End of roaming fees to have broad benefits

A decision by the country’s three largest telecom carriers to scrap domestic longdistance fees and roaming fees could benefit millions of Chinese mobile users, while having a relatively limited impact on the companies’ profits.

As part of the central government’s drive to expand and upgrade mobile and Internet services across the country and reduce the cost burden on small and medium-sized enterprises (SMEs), China Mobile, China Telecom and China Unicom will cancel long-distance and roaming fees for all users and reduce services fees for SMEs starting on Friday.

“I received a text message from China Mobile this morning that said that starting [September 1] there will be no more long-distance and roaming fees. At first I thought it was just a rumor. But it’s really great news,” Yu Fang, a resident of Liangshan Yi Autonomous Prefecture in Southwest China’s Sichuan Province, told the Global Times on Thursday.

Yu had been spending “a lot of money” on roaming fees after she moved from the neighboring Garze Tibetan Autonomous Prefecture, also in Sichuan. “I have to keep my old cell number because my WeChat and many other things are connected to that number. But it was very expensive to make phone calls and use data on that number,” she said.

But many other users were indifferent about the cancelation.

“Given today’s advanced mobile Internet, [the cancelation] doesn’t have a big impact on many people anymore,” Lin Zhuoxi, a native of South China’s Guangdong Province who now lives in Beijing, told the Global Times.

Lin said that most people now use WeChat and other Internet-based communication platforms, rather than making phone calls, so ending the fees won’t have a big impact.

A Beijing resident, who gave the surname of Tu, also said that she didn’t “care too much” about the long-distance fee and roaming fee because she only uses it occasionally when she is out of town.

Fu Liang, a Beijing-based independent telecom industry analyst, said the cancelation will affect the millions of people who still use the second-generation networks.

The “cancelation of the roaming fee won’t benefit fourth-generation [4G] network users, but it will benefit those lowerend users,” Fu wrote in a note sent to the Global Times on Thursday.

The three carriers had already canceled long-distance and roaming fees for 3G and 4G users, he added.

At the end of July, there were 1.37 billion mobile accounts in China, of which about 1.06 billion were 3G and 4G users, leaving about 310 million 2G and other users, according to a report on china.com.cn on Thursday. The latter groups will directly benefit from the cancelation, the report noted.

The cancelation will not bite into revenue for the three carriers, according to Fu. “Revenue from long-distance and roaming fee charges is not a big part of carriers’ telecom business,” he said.

The latest earnings reports show the carriers generating more revenue from their 4G services. For instance, China Mobile generated more than half of its total revenue of 388.9 billion yuan ($58.96 billion) from its 594 million 4G users in the first half.

The three carriers will also reduce the cost of Internet services to SMEs and cut fees for international long-distance services starting Friday, according to a post on gov.cn, the official website of the central government on Thursday.