Why on earth is roaming so expensive?

Posted on Posted in Articles, Cost Savings, Misc, Telecom Expense Management

Most people know that international roaming can be expensive, but just how expensive can a phone bill get?  In 2010 we found out as Canadians everywhere got caught up in hockey madness. On the final day of the Vancouver Olympic Games, the Canadian men defeated Team USA to win the gold medal as one man (let’s call him Joe) watched the action from his hotel room in Mexico. Unable to find the game on live TV, and not wanting to pay the $20 daily fee his resort wanted to charge for mediocre WiFi, Joe decided to stream the game in high definition using the USB modem his employer has given him to help him keep in touch with the office while he was vacationing. While many of us know intuitively know this was a bad decision on his part, few would have predicted what this international roaming data usage would cost: almost $275,000! For that amount, one could have purchased a vacation package to Vancouver and two rink-side seats to watch Sidney Crosby’s winning goal live, or perhaps a very nice car. Because the device was on a corporate account, the man’s employer was liable for these charges.

In an effort to prevent public outrage over the issue, the $275,000 bill was quickly reduced by the Canadian wireless carrier to just over $5,000, their actual cost to the Mexican service provider for the data usage incurred. While the corporate customer was able to escape relatively unscathed, the incident raised questions over the huge retail markup on data roaming and the ‘bill shock’ resulting from this practice. In 2010 the standard data roaming rate for Canadian users traveling to Mexico was $51.20 per MB, and today $20 per MB is considered on the high end. However as data roaming rates drop, wireless users are using larger amounts of data both at home and abroad meaning roaming charges can still easily reach into the thousands for one user on a one week trip. The Canadian government has recently introduced legislation to limit the amount that wireless companies can charge for international roaming, however, these protections are for consumer clients only, leaving corporate clients at risk.

So what should be done to avoid these astronomical roaming costs? It’s important to have a strategy in place for international users, particularly those who travel regularly outside of North America. Your Avema account manager can discuss how to mix the below options to minimize your roaming bills.

  1. Carrier plans and features. For users who travel regularly, it is often best to apply ongoing features that never expire to provide continuous coverage. For infrequent travelers, it’s usually best to add one-time travel packs. It is easy to use more than the relatively small amount of data included in these travel packs, so monitoring data usage and minimizing data-intensive activities like media streaming is recommended.
  2. International SIM. International SIM cards offer service across many countries using a single SIM. Cheaper than standard roaming rates, this option also avoids the need to purchase/change SIM cards when changing countries. International SIMs are available from companies like iRoam, KnowRoaming, and GoSIM. Ask your Avema account manager which option is best for your company.
  3. Local SIM. For travelers staying in one country for most of their trip, getting a local SIM is usually the best option. This option is usually the cheapest by a wide margin, but it does require that a SIM card be purchased and provisioned upon arrival in the destination country. Using either an international SIM or a local SIM will require an unlocked phone.

While roaming can be expensive, data applications for city maps and language translators can be essential tools on an international trip. Ask your Avema account manager about how your company can keep roaming costs at a minimum while still utilizing all of the functionality that we have come to expect from mobile devices.


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