The Mobile Tool Kit

October 27, 2010

Karoline Hansen, Camille Lepage and Anouk Mentink

Yesterday we had landlines phones, today mobile phones, and tomorrow access to the Internet from their pockets. Not only the evolution is fact but it also requires international regulations in order to avoid abuses for greedy phone company taking advantage of the market.

The telecom markets in several EU Member States were liberalized in 1998. The Commission introduced the Telecommunication package in 2002 to realize this goal. The package states that:
• Telecommunication companies must have free access to the whole European market
• Alignment about the usage of networks
• Harmonization of technical standards
• Protection of consumers
• Monitoring the telecommunication market on a national level

Results from 2002 until 2006 showed that the Telecommunication Package was way too poor. In 2006, the Council of Transport, Telecommunication and Energy demanded for more competition on the telecom market. Since the Council asked for more, the Commission did several proposals. The European Commission states that EU-citizens already might have noticed some changes, made by the Telecommunication package, like:

• Clearer understanding of telephone costs
• Lower tariffs on calling abroad
• The option to choose for any provider
• Changing from one provider to another and keeping the same phone number
• Access to the EU alarm number

The Council of Transport, Telecommunication and Energy agreed on a number of reforms, within the Telecommunication Package, on the 20st of November 2009. Some reforms are:
• More protection on the rights of consumers
• Fighting censorship on the internet
• One joint EU Telecommunication Market: providers and consumers in one field
• Improvement on internet access for all European citizens

The EU has successfully operated against phone tariffs for calling abroad, at least, that is what the Commission says. Brussels wants to stop providers who try to compensate this loss by computing their customers extra money for their conversations. For instance, a customer calls 2 minutes and 2 seconds, but has to pay for 3 minutes. In this example, the provider completes every second to a minute.

Latest developments
The EU created a new advisory body, to control Member States in their national policy on telecommunications. From the 1st of July, all telecom providers are obliged to put a limit on the use of internet abroad, since many travelers don’t know that they’re using the internet on their phones while being abroad.

Internet in your pocket

Nowadays, not only mobiles are essential to our daily life but people usually struggle to imagine their lives without one. For the last 5 years, we have seen the explosion of the Internet on mobile. This new technology is a revolution, as it allows anyone to have access to any data, emails and information anywhere without having to a computer. The Eu is actually leader in this field with 29% of European Internet users regularly access the Web from their mobile phones compared to only 19% in the US. Germany and Italy have the highest mobile web penetration with 34% for each, followed by France with 28%, Spain with 26% and the UK with 24%.

As well According to the study, mobile Internet adoption is set to grow to 39 percent in Western Europe in 2014 from 13 percent in 2008.

“The recession is forcing many consumers to reduce their spending, but they aren’t cutting out their mobile subscriptions altogether,” said Forrester analyst Thomas Husson. He said Internet-centric phones and flat-rate data plans stimulated mobile Internet adoption

In the next decade, the mobile Internet will replicate the success story of the PC-based Internet as social networks, widgets, search engines or company websites adapt for mobile presentation, Forrester said.

The price to pay for being in the wrong country

The price for Internet connection depends on the networks the costumer is on and the country he/ she lives in. For example, a striking comparison is the Iphone 3GS 8gb in France and in the UK. In France, this Iphone costs 99€ and the minimum monthly contract costs 64€ for 3hours and unlimited calls after 8pm at night and during the weekend for a 24 month contract. Whereas in the UK the same mobile with the same operator and the same monthly contract price, you get unlimited minutes and unlimited texts and the iphone is free! The normal contract in the UK would cost about 40 €, with a free Iphone and you would still get 10 hours of phone calls and unlimited texts. The difference between those countries is very outstanding, however there is no explanation about such a difference.

The problem isn’t about fair competition anymore, as prices are set up by the same company which only levels them up or down to the national cost average. It is unacceptable to see such a divergence between those prices. The EU has the duty the regulate those prices and make them fairer to any European citizens.

One Response to The Mobile Tool Kit

  1. peter.verweij on November 3, 2010 at 1:40 pm

    Very well researched stories with lots of background and details. But at the end I would like to know how much it would cost to make an international call, and are the costs for the call not too high? Your analysis of the market en rules is correct, in order to make the story a bit more attractive start with user quotes and talk about high prices.

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