Say goodbye to data "roaming" fees: 10 questions, everything you want to know is here

Recently, the three operators have successively issued announcements, announcing that starting from July 1, 2018, the data "roaming" fee will be cancelled, and the general data of new and old mobile phone users in the province will be upgraded to domestic data (excluding Hong Kong, Macau and Taiwan data). The era of domestic data roaming fees is coming to an end. This is also another major benefit to the people after the three major telecom operators in my country completely cancelled domestic long-distance charges and roaming charges for mobile phones on September 1 last year. What impact will the cancellation of data "roaming" fees have on users, enterprises and society? Let me talk to you about the things about mobile data "roaming"...

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1. Why do I incur roaming charges?

Liu Liwen, an engineer at the Policy and Economic Research Institute of the China Academy of Information and Communications Technology, told reporters that there are two main reasons why basic telecommunications companies launched traffic that is limited to local use: On the one hand, my country's telecommunications companies conduct assessment and management by province or even city, and provincial or city companies need to settle accounts with each other. No matter where users go online, the fees are paid to the local telecommunications company. However, if users go online outside the local area, the local telecommunications company will count the traffic consumed by the users and require the local telecommunications company to pay the corresponding settlement fees. Therefore, in order to achieve performance, city companies will prefer users to use traffic locally.

On the other hand, most of the user traffic counted by telecom companies is used locally, but the network resources of enterprises in different regions are uneven, and traffic consumption also varies. Therefore, in the context of fierce market competition, some provincial or municipal companies of operators with less traffic consumption sell or give away traffic at low prices to attract users and cultivate users' traffic usage habits.

The introduction of this local-only traffic plan provides users with more choices and meets their differentiated needs. It also brings benefits to users because of its low price, which greatly releases user demand. According to statistics, the DOU (average mobile Internet access traffic per household) in May this year reached 3.97GB, a year-on-year increase of 169.3%.

2. When is the right time to cancel roaming charges?

From an international perspective, the European Union abolished international mobile roaming charges between members in June 2017, which also included cross-border data roaming charges; mobile operators in other major countries such as the United States, Canada, South Korea, Singapore, New Zealand and other countries do not distinguish between national and local traffic.

In China, with the development of mobile Internet, the demand for mobile data services has far exceeded that for voice services, and there is a trend of continuous growth. Liu Liwen said that after more than ten years of reduction, traditional voice charges have reached the lowest level in the world. Against this background, after the cancellation of domestic long-distance and roaming charges for mobile phones, data traffic charges and the charging model that distinguishes between national and local charges have become a new hot spot of social concern. In this context, focusing on solving the traffic charges that users are most concerned about and allowing the masses and enterprises to benefit is a concrete manifestation of implementing the people-centered development concept.

3. What preparations have operators made?

On March 5 this year, Premier Li Keqiang proposed to cancel the data "roaming" fee when delivering the government work report at the first session of the 13th National People's Congress. The data "roaming" fee will be canceled as scheduled on July 1 this year.

Some customers don't understand why it takes nearly four months. What work and preparations did the operators make during this period?

Industry technical experts told reporters that my country has a large number of mobile phone users, a large number of packages, and many supporting systems. This work involves complex business and system transformation, and it is not easy to complete it in less than 4 months.

A relevant person in charge of China Mobile told reporters that China Mobile's customers will benefit from this operation, which is about 400 million. In order to implement the national requirements for the cancellation of data roaming fees, China Mobile's Information Technology Center organized the IT system departments of 31 provincial companies across the country to sort out about 50,160 packages, transform 620 provincial systems, and complete a total of about 120,000 man-days of work.

To ensure accurate billing, testing is required after the system transformation is completed. About one month should be reserved to verify the accuracy of billing, invoices, and detailed invoices.

So far, the transformation and testing of all provincial companies has been completed, with a 100% pass rate. At present, the Information Technology Center is re-checking the provincial companies and the first-level system according to the transformation situation of each province, checking for deficiencies and filling in gaps, and striving to achieve 360-degree transformation without blind spots. Ensure that all functions are online on July 1st according to the time node.

A relevant person in charge of China Telecom said that they have completed a comprehensive review of the existing sales products in the entire network, and have uniformly upgraded local traffic sales products to national traffic principles. They have formulated business change plans and business rules one by one, reconfigured and adjusted the parameters of sales products containing traffic in the system, and conducted tests; the IT side has implemented system platform transformation and joint debugging tests; the customer service side has completed the formulation and distribution of customer service response caliber, announcements, SMS templates and customer service scripts, and the training of customer service personnel.

