Rebtel Blog

Rebtel research: Cheaper to fly than to call

We have recently commissioned some research to understand how much UK mobile operators mark-up their prices. The results were incredible - so much so, that when we showed our results to the media, the News of the World couldn’t wait to report about it. Extracts of this article are below:

SKY-HIGH international mobile phone charges can make it cheaper to FLY abroad for a chat with a pal than to call them up.

Industry insiders have told the News of the World that UK customers are charged up to 50 TIMES what the networks actually pay for international mobile-to-mobile call time.

On average the mark-up is a whopping 1,174 per cent.

The revelation comes in the week the EU pledged to cut the costs of using mobiles abroad.

You could fly to Vitoria, near Bilbao, in Spain, for just £10 all-in with Ryanair—£8 CHEAPER than a one-hour call with ‘3′ at 30p a minute. It also costs a tenner to fly to Wroclaw in Poland, but a one-hour Orange call would again cost £18.

Add that kind of mark-up to a £2.50 pint of lager and it would cost you £29.35. The mark-up is calculated by comparing what it costs networks to buy minutes with the amount customers are charged.

A minute of mobile-to-mobile calling from the UK to places like Spain and Portugal costs networks between 7 and 8p a minute to buy. But ‘3′ charge 30p a minute and 02 charge 17p. It’s a similar story for other countries.

A minute’s call time from the UK to the US can cost networks just 0.6p, but ‘3′ will charge 30p—a mark up of 5,000 PER CENT.

A spokesman for ‘3′ did not deny the figures but insisted they had worked to bring down the cost of international calls. An O2 spokesman said lower rates for international calls were available. Orange said: “These details are commercially sensitive.”

Our view is quite simple.

The mobile operators have been ripping off British customers for far too long.

They have created a myth that the further a call has to travel, the more it has to cost. This is simply not the case anymore.

A mark-up of over 1000% cannot be justified in any market. It’s hardly surprising that people have started to refer to GSM as Get Screwed Monthly.

Rebtel believe that international calls should not cost more than a few pence…not a few pounds. In an age of cut-price everything else, it’s time to dispel the myth that calling international from your mobile means breaking the bank.

Technorati Tags: VoIP, mVoIP, Rebtel, Mobile, News of the World, Orange, Three, O2, Vodafone, Disruption