China to scrap domestic roaming fees

By:
James Pearce
Published on:

Chinese operators will focus on other sources of revenue when they axe long-distance call charges and domestic roaming fees in October

China Mobile, China Unicom and China Telecom have announced plans to scrap domestic long-distance roaming charges later this year.

The three Chinese operators will stop charging each other for roaming from October, instead focussing on other sources of revenue such as cloud computing and big data, Reuters reported.

The fees, which are charged to customers who leave their local service area, range from 0.6 yuan ($0.08) to 0.8 yuan per minute, and generate as much as 10% of net profits for the operators.

Chinese premier Li Keqiang announced plans to end the practice of charging long-distance calls and domestic roaming fees to the 12th National People’s Congress on Sunday.

China Unicom GM Lu Yimin said it had cancelled domestic long-distance charges for subscribers who joined 1 January, and would cancel them altogether.

"We hope to innovate our business model, and upgrade products and services, and develop new businesses, such as cloud computing, big data and the internet of things to make up for the loss and offer better services," Lu added.

China Mobile president Li Yue admitted that scrapping the fees would prove challenging for the company.

The move follows GSMA chairman Sunil Mittal’s challenge to the industry to eliminate domestic roaming and international roaming fees altogether.

Speaking at this year’s Mobile World Congress, Mittal, who is also chairman of Indian operator Bharti Airtel, called on the entire industry to “to come together to kill the international roaming tariffs that are presently prevalent.”

In a statement on the announcement in China, Mittal said: “We are extremely delighted that GSMA's call to bring an end to domestic roaming fees has received resounding support from the leading operators in China, the largest telecom market in the world.

"The plan to eliminate domestic roaming fees will not just promote customer convenience by ending 'bill shocks' but help boost usage by customers through adoption of network technologies to augment productivity, innovation and economic growth. We are sure operators in other countries will take the cue from China's example to usher in similar initiatives, in the interest of the customers.”