Roaming Price Hike for Non-Europeans

Roaming price levels for non-Europeans traveling in Europe are likely to rise following the European Parliament’s approval of new retail price controls this week. A number of European mobile operators have told research firm Informa Telecoms & Media that they will increase the wholesale prices (IOTs) that they charge non-European operators whose customers roam onto their networks. This is to compensate for the loss of revenues resulting from the new European price caps. On average, retail prices are set 20 percent above the wholesale rate.

Until now, operators have been free to set their own wholesale prices for roaming services. Some operators set much higher wholesale price levels than others. It is quite normal for two operators on a single route — for example between Germany and India — to charge each other different prices for calls made by their customers on each others’ networks.

“Some of the highest wholesale prices are levied by operators in developing markets for whom inbound roaming is a key source of income,” said Informa Telecoms & Media’s Mark Newman. “In India, for example, wholesale roaming prices are up to 30 times more expensive than the retail price that Indian operators charge their own customers for making the same call.”

But faced with lower revenues from their European roaming business, operators in Europe will now start to seek reciprocity in wholesale price arrangements. And if operators outside Europe refuse to reduce their wholesale roaming charges, the European operators will increase their own wholesale charges. These higher charges will be passed on to non-European customers.

“What we are beginning to see here is the emergence of a two-tier market for roaming services,” said Newman. “With the new price caps and the emergence of pan-European groups such as Vodafone, Telefonica/O2 and Orange, Europe is going to start resembling a single market in terms of retail prices. Countries such as the USA and India already have national roaming markets where people can make calls on other operators’ networks without incurring higher charges. The same is also beginning to happen in Greater China. However, when people want to use their phones outside of their countries or regional groupings they will pay a substantial premium.”

PCs With Integrated Online Services

As a part of their continued collaboration, Microsoft Corp. and Lenovo announced a global agreement to pre-load Windows Live services on Lenovo PCs worldwide including ThinkPad notebooks, ThinkCentre desktops and Lenovo 3000 PCs. In the coming weeks, Lenovo will be the first PC maker to offer its customers worldwide with immediate access to the Microsoft Live.com portal (http://www.live.com) and Windows Live Toolbar (http://toolbar.live.com).

With Live.com, customers can easily customize their home page content, create multiple pages based on their interests and add their favorite content from millions of sources of information. The Windows Live Toolbar gives consumers one-click access to Live Search, which enables category searches such as Web, news, images and immersive maps to help them find what they are looking for.

Component Orders Take Small Dip

Electronic component orders took a dip in March after an upturn in February, leading to a relatively flat first quarter, according to the four-to-five-week index compiled by the Electronic Components, Assemblies & Materials Association (ECA). The 12-month average, which compares results to the previous year, remained flat as well.

“The index is behaving the same as last year, so this is no surprise,” says Bob Willis, ECA president. “We are seeing the same trends, except with the possibility of a bit slower growth this year compared to 2006.”

Sebastien Ropside of DECISION predicted a worldwide slowdown in electronics production during his session at CARTS USA 2007 late last month in Albuquerque, New Mexico. According to Ropside, electronics production growth will decelerate in concert with the worldwide economy, slowing to 7.8 percent this year from 8.6 percent last year, and settling at 6.1 percent for the five-year period between 2006 and 2011.