International roaming costs: how to avoid bill shock

International roaming costs can turn a small amount of phone use abroad into a bill of hundreds or thousands of dollars. Roaming means your normal Australian phone works on a foreign network, and your home provider bills you for it at much higher rates. A little planning before you fly keeps the bill small.

Sources for this section: Parliament of Australia, House Standing Committee on Communications, Phoning home: Inquiry into International Mobile Roaming, chapter 1.

How roaming is charged

Each service is charged in its own way. The parliamentary committee that looked at roaming in 2009 set them out like this.

• Calls you make: you pay a per-minute rate that depends on the country you are in.
• Calls you receive: the caller pays their usual price, but you also pay a per-minute rate for answering. At home, receiving a call is free.
• Text messages you send: you pay a set price for each message, usually per 160 characters. A longer text counts as two or more.
• Text messages you receive: usually free.
• Data: you pay either for the amount you download and upload, or a fixed fee with a usage limit.

The committee found that the general rules behind these deals come from the GSM Association, an industry body. That is why the best protection is to be informed before you go.

Sources for this section: Parliament of Australia, Phoning home, chapters 1 and 2.

Why the bills climb

Roaming is priced far above the cost of providing it. A 2008 report by KPMG for the Department of Broadband, Communications and the Digital Economy put the average retail price of a roamed call at $2.75 a minute. It estimated the real cost at $0.46 a minute.

Data is where the shock is biggest. One Australian blogger, writing in May 2010 and citing a report in The Australian, gave roaming data rates of $5.12 to $20.48 per megabyte for postpaid customers. For prepaid customers the range was $15.36 to $51.20 per megabyte. On those rates, 100 MB of light email use would cost between $1,536 and $5,120 overseas. These are one writer's figures, and rates vary by provider and country, so always read your own provider's price list.

Sources for this section: Parliament of Australia, Phoning home, chapter 3; Kelvin Eldridge, JustLocal blog, Be careful of data charges when travelling overseas, 26 May 2010.

Where the surprises hide

Most bill shock comes from things people do not know they are paying for. The committee and the ombudsman gave two clear examples.

• Voicemail: a traveller who gets a call, lets it go to voicemail, listens to the message and rings back is effectively paying for four international calls.
• Data outside your deal: one customer in a Telecommunications Industry Ombudsman case bought a plan with home-style pricing for some countries. He used data in the UK and Ireland at moderate cost. He then went to France, which was not covered, and ran up a debt of several thousand dollars in a few days.

There is also a timing problem. For postpaid phones, your provider can wait for billing details from the overseas network, so the bill can arrive weeks after you land home. The committee was told that near real-time cost information for postpaid customers was at least two years away. Prepaid phones are different. The committee noted that real-time cost information is already available to prepaid customers.

Sources for this section: Parliament of Australia, Phoning home, chapters 2 and 4 (voicemail example and ombudsman case in chapter 2).

Five ways to cut the bill

1. Read the price list first. The industry body AMTA told the committee that Australian providers list indicative roaming prices on their websites, in Australian dollars, for each service. Where a provider has deals with more than one overseas network in a country, it also gives the cost for each, so you can pick.
2. Turn off data roaming. Switch data roaming off in the phone settings before you land, and turn it on only when you choose to.
3. Skip the voicemail loop. Ask your provider how to divert or switch off voicemail while you travel, and tell friends to text you.
4. Use other ways to connect. The committee looked at international calling cards, text messages, local networks, email and hotel phones. It found none matches a roaming phone for convenience, but email is a close alternative at a fraction of the cost. The blogger suggested buying credit for hotel wireless internet or using internet cafes, so you know the price before you start.
5. Think prepaid. The blogger preferred prepaid, because overspending usually only uses up your credit. The committee also described buying a local SIM card in the country you visit and putting it in your phone. Ask your provider before you leave whether your phone will accept another SIM card.

Sources for this section: Parliament of Australia, Phoning home, chapters 1, 4 and 5; Kelvin Eldridge, JustLocal blog, 26 May 2010.

Where the rules stand

Australia does not cap roaming prices. In 2009 the committee found the case against retail price controls sound. It suggested a minimum standard for the information that providers give travellers. That standard would cover countries, provider choices, prices, activation charges, and the fact that receiving calls and voicemail both cost money. The committee said providers should offer it on websites, in print, in shops and by phone. It recommended that the regulator, ACMA, bring industry together to develop the standard. The committee said it could not bind the private sector.

Roaming remains in the news. On 26 May 2010 the Australian and New Zealand governments released a joint discussion paper on trans-Tasman roaming. It said there was some concern about high prices and that price transparency and consumer awareness were low. Public submissions closed on 2 July 2010.

Sources for this section: Parliament of Australia, Phoning home, chapters 1 and 4; iTnews, Feds kick off mobile roaming discussion, 27 May 2010.

A simple checklist before you fly

• Find your provider's roaming price list for each country you will visit.
• Ask whether your plan has any roaming deal, and which countries it covers.
• Turn data roaming off and switch off background email fetching.
• Sort out voicemail and tell people to text you.

Prices and rules change, so check your provider's current price list before you travel.

Sources for this section: Parliament of Australia, Phoning home, chapters 1 and 4.

Sources

1. Parliament of Australia, Phoning home: Inquiry into International Mobile Roaming, chapter 1 (tabled 19 March 2009): aphref.aph.gov.au
2. Parliament of Australia, Phoning home, chapter 2: aphref.aph.gov.au
3. Parliament of Australia, Phoning home, chapter 3: aphref.aph.gov.au
4. Parliament of Australia, Phoning home, chapter 4: aphref.aph.gov.au
5. Parliament of Australia, Phoning home, chapter 5: aphref.aph.gov.au
6. iTnews, Feds kick off mobile roaming discussion, 27 May 2010: itnews.com.au
7. Kelvin Eldridge, JustLocal blog, Be careful of data charges when travelling overseas, 26 May 2010: justlocal.blogspot.com