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International Mobile Roaming Industry Standard – Regulation Impact Statement – Australian Communications and Media Authority

 On 3 July 2013, the Australian Communications and Media Authority (ACMA) announced a new International Mobile Roaming (IMR) Standard, which requires telecommunications providers of IMR services to implement certain measures over the next three years. These measures aim to reduce the incidence and impact of ‘Bill Shock’, that is, the occurrence of unexpectedly high bills for mobile devices arising from the use of IMR services. The Regulation Impact Statement (RIS) notes that Bill Shock can arise because of the significant differences that can exist between both the types of charges and the rate of charges when a mobile customer is overseas, compared to domestic use. In particular, the charges relating to data usage are identified as the major source of IMR Bill Shock. This appears related to the rapid take-up of mobile internet connected devices such as smart phones and tablets, as well as the increased difficulty consumers face in understanding and estimating their data usage. It is important to note that the major providers have been taking action in recent times that would be expected to reduce IMR Bill Shock, including attempts to better inform customers about the costs of IMR. The RIS considered three options: minimum consumer awareness measures as per a Ministerial Direction; extensive requirements for alerts and spend management tools; and, (the implemented standard) a paring back of the extensive requirements option with a focus on data usage. The implemented standard is expected to achieve similar benefits to the extensive requirements option, but at a significantly lower cost due to being better targeted at the underlying causes of Bill Shock. The minimum measures option has lower costs than the implemented standard but was expected to have only marginal benefits due to the narrowing gap between it and existing industry practice. Overall, the RIS concludes that it is likely that the implemented standard would result in a relatively low but positive net benefit. This option was partly shaped by the extensive consultation the ACMA undertook on this issue. However, the analysis presented in the RIS also suggests that the estimated implementation costs are likely to result in some smaller businesses ceasing their participation in the roaming market. This is expected to reduce consumer choice and competition in the IMR market by raising barriers to entry. The RIS was prepared by the ACMA and assessed as adequate by the Office of Best Practice Regulation.