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US Cell Phone Plans Among World's Most Expensive

timothy posted more than 5 years ago | from the yes-but-we-have-cheap-gasoline dept.

Communications 827

Albanach writes "An OECD report published today has shown moderate cell phone users in the United States are paying some of the highest rates in the world . Average US plans cost $52.99 per month compared to an average of $10.95 in Finland. The full report is available only to subscribers, however Excel sheets of the raw data are available to download." (You'll find those Excel sheets — which open just fine in OpenOffice — on the summary page linked above.)

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Stupid prices (5, Interesting)

sopssa (1498795) | more than 5 years ago | (#29025467)

This is what I've always wondered, but learned from Slashdot comments. Why the hell mobile plans are so costly in US? I have the largest plan available from my phone company, 2500 minutes / 2500 sms per month and unlimited 3G internet. And that's still only 29 euro per month. And I did actually use that 3G internet connection for a month while waiting for adsl connection to be set up for my new apartment (hell, even running a server from it). No transfer limits or anything like that.

Yeah, mobile companies have extra costs from providing their infrastructure, but it just seems a lot what they ask in US. Sweden is mostly woods and non-urban areas too, so why is it done better here?

Maybe voice your opinion to the companies so they stop charging so much?

Re:Stupid prices (0)

gnick (1211984) | more than 5 years ago | (#29025595)

I'm in the US and mine's not nearly that high (it's really my wife's phone I rarely use it). It costs me $15US/month [net10.com] and I have unlimited texting [google.com] . Granted, that's only about 5 minutes of talk-time a day and I need a computer to send/receive texts unless I want to drop $.05 per send/receive, but it works for me.

Still, $10.95 sounds much better...

Missing the point (2, Insightful)

fiontan (671239) | more than 5 years ago | (#29025801)

You're comparing small apples to big apples. You can't claim your plan is cheaper (better value) just because it costs less. What would your plan cost if it included roughly 2500 minutes of talk time? What about if you add data? Unlimited data? Personally, I'll be moving back to Australia soon, and the cheapest I can find for data is AUD20 for 1Gb of data (roughly EUR10) per month.

Re:Missing the point (1)

gnick (1211984) | more than 5 years ago | (#29026003)

Not trying to go apples/oranges. My plan is cheaper (per month, not per minute) than most overall, but I never claimed that it was a better value and even quantified its serious limitations and caveated the statement by pointing out that the other plans are clearly "better" for most. I'm bugged by the high US prices too, which is why I minimize my cell-phone consumption. I just felt like pointing out that, even in the inflated US market, you don't have to pay those outrageous fees unless you're in some special circumstance.

Sure, some people have their own businesses and are on the road a lot - They have a good reason to pay for those outrageous plans. I was just sharing my personal experience - I'm usually around a computer, so texting and long distance are free thanks to Google Voice (formerly Grand Central). When I'm not near a computer, I don't need/want to be near a phone. So, I pay for basic land-line at home, $15/month cell, and the Corporate Gods pay for a line at work.

Obviously, YMMV.

Re:Stupid prices (0)

Anonymous Coward | more than 5 years ago | (#29025963)

Let me get this straight: your counter-argument that US cellphone service is inexpensive compared to EU unlimited data plans; is that you "only" pay 10c/minute and can't get data; whilst they must pay 2c/minute and get unlimited data? Am I reading this correctly?

Re:Stupid prices (1)

gnick (1211984) | more than 5 years ago | (#29026067)

No "counter-argument" implied. I'm just saying that if you're getting ripped off, stop buying. That's my solution in a number of arenas - The exception with the cell-phone market is that I still shell out $15/month instead of ignoring the industry completely like I do in some other areas.

Re:Stupid prices (5, Insightful)

EvilNTUser (573674) | more than 5 years ago | (#29025603)

It's because US carriers compete based on who has the iPhone and who has the Pre rather than network price/quality. Then users "buy" $800 devices for "$99" and make fun of uncrippled foreign cell phone brands because they're "so expensive", and have useless features like application downloads from Sourceforge.

Re:Stupid prices (-1, Flamebait)

Missing_dc (1074809) | more than 5 years ago | (#29025933)

You are very close. It is about what the users are willing to pay, for prestige or otherwise.

It is just like the pharma companies here Stateside. If they can spend $0.10 making 10 pills, and have the choice of selling 10 of them for $10 each to 10 men or 1 of them for $100 to one man, they will set $100 as the price point every time. even though 9 of those 10 men cannot possibly afford the $100 and therefore go without the needed medical care, the companies are in it for the money. Period.

Lets see a national health care plan realistically address that issue and pharma sell the meds for the price they do in India.

Re:Stupid prices (1)

gad_zuki! (70830) | more than 5 years ago | (#29025611)

All these companies need to pay for health insurance for all their full time employees. They dont get it via 20+% taxes like you do in Europe. So things cost more but you pay less taxes. I'll leave it up the reader which solution is best.

