The Ripple Effect of Roaming Regulation

By Guy Reiffer, Vice President Marketing & Strategy

Roaming regulation has long been high on the agenda of EU regulators and closely monitored by mobile operators and industry commentators. Today, forty percent of roamers switch off their data connections when abroad for fear of ‘bill shock’, so finding a workable solution has never been more pressing. The latest round of widely publicised regulations only serves to reinforce this, and as operators react to these changes they are looking for innovative solutions to deal with the profound impact regulation is having on their business. The EU is not alone in this regulatory drive, as similar activity is gathering momentum in key markets across the world, including the U.S., Latin America, Australia and the Middle East.

To date, much of the focus of industry debate on roaming regulation has centred around the impact on the end-user. However, with the scale of regulatory changes occurring, the effect on the business models of mobile operators comes into much sharper focus. For example, there has been increasing confusion over roaming charges, particularly for data services where users have little understanding of what constitutes a ‘megabyte’. This is leading to a demand for more transparent, service-based charging packages which are tailored to match the needs of subscribers’ individual needs. In practice, this could see business users, for example, have an email-only package which would give them access to their inbox at an economy rate, with additional services such as web surfing carrying a higher cost.

We can look at the sizeable enterprise sector as a prime example of where tailored data packages could help. If an operator is able to understand which groups of individuals within a business travel the most, where their trips are to and from, as well as the type and amount of data they consume, they will be able to offer a highly tailored retail roaming data package for that group based on their specific needs.  In a company which has senior managers regularly travelling between London and New York, for instance, the operator could offer a tailored voice and data package that includes special rates and usage incentives to cover the time spent in the U.S.

This type of micro-segmentation would seem to be a key tool in removing the fear of bill-shock. If a subscriber is given the choice when they land at their destination of signing up for specific packages via app or SMS, they are handed the certainty that they will only consume the data on the package they have subscribed to – whether this is service-specific like ‘Facebook’ or bandwidth-specific. In effect this is the concept of pre-paid data services for post-paid customers.

Solutions, such as MACH’s Data Roaming Engine, are now available to introduce service-based pricing which allows users to sign up for the services that they want at a transparent price. This approach also prevents background data consumption – caused by apps continuously communicating with the ‘cloud’ – driving up users’ phone bills, which is becoming an increasing problem for subscribers. We expect that the industry will start moving to these more flexible business models to optimising their roaming operations in the near future.

About MACH

MACH connects and monetizes the telecom world with cloud-based, managed communications services that monetize mobile data, simplify interoperability between networks, optimize wholesale processes and protect revenues. Combining its flair for successful innovation with its long heritage in data and financial clearing, settlement and hub based connectivity models, it provides its 650 operator customers with the real-time, value added services necessary to succeed in 3G and new 4G mobile ecosystems.
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