TELECOM Digest OnLine - Sorted: Re: America the Worst For Cell Rates and Plans

Re: America the Worst For Cell Rates and Plans

John Levine (johnl@iecc.com)
28 Jan 2005 04:45:26 -0000

In article <telecom24.39.18@telecom-digest.org> you write:

>> America has the best mobile telephone calling rates and plans in the
>> world, except maybe for Canada.

>> For example, for $30/mo I get a package that includes more calls than
>> I ever make, both incoming and outgoing, and I can call anywhere in
>> the country at no charge.

> It's obviously not at no charge, You've already prepaid the minutes.

Well, sure. It's no incremental charge.

> The reality is that most Europeans have a much cheaper service. The
> monthly fee can be as low as $2 for low volume use and $4 for higher
> volume use. Per minute charges can be around the $0.06-0.08 mark (in
> todays unfavorable exchange rates).

Except for the poor schnooks who try to call you who get ripped off
for more like 25 to 30 cpm. And as you note, I can call a lot farther
with my bundled minutes than you can for 8 cents. Really low volume
users can get prepaid phones here just like they can in Europe.

> I also think that the knowledge that you are depleting somebody's
> minutes when you call them (a bit like a collect call would charge the
> called party), makes people hesitant to call someone on their cell,

Ah, but increasingly the caller doesn't know whether he's calling a
mobile, since people can and do port numbers back and forth and
forward calls from one to the other. For example, if you call my
business VoIP line, the call rings simultaneously on my mobile and if
I'm away from the office, I get it that way. I don't care if people
call my cell, I have enough bundled minutes that their calls don't
cost me anything.

> Finally either billing system is certainly a legitimate option which
> came out of the particular regulatory (and to a lesser extent
> technical) realities of each market.

Actually, here it was as least as much technical as regulatory. We
have fixed length numbers and we didn't have enough unused area codes
to overlay separate mobile codes on the whole country.

> But I must say, I would rather pay for what I use as opposed to
> pre-paying for what I might use.

History suggests that you are in the minority; people consistently
prefer simple predictable prices to unpredictable ones, even if the
unpredictable ones are on average lower. See the papers that Andy
Odlyzko has done on communication pricing.

R's,

John

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