Re:Stupid prices (1, Flamebait)

cayenne8 (626475) | more than 5 years ago | (#29025679)

"All these companies need to pay for health insurance for all their full time employees. They dont get it via 20+% taxes like you do in Europe. So things cost more but you pay less taxes. I'll leave it up the reader which solution is best."

Unfortunately, it looks like we have a real chance of switching to just such coverage here in the US too. Yep, we'll get that extra 20+% taxation (I even hear they're bandying about a VAT tax here too, to go with the current income tax)...and yet, those prices the companies charge that you mentioned...will still exist and not come down. It will go to some profit, and I'm guessing overhead for more govt. paperwork and oversight.

Re:Stupid prices (5, Interesting)

AvitarX (172628) | more than 5 years ago | (#29025985)

We need a VAT in the US.

We need to tax the bad (over-spending/under-saving) and not the good (working and earning).

This is not true around the world (Germany for example could arguably be blamed for over-saving), but the US desperately needs to tax consumption rather than production.

in the US? (1)

commodoresloat (172735) | more than 5 years ago | (#29025995)

Uhh, where the hell do you guys live that you pay less than 20% income taxes?

Re:in the US? (5, Insightful)

radish (98371) | more than 5 years ago | (#29026097)

Seriously, I don't know what he's smoking. I pay roughly the same in income tax here in the US (once you add up federal, state and things like social security tax) as I did in the UK, but also get to pay for medical. Awesome!

Re:Stupid prices (1)

TheNucleon (865817) | more than 5 years ago | (#29025861)

I don't think this is it. I think we have been conditioned by the corporate overlords to accept the market prices without question. Our cell phone market, while not an explicit cartel, certainly has the feel of one. There is no meaningful competition and there are significant infrastructure barriers to entry. Also, there is certainly no meaningful regulation. So, the players can charge what they want, and we've just become used to it.

The whole "get the phone cheap and get locked in for 2 years" trick also works. However, to the layperson, buying an unlocked phone of the right technology and getting it activated is a pretty big barrier here, while it may not be that way elsewhere. Again, the quasi-cartel effect.

Re:Stupid prices (1)

MrHanky (141717) | more than 5 years ago | (#29026025)

Do you actually believe that yourself, or are you just trying to convince morons that socialised health care will have those consequences? I guess what I'm asking is: are you a moron, or do you just pander to them on the internets?

Re:Stupid prices (5, Funny)

0100010001010011 (652467) | more than 5 years ago | (#29025635)

That sounds pretty socialist there. I bet the Government even helped setup some towers.

Here in the good ole USA. We have Competition. None of that GSM only crap. We have true competition between carriers with CDMA, GSM, iDEN, etc. That way for any given area of good reception, there's 3x the number of towers. TRUE competition.

Re:Stupid prices (4, Informative)

MartinSchou (1360093) | more than 5 years ago | (#29025721)

True competition? Then why are your prices so high?

In a truly competitive market prices for comparable items converge towards a low price, as long as they aren't luxury items.

Look around in your supermarket. You can probably find ten different brands of bread, all costing roughly the same per unit of weight. The price will be fairly comparative to European prices (should be lower in the US as you have lower taxes and lower wages). That's true competition.

Not so in your cellphone market.

Re:Stupid prices (1)

gnick (1211984) | more than 5 years ago | (#29025857)

True competition? Then why are your prices so high?

Like GP said - We have 3x the number of towers. However that also implies that you'll see 3 towers within tens of feet of each other each erected by a different carrier with little shared traffic.

Re:Stupid prices (1)

CharlieHedlin (102121) | more than 5 years ago | (#29025925)

I think the poster was saying that in a market with such high capital requirements, the competition can lead to higher costs for all the providers, such that the converging lower price ends up being higher.

I don't think that is the problem (I think we don't have enough competition, and that the small handful of national carriers abuse their power and keep prices high), but there is a possible point to be made.

Re:Stupid prices (5, Insightful)

Amouth (879122) | more than 5 years ago | (#29025725)

What I'd be intrested to see. .instead of how much we all pay is.. how many customers are served Per tower - and how many towers vs area vs coverage.

You maay have the largest plan for sweeden.. but do you roam when you go to the UK? even if not.. all of Western Europe is ~1/3 the size of the US and has 1/3 MORE people

comes out to be:

Western Europe | 514 people/mi^2
United States | 86.5 people/mi^2

Basicly it takes 5 times the area to hold the same numebr of people - asume population was evenly spread (i know it isn't) it should cost 5 times as much to provide for the same number of people..

"Average US plans cost $52.99 per month compared to an average of $10.95 in Finland."

Assume the Finland price for all of western Europe - and we pay 5x the cost for something 5x as expensive to provide..

