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ITU cost model and methodology to assist national regulatory authorities to engage with international mobile roaming

Simon Forge (SCF Associates Ltd, Princes Risborough, Buckinghamshire, UK)
Lara Srivastava (ITU, Geneva, Switzerland)

Digital Policy, Regulation and Governance

ISSN: 2398-5038

Article publication date: 12 March 2018

177

Abstract

Purpose

Tariffs for international mobile roaming (IMR) are often viewed by governments as an additional tax on international trade and on tourism. IMR customer bills may appear to be arbitrary and sometimes excessive. The purpose of this paper is therefore to set out a pragmatic approach to assessing international charges for mobile roaming, making use of a realistic cost model of the international roaming process and its cost elements, at a level that is useful to regulatory authorities and operators.

Design/methodology/approach

The discussion presented is based on industry practices for handling voice calls and data sessions with the mobile network operators (MNOs) business model, based on industry sources. The basic mechanisms use two common constructs from business analysis – business processes and use-cases – to provide a simplified form of activity-based costing. This provides a model suitable for national regulatory authorities to move towards cost-based IMR tariffs.

Findings

Using a perspective on costs based on a bottom-up survey procedure for elucidating the key information, the paper presents the cost elements for the various IMR network components and business processes, with an approach suitable for analysing both wholesale and retail pricing.

Research limitations/implications

The method is specifically designed to overcome the key problem of such approaches, the limitations set by differences in network technologies, network topology, operational scale and the engineering, as well as MNO business model and accounting practices, which otherwise would preclude the method presented here from being vendor neutral.

Practical implications

Vendor and network engineering neutrality implies the approach can be used to compare different MNOs in terms of the validity of their IMR charges and whether they are cost based.

Social implications

Impacts on society of so-called “bill-shock” have become quite common, increasingly for data sessions. The cost model presented here was developed with the intention of improving the accountability and transparency of the mobile roaming market. It thus assists in the introduction of cost-based tariffs over an economic region, such the European Union.

Originality/value

The paper examines the practical implications of building large-scale cost models for assessing the real IMR costs, a modelling exercise that has not been seen elsewhere in terms of its approach and neutrality as to MNO structure and assets.

Keywords

Citation

Forge, S. and Srivastava, L. (2018), "ITU cost model and methodology to assist national regulatory authorities to engage with international mobile roaming", Digital Policy, Regulation and Governance, Vol. 20 No. 2, pp. 125-148. https://doi.org/10.1108/DPRG-06-2017-0033

Publisher

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Emerald Publishing Limited

Copyright © 2018, Emerald Publishing Limited

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