Telco drops global roaming rates 90%, reveals truth about rort

A New Zealand telco has slashed its data roaming rates to Australia, the UK and the USA by 90 per cent.

It says its ability to negotiate better rates with mobile networks overseas shows that telcos are lying when they say they can't negotiate cheaper rates for their customers.

2Degrees had been charging NZ$30/MB (A$22) for data roaming, but will now charge only NZ$2.50/MB (A$1.85) in Australia, the UK and the US, or NZ$1/MB ($A0.75) if a customer pre-pays their global roaming.

Telecommunications Users Association's Paul Brislen (who selflessly ran up an $1,800 bill for global roaming recently to raise publicity for the problem) points out how ridiculous global roaming rates are in one succinct statement:

"Imagine if it was coffee - $4 for a latte in Auckland but $800 in Sydney," he told New Zealand's National Business Review. "There is no reason why the rates should be that high."

Brislen is a former manager for Vodafone.

Australia's number two telco, Optus, was caught out last week charging more than five times as much as Vodafone for data roaming.

It promptly responded to Australian Business Traveller's analysis of its rates (which haven't moved in a decade) saying it planned to lower its rates at some point down the track.

Telcos have consistently told government enquiries into high global roaming rates that they lack the bargaining power to demand cheaper rates for their customers from overseas mobile networks.

A new joint government enquiry between the Australian and New Zealand is about to probe the truth of these claims once again.

However, telco industry insiders who have spoken to Australian Business Traveller say the truth is that the profit margins on global roaming are enormous and there is no incentive for telcos to drop their prices.

That lack of incentive is rapidly diminishing, though, with better value global roaming products coming onto the market.

UK telco Tru recently launched in Australia, offering SIM cards with a normal Australian mobile phone number that provide data at 15c/MB in the UK, and 35c/MB in the USA, and call rates back to Australia or within those countries cheaper than normal mobile phone calls within Australia.

In Europe, a battery-powered 3G/Wi-Fi modem that provides internet access for up to five devices can be rented from a company called Droam for €65 (AUD$86) per month with a 1,000MB usage allowance. (the same would cost $20,000 at Optus' data roaming rates.)

A global roaming SIM card called MaxRoam can provide data access for smartphones and laptops at €0.70 (AUD$0.93) per megabyte in Europe - less than a twentieth of the cost of Optus global roaming. It says it will cut those rates even further at the end of May.

In 11 Asian countries, a prepaid data SIM card called Bridge Alliance DataRoam Unlimited can provide unlimited internet access for a flat daily fee.

danwarne