People don't realize how large the US is.. and that most plans now days there is no roaming from sea to sea.. thats alot of area to provide for..

Re:Stupid prices (0)

sopssa (1498795) | more than 5 years ago | (#29025819)

This argument doesn't work because all of the providers work per country. Europe is not a single country, and even the largest companies that work in multiple countries have greatly separated their companies per country.

Re:Stupid prices (5, Insightful)

realisticradical (969181) | more than 5 years ago | (#29026033)

That's exactly what Amouth was saying. European plans can be less expensive because the population is much denser and therefore easier to serve (fewer towers). Also since each company only needs to serve a single country customers aren't paying for free access all across Europe.

On the other hand I think US carriers are guilty of heavy upselling. If I live in a dense city in a dense area (Boston, New York, DC, etc) and do 99% of my calling from there why can't I pay for a local plan and avoid subsidizing the tower/person costs of residents of Wyoming?

Re:Stupid prices (1)

Amouth (879122) | more than 5 years ago | (#29026079)

Some companies actually still do what you ask - my dad has US cellular - he has free incoming (not sure how much out going ) for 30$ a month.. BUT he is roaming when he is at my house (120 miles) away

Re:Stupid prices (1)

demonlapin (527802) | more than 5 years ago | (#29026081)

So? You can easily drive 4500 km in the US without ever losing signal or paying a single penny in roaming charges. You can't do that in Europe unless you're doing circles. Roaming is relevant.

Re:Stupid prices (5, Funny)

Minwee (522556) | more than 5 years ago | (#29025931)

Western Europe | 514 people/mi^2
United States | 86.5 people/mi^2

Basicly it takes 5 times the area to hold the same numebr of people.

That's amazing. I knew that people in the USA were bigger than usual, but I had no idea they were that big.

Re:Stupid prices (0)

Anonymous Coward | more than 5 years ago | (#29025865)

>>Maybe voice your opinion to the companies so they stop charging so much?

Bwahahhaha! Customers are to be screwed! Bwahahhaha!

--Mobile Phone Company, Land Line Company

Re:Stupid prices (1)

mr_death (106532) | more than 5 years ago | (#29025927)

Why the hell mobile plans are so costly in US?

I submit it is because of the cozy duopoly initially set up by the FCC (the A and B provider) which has morphed into the two biggies (AT&T and Verizon) and the bit players (TMobile, Sprint). Sure, TMobile is cheaper, but the coverage sucks here, so its not worth it for most people. My company just made the painful switch from TMobile to AT&T for the coverage reason.

AT&T and Verizon have learned how to lobby the regulators, make sure that cellphone regulations protect the regulated, and bend most of us over on a regular basis. The same situation exists in broadband, where we get the "choice" between the single cable provider and the single dsl provider.

Re:Stupid prices (1)

AppyPappy (64817) | more than 5 years ago | (#29025971)

I paid $100 and got a cell phone, 1.3 years of service and 900 minutes from Tracfone. I don't see that as expensive

Re:Stupid prices (1)

amilo100 (1345883) | more than 5 years ago | (#29026009)

Hmm... I think that you should not underestimate the effect of different network types. The USA was the first country to popularise cell phones but its early networks were much worse than GSM. In many countries there are still operators with GSM networks that offer low cost cell phones.

Another thing is population density - the USA is fairly big and has a lower population density. Also, since the USA it would be fairly difficult for one operator to cover the whole country.

Hey don't blame the carriers (1)

wonkavader (605434) | more than 5 years ago | (#29026113)

The carriers have a lot of costs in the United States that they have to cover.

They need massive payrolls, for instance. It takes a lot of butts in seats to convince the local lawmakers that you have enough votes to unseat them if they don't do what you want. If the telcos didn't have control of so many voters they could threaten with layoffs, they wouldn't be able to get the tax breaks necessary to support their antiquated/anti-consumer business model. They'd have to change. Change is bad.

They also have to pay a lot of money to lawyers and on paper trails, because telcos are so highly regulated. They worked hard for that regulation, after getting a whiff of it initially, and got it increased beyond any semblance of reason so that no small carriers could afford to get anywhere in the business. They have to burn that money to keep other companies from cutting into their bottom line.

And it costs a lot of money to support antique technology, as well. By not modernizing, they save money in the short run, which helps them stay profitable, and makes sure that they need lots of people to run it, since it scales much more poorly than modern systems (which is excellent, since it means more employees/voters/bullying power). Not modernizing also limits services available, which is also good, since until we have good anti-network neutrality laws, someone else might be able to piggyback on those and get revenue, which might turn them into a real competitor someday.

Hey, keeping a strangle-hold on an entire country costs money! By paying absurd rates for crappy service, you're just doing your part. Keep up the good work.

