaming bill shock
12th August 2008
www.australianit.news.com.au

THE Rudd Government has sent a clear warning it wants mobile carriers to ease charges Australian consumers face when using their mobiles overseas.

Communications Minister Senator Stephen Conroy was today sharply critical of mobile carriers after accounting firm KPMG lodged a report with the federal Government in June revealing that Australian consumers are getting a raw deal on roaming charges when compared to their counterparts overseas.

“International roaming charges are the subject of complaints where prices are high, making it very expensive to make mobile phone calls while overseas. This issue deserves attention particularly as mobile data services grow and businesses come to rely even more on cross-border access,” Senator Conroy said in statement.

KPMG found that mobile carriers collect "very high" margins on roaming services sold to Australian consumers.

It also found that there was little competitive incentive for carriers to decrease mobile roaming charges and that consumers were not being given a clear picture of what they could expect to pay when using their mobiles overseas.

"Numerous public and private technical studies referenced throughout this report suggest that international mobile roaming charges are unreasonably high," KPMG wrote in its report.

To illustrate its findings, KPMG cited prices Australian consumers traveling to Beijing for the Olympics could expect to a pay for calling home. They could expect to pay a minimum of $1.86 per minute to call home under Vodafone's pricing scheme for China.

Optus customers were the worst off of the four major carriers being charged $4.79 per minute to phone home from China.

Telstra and Three consumers walked in the middle of the pack facing charges of $2.88 and $3.02 per minute respectively.

In the absence of competitive pressure, KPMG cited a lack of regulatory instruments as the contributor to the current excessive mobile roaming pricing schemes faced by Australians.

"In the research data that we have analysed, it is generally concluded, that the absence of government supervision of international mobile roaming retail prices is a contributing factor to the current high levels of disparity between roaming costs and consumer prices," KPMG wrote.

The report is part of a wider federal Government inquiry into mobile roaming charges.

In June Communications Minister Stephen Conroy ordered the House of Representatives standing committee on communications to investigate retail tariffs for international mobile roaming charges continue to reflect costs born by carriers.

The committee is following up on an inquiry carried out by the Australian Competition and Consumer Commission (ACCC) in 2005 which also found that carriers may be charging excessively high prices for international mobile roaming services.

The standing committee has sought assistance from the community and interested parties to pursue its investigation.

“I would encourage anyone with an interest in this issue to read the report and make a submission to the inquiry,” Senator Conroy said.

Optus and Vodafone have confirmed that they plan to submit reports to the committee. It's understood that he ACCC will also submit a new report to the committee.

Submissions are due Friday August 15.

The Australian Telecommunications User Group (ATUG) welcomed the report.

"ATUG is delighted to see the Minister understands the concern of end users about mobile roaming charges and the dangers of “bill shock” that await customers using voice or data services while roaming ," said an ATUG spokesperson.