Abigail Townsend: When in roam, don't call home on your mobile

O2 may have scrapped charges, but that doesn't mean others will follow
Click to follow
The Independent Online

If you're about to set off overseas for the half-term break, I'm guessing that one of the myriad things you'll need to remember, in no uncertain terms, is: do not phone home.

Roaming charges, those applied for using their mobiles abroad, have long been a bugbear for customers. The cost of handsets has dived, free upgrades are the norm and cleverly constructed packages - from free minutes to friends and family discounts - mean the monthly bill is rarely a burden. Just as long as you stay at home.

The cost of using your phone overseas has hardly budged. Why? Because roaming means big bucks for the operators. Some analysts believe it accounts for between 10 and 15 per cent of the profits of the main players. And in tough, highly competitive markets, where a marginally cheaper deal or a slightly better package is the slim difference between losing and keeping a customer, that is a nice rock for operators to cling to.

But in these "customer-facing" days, doing something just because it makes you lots of money is never going to wash for long. The problem was that there was little customer choice here: you couldn't switch to a cheaper supplier - thereby showing your distaste in the best possible way, with your feet - because every operator was expensive.

The European Commission has turned its sights on roaming, but even that failed to spur companies into action. Until last week, when O 2, now owned by Spanish telecoms group Telefonica, announced that it was abandoning charges for receiving calls abroad (UK customers will instead pay £5 a month).

Finally, if you've had enough of paying over the odds to your mobile operator on holiday, you have an alternative - walk away and sign up with O 2. So surely, its rivals will have little choice but to follow suit? If they don't, they'll losecustomers and market share.

And yet, few analysts seem to believe that this is going to happen. Instead, most are predicting little change to the status quo unless the Commission introduces price caps, a proposal currently moving through the European Parliament with no decision due until December.

This pessimism could be proved wrong. Other operators could follow O 2's lead before they are forced to, and wouldn't that be good news. But on balance, it seems that the roaming cash cow is just too attractive to let go for the time being, no matter what one lone operator does.

Browned off

Nice to see Gordon Brown trying to win over the City last week. It was done in his own inimitable way - no glitzy parties for hundreds of the City's top men and women, as the Conservative Party is currently organising. Instead he held a modest breakfast for 34 at No 11.

But still, it was a step in the right direction. Rightly or wrongly, the City is sceptical about Mr Brown, and remains unnerved by the prospect of him becoming prime minister. So a chance not just for a meet-and-greet but for an open floor to put questions and raise issues will have helped.

But Mr Brown still has a long way to go, and that is most evident in his guest list - not who he invited, but who he neglected. Enjoying the Chancellor's orange juice were the likes of the Bank of Scotland's Sir Fred Goodwin, Philip Yea of 3i and Sir Win Bischoff from Citigroup. But where were the fund managers, the bosses of hedge funds and the other venture capitalists? Much has been made of the fact that Icap's Michael Spencer was not there, for instance.

Yes, he is closely associated with the Conservatives. But for all the good PR Mr Brown is hoping for, it will be worth little if he does not get people like Mr Spencer - the City's new breed of heavyweights - onside as well.

a.townsend@independent.co.uk

Comments