The PhoneBoy Blog


Simplifying Telecom, Mobile Phones, Gadgets, and More!

Why The U.S. Has More Minutes Of Use Than Others

It boils down to a simple equation: minutes are cheaper here. Not just on mobile phones, but on landlines, too.

One of the holdovers from the days of Ma Bell in both the U.S. and Canada was the concept of free “local” calling. I have to suspect that automated switching made local calls, in effect, free. Billing long distance calls in the early days of the Bell System required a human operator to even connect the call, much less log it for billing. Local calls required no such effort.

This custom has survived even to present-day. When mobile phones entered the scene, the FCC basically said that mobile phones had to exist within the same numbering space as landline phones. Various attempts by implementing such a system in the U.S. have been struck down by the courts. Conversely, it does not cost the caller any extra money to call a mobile phone.

While some people view the wireless-subscriber-pays model as unfair and ridiculous, it does have some interesting side effects:

  • Telemarketing to a mobile phone is illegal, much like sending junk faxes are illegal. The recipient bares a cost to receive those calls, which is the reasoning for making these calls illegal.
  • Market pressures have forced the cost-per-minute for wireless calls–both inbound and outbound–down. It’s now possible to get flat-rate nationwide service through all of the major carriers in the U.S. for around $100 a month, or you can get a ridiculous amount of minutes in bundles for less per month.
  • People use mobiles and landlines interchangeably in North America. Because there is no cost differential, people don’t even think twice about calling a mobile phone! This lack of cost-differential between landline and mobile phones delayed the desire for SMS in North America–calling was easier and just as cheap!

In almost all European countries, it costs more to call a mobile phone from a landline–substantially more! In fact, just looking at the rate sheet for voip.com for the UK, the cost of a call to a UK mobile can vary from 5.6 cents a minute to 33.5 cents a minute! Your carrier may charge you a different rate, but when you compare this to calling a UK landline, which can cost between 1.2 and 1.6 cents a minute, there’s clearly a substantial difference in cost–one that is not entirely justified!

What the European mobile network operators have done is essentially balkanized the mobile part of the telephony system with a higher cost structure. As a result, people don’t make calls nearly as much in Europe. Text messages are far cheaper.

Here’s a novel concept, European mobile operators. Lower your inbound call rate if you want to increase mobile usage. Bring your charges down to the same level as the landline!

Am I right? Which do you think is better, calling party pays or wireless subscriber pays? Leave your thoughts in the comments.


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