At the same time, the promotion of the cancellation of data "roaming fees" is being organized and implemented in various channels, and sales staff are being trained. China Telecom's cancellation of data "roaming fees" is expected to benefit more than 200 million users.

A relevant person in charge of China Unicom said that this work involves about 180 million users, nearly 150,000 tariff products, and more than 160 systems.

The group headquarters and provincial branches have set up special working groups respectively, and relevant departments such as marketing, government and enterprises, channels, e-commerce, finance, customer service, and information technology have coordinated and cooperated, going all out and working overtime to ensure that all front- and back-end tasks are carried out in a solid manner and to minimize the time for each link.

The information technology department has fully completed the transformation work including configuration of multi-system products such as cBSS, BSS and OCS, single system testing and multi-system joint debugging testing.

All departments at the front end of the market have completed the sorting of packages for the public, government and enterprise, and the Internet, as well as the adjustment of relevant business specifications. The marketing, channel, and service departments have uniformly compiled and issued customer announcements, training courseware, customer service documents, etc., and completed on-site training for a total of about 30,000 front-line personnel and customer service representatives in physical channels.

The relevant persons in charge of the three operators also hope to express their gratitude to our customers for their understanding, support and patience through this newspaper.

4. Which groups will benefit most?

People who travel to other provinces for business trips, as well as students, office workers, and migrant workers who return home during holidays will benefit the most. Customers who have already applied for a nationwide large-data package can also choose a package that is more suitable for their situation according to their needs. In this way, the beneficiaries of the cancellation of data roaming fees cover a very wide range of people.

In the past, many users who signed up for large-volume data packages within the province or locally were very generous in using data locally, but became "poor" once they went to other places. This big gap between local and other places actually affects the user experience, because people have formed the habit of using data anytime and anywhere. If they don't use it or use it sparingly, it's "difficult to go from extravagance to frugality", which is really unpleasant.

Many netizens left messages saying that the cancellation of data "roaming" fees made them very happy: "No longer worried about running out of data when traveling anywhere in the future." "Finally, I don't have to buy domestic data packages when I go home in the future!"

5. Will this result in a reduction in revenue for operators?

In the short term, it does have a direct impact on the revenue of telecom operators, and a reduction in revenue is inevitable. Dr. Zuo Kairui, an expert at the China Academy of Information and Communications Technology, predicts that the full cancellation of data "roaming" fees may not significantly reduce the ARPU of operators in the short term, but it will significantly affect the future growth space of ARPU.

The relevant person in charge of the operator told reporters that the information network has become a strategic infrastructure to support the country's economic and social development. As a key measure to promote network evolution and upgrading and application popularization, network speed increase and fee reduction are of great significance to economic development, improvement of people's livelihood, social progress and strengthening of national strength. As a central enterprise, it is our unshirkable responsibility to do a good job in speed increase and fee reduction. Speed ​​increase and fee reduction will stimulate the growth of information consumption, promote entrepreneurship and employment, enhance the strength of the national information network, and create greater space for the healthy development of the entire industry. In the long run, telecommunications companies will also benefit.

6. What is the impact on social and economic development?

The cancellation of data roaming charges will bring obvious benefits to users and will also have a positive impact on social and economic development.

Liu Liwen said that my country has the largest mobile Internet user group in the world. Canceling mobile data "roaming" fees and lowering mobile charges can release the information consumption needs of this large group, further promote applications based on video and social networking, and drive rapid growth in consumption in other areas. It plays an important role in stimulating domestic demand, promoting employment and leading industrial upgrading, and brings basic and institutional dividends to digital content innovation of the entire mobile Internet.

This time, the government has put forward new requirements to expand WiFi coverage in public areas, reduce the cost of home broadband and corporate dedicated lines, and cancel data roaming fees. This means that my country's network infrastructure construction has entered a new era and will create greater dividends for the construction and development of Digital China.

7. How should operators deal with the situation where the volume of traffic increases but the revenue does not?

With the cancellation of roaming charges and the continuous reduction of traffic charges, the industry generally believes that the gap between the total volume of telecommunications business and business revenue will inevitably increase further. The increase in volume but not in revenue has become a curse in the current communications industry.

Data from the Ministry of Industry and Information Technology show that from January to May, my country's total telecommunications business volume reached 203.06 billion yuan, a year-on-year increase of 129.1%. The growth rate has maintained a steadily increasing trend, with the growth rate in May reaching 143.1%. The cumulative telecommunications business revenue reached 557.6 billion yuan, a year-on-year increase of only 4.2%, the lowest increase since 2016. The "scissors gap" between volume and revenue has further widened, and the trend of basic telecommunications companies increasing volume but not revenue has become more obvious.

