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Mobile International Roaming among Arab Countries. Economic Department, NTRA January, 2006. AGENDA. Introduction Objectives Mobile Roaming Market Size Roaming Pricing Components Customers Perspective Regulation Suggested Solutions. Introduction ITU-Arab Region Office - (Jan 2004).
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Mobile International Roaming among Arab Countries Economic Department, NTRA January, 2006
AGENDA • Introduction • Objectives • Mobile Roaming Market Size • Roaming Pricing Components • Customers Perspective • Regulation • Suggested Solutions
Introduction ITU-Arab Region Office - (Jan 2004) http://www.ituarabic.org/
IntroductionEgypt • Egypt's telecommunications (Fixed and Mobile) market is one of the largest growing markets in the Middle East and Africa, with an estimated total revenue of LE 16.5 billion in the year 2004. • Mobile-phone provision had risen to 13 m lines by November 2005, from only 83,000 lines in 1997. • In terms of mobile penetration, Egypt in 2005 stood at 18.5%.
Objectives • Our goal is to review : High roaming prices in the Arab countries • State the desired objective Players in the Arab mobile market Solutions for uncompetitive prices Regulatory actions to end excessive charges for international mobile roaming
Step 1 Step 2 Step 3 Collection & Filtering of Data Analyzing & Depicting of Data Comments & Explanation of Data How did we do it?
Mobile Market Size • There are 22 Arab countries that include 45 mobile operators • 2 Counties including Comoros and Somalia didn’t declare any roaming agreements • Due to lack of Data comparisons were held on 7 countries: - InLocal Roaming Calls Analysis: 8 Arab Mobile operators in 5 countries including Bahrain, Egypt, Kuwait, Lebanon, and Yemen - InInternational Outgoing Roaming Calls Analysis: 10 Arab Mobile operators in 6 countries including Bahrain, Egypt, Jordon, Kuwait, Lebanon, and UAE
Scope of study • Study includes 2 types of International roaming: - International calls to persons in other Arab countries made while roaming abroad - Domestic (local) calls made to persons in the country of the visited network while roaming abroad.
First: International Roamed Call Prices: • An international roamed call is a call made by a subscriber roaming on a visited network to someone in another country. The called person may be a subscriber on the same home mobile network as the calling person , or a fixed network subscriber. • Analysis is for International Outgoing call to home country.
Second: Local Roamed Call Prices: • A local roamed call is a call made by a subscriber roaming on a visited network to another person in the country of the visited network. • The called person may be: -A mobile subscriber of the visited network -A mobile subscriber on another licensed mobile network in the same country - A fixed network subscriber in the same country
Roaming Pricing Components Wholesale pricing vs. Retail pricing (End-users)
First: Wholesale roaming: Inter Operator Tariff (IOT) 1. Mobile originated calls 2. Mobile terminated calls
Inter Operator Tariff (IOT) • Definition • Application Duration • Changes in IOT
1. Mobile originated calls Charged by who? VNW • Pricing Factors: - Destination - Timing - Unit - Terminated NW
2. Mobile terminated calls • Charged by who? VNW • Pricing Factors (Free as incoming roaming is usually zero priced)
Second: Retail roaming: 1. Mobile originated calls 2. Mobile terminated calls
1. Mobile originated calls • Who charges it? HNW • On what basis? (IOT+ Handling Charges) • Who pays for it? Calling PP
2. Mobile terminated calls • Who charges it? HNW • On what basis? IOT • Who pays for it? Calling PP local rate vs. Called PP pays for roaming part of the call
Customers Perspective • Prices charged for mobile users are unsatisfactory . • Hardly anybody knows the details of the different roaming charges and they can be very difficult to find. They are also changed frequently. • The prices differences between different networks are vast, even within the same country.
Regulation we conclude that causes of high charges are : • Absence of real competition • Absence of regulation of roaming • Strong disincentive on operators to negotiate lower prices • Fragmented nature of the market reducing the purchasing power of users • B.T.E. facing alternative operators
Questions & Surveys • There are questions that need to be answered by the operators to home regulators: -Subscribers' roaming traffic volume (minutes of usage) -Routes of Calls ( to which roaming partners) - Price trends in the period of 1998-2005 - Roaming subscribers segmented into prepaid and postpaid * Only then regulators can make the necessary studies and forecasts.
Benefits of the Study • Targeted Free Competition among the operators • Lower Prices offered to customers • More Cooperation among the Arab regulators for the sake of mobile users • Encouraging attractive Roaming price offers for Prepaid customers.
Suggested Solutions • Improving Public Awareness: Launch a section on ARNET website on roaming prices in the Arab region. • To be updated every 6 months supported by regulatory bodies in the Arab world, for transparency and awareness reasons. • Each Regulator review IOT of its home country operators, to ensure fairness and consumer welfare.
Both IOT and retail share the same bulk of costs (mobile access and core network). • IOT has extra cost not applicable for retail. • Retail has extra cost not applicable for IOT • Both IOT and ‘Retail of Visited NW’ should be the same.
Proposed solution • A regulated imposed inter-Arab IOT rate (regulation driven) • Volume-Rate tradeoff deals using the OTA technology (competition driven) • Enabling the Optimized Routing and billing users accordingly (fairness driven)