Zuo Kairui analyzed that the main reason for the slowdown in the growth of telecom business revenue this year is that the growth rate of mobile data business revenue, which is the main source of telecom business revenue, has slowed down since last year, but still maintained an increase of more than 20%. However, at the beginning of this year, the growth rate of mobile data business revenue directly dropped to about 14%, which had a great impact on the growth of telecom business revenue. This objectively shows that my country's mobile phone users are basically saturated, and the new users are basically second card slot users.

In the future, if basic telecommunications companies want to achieve better development, they must accelerate the pace of transformation and find new business growth points as soon as possible. Liu Liwen said that based on international experience, there are four main directions.

• The first is to develop IoT users and expand the scale of connections.
• The second is to cooperate with content service providers based on broadband network resources to provide bundled services.
• The third is to accelerate digital transformation and develop new businesses such as cloud computing and big data.
• The fourth is to explore international markets, including extending the network to provide services in countries along the “Belt and Road”.

8. What is the effect of speed increase and fee reduction?

The cancellation of roaming charges is another achievement of telecom operators in implementing the national policy of increasing speed and reducing fees. In recent years, telecom operators have achieved visible results in increasing speed and reducing fees. Let the data speak for itself:

According to data from the Ministry of Industry and Information Technology, in the past three years, the average fixed broadband charges have dropped by 90%, and the average mobile data charges have dropped by 83.5%; since the implementation of the speed-up and fee-reduction program, the average cost for Chinese users to use 1GB of data has dropped from 139 yuan at the end of 2014 to 23 yuan at the end of 2017.

While prices are falling, Internet speeds are increasing. According to the 19th China Broadband Speed ​​Status Report (Q1 2018) released by the Broadband Development Alliance, in the first quarter of 2018, the average download speed of my country's mobile broadband users using 4G networks to access the Internet reached 19.12Mbit/s, a year-on-year increase of 54.3%.

Data released by the Broadband Development Alliance show that the average available download speed of my country's fixed broadband users has entered the ranks of the fastest countries in the world; data released by the International Telecommunication Union show that my country's fixed broadband and mobile broadband prices are at a medium-low level globally.

9. Why is there still complaints about the increase in speed and reduction in fees?

Faced with the news of canceling data "roaming" fees, there are still some users complaining and expressing doubts.

The main reason is that enterprises and users have different perspectives and different understandings of "fee reduction". Users understand fee reduction as a direct reduction in communication expenses, while enterprises understand fee reduction as a reduction in the unit price of related services.

Enterprises have indeed reduced fees, and the unit price of various services has dropped significantly, but user usage, such as traffic, has increased significantly. For example, data from the Ministry of Industry and Information Technology shows that in April 2015, the average monthly mobile Internet access traffic per household was only 302.2M, while in May this year, DOU (average mobile Internet access traffic per household) has reached 3.97GB. In just three years, the change is so great that it is equivalent to users going from eating simple meals to eating full banquets. Therefore, the monthly communication expenses of users have not been significantly reduced.

Some industry experts believe that the main contradiction in the current communications market is the conflict between users' demands for increased speed and reduced fees and operators' demands for revenue growth.

Users’ demands for faster speeds and lower fees are endless. Who doesn’t want low prices or even free services? However, as enterprises, especially listed companies, telecom operators also need to operate and develop and maintain profitability, and cannot reduce fees without limits. Recognizing this contradiction, we can understand users’ complaints and companies’ unwillingness.

10. Is there room for fee reduction?

After the announcement of the cancellation of data "roaming" fees on July 1, many users have been looking forward to and speculating on the next new fee reduction measures. Indeed, people's demand for speed increase and fee reduction is endless. How can basic telecommunications operators, which are currently experiencing sluggish growth, find more room for fee reduction?

Some industry insiders have called for the speed increase and fee reduction to be a joint action of the industry chain, not a solitary battle of operators. The speed increase and fee reduction is not a profit-making behavior of the communication operators themselves, but involves the coordination and consistency of the entire industry, including communication equipment manufacturing, information technology, and Internet applications.

Currently, operators have significantly reduced revenues and made concessions, but prices in related industries continue to rise. On the one hand, this has brought great pressure on the development of operators, such as the continuous increase in the prices of communication equipment; on the other hand, it has not given users a real sense of benefit, such as the continued significant increase in the prices of Internet applications.

Therefore, relevant national departments should formulate and issue a "speed increase and fee reduction" policy that is coordinated by the entire industry, rather than just the "speed increase and fee reduction" by telecommunications operators in isolation. Only in this way can users enjoy more benefits.