Missing Data, Towers Probably Influence Cost (2, Insightful)

eldavojohn (898314) | more than 5 years ago | (#29025475)

Well, let's imagine that coverage of the country directly affects cost. This might not be so outlandish as cell phone towers need to be erected to cover area. I would venture to say that Americans & Canadians suffer from sprawl much more than Finland and total area of dense population is probably more than five times that of Finland's. So let's assume that those cell phone tower maintenance (more harsh weather conditions across the US than Finland also) and building costs are passed on to the consumer. The United States and Canada are are fourth and second (respectively) [wikipedia.org] by country size. Which could explain their inflated costs.

Of course this isn't the only factor, for example: I would assume China's median household income would affect their cell phone charges and cause them to drop despite country size. Wish they had data on China and Russia so this could be analyzed further. I don't see any in the data about these countries ... or even small rich countries like Morocco or Dubai.

Re:Missing Data, Towers Probably Influence Cost (-1, Flamebait)

Anonymous Coward | more than 5 years ago | (#29025569)

No, I'm pretty sure it's just stupidity tax.

Anything that's even remotely related to telecommunications and internet in USA has this tax. You pay it because you're too stupid to tell your government to shape up and make your country what it was supposed to be - a republic - where the law protects the small guys from the big guys, and as such you keep getting shit on again and again by supersized monopolizing companies, that can do anything they want because they have the money.

Stupidity tax.

Heh, even communism is better than what you people have, and you don't even realize it.

Re:Missing Data, Towers Probably Influence Cost (3, Informative)

ByOhTek (1181381) | more than 5 years ago | (#29025733)

Well, at it's good to know we don't have a monopoly on mindless, nationalistic arrogance here in the USA. I was starting to worry. Thanks for making me feel better.

Re:Missing Data, Towers Probably Influence Cost (3, Funny)

Anonymous Coward | more than 5 years ago | (#29025627)

It must be the extraordinary customer service that is driving the costs up!

Re:Missing Data, Towers Probably Influence Cost (2, Informative)

amorsen (7485) | more than 5 years ago | (#29025651)

Finland has 17 inhabitants per square kilometre on average. US is at 30. I would expect that Finland has universal cell phone coverage like the other Nordic countries, but unlike the US.

It also seems quite unlikely that the US has "more harsh weather conditions than Finland".

Re:Missing Data, Towers Probably Influence Cost (1)

Shakrai (717556) | more than 5 years ago | (#29025803)

It also seems quite unlikely that the US has "more harsh weather conditions than Finland".

Finland has over a thousand tornadoes every year?

Re:Missing Data, Towers Probably Influence Cost (1)

d3ac0n (715594) | more than 5 years ago | (#29026011)

Finland has over a thousand tornadoes every year?

Not to mention hurricanes.

Oh, and isn't Finland's square KM something close to Kentucky's?

Yeah, not really comparable.

Re:Missing Data, Towers Probably Influence Cost (1)

Dog-Cow (21281) | more than 5 years ago | (#29025893)

The US has severe forest fires, tornadoes, blizzards and hurricanes. What does Finland get? A bit of snow?

Re:Missing Data, Towers Probably Influence Cost (0)

Anonymous Coward | more than 5 years ago | (#29026099)

It's got "Sisu".

(go on, look it up and stop whinging)

Re:Missing Data, Towers Probably Influence Cost (1)

sopssa (1498795) | more than 5 years ago | (#29026117)

By looking at comments from US people, apparently bears roaming on streets and huge snowstorms so that you cant even walk outside :)

Re:Missing Data, Towers Probably Influence Cost (0)

Anonymous Coward | more than 5 years ago | (#29025653)

The sorts of mobile plans that people generally use in China are dirt cheap for SMS messaging, and pretty good for chat too. (I word this carefully because I believe there is some sort of experimental 3.5G system or whatever in Beijing and some other areas.. and you would pay American-ranged prices on those.. but only a small percentage of rich early adopters would use this)

I may not know everything about the system.. but typically, the phones are unlocked GSM phones. You don't deal with the subscription-on-purchase crap that exists in Canada, and presumably the US as well. Coverage/service area is awesome (it's freaking unbelievable where it works sometimes - often at 5 bars). Then you buy a GSM card from China Mobile, China Unicom (both public or quasi-public I believe), or if you prefer, a more niche provider. Many people don't bother with a subscription. An SMS message is a fraction of a penny. You don't sign your name, and you pay as you go by buying cards with codes. In some regions, you can get an awesome subscription plan where the price is very low and you can chat without limit.

Anyway.. the experience of living in China for a while made me consider mobile coverage as basic infrastructure (similar to highways) which is best provided as a public service. Those who believe the private model suits the problem best have likely been scammed.

Re:Missing Data, Towers Probably Influence Cost (3, Informative)

dgatwood (11270) | more than 5 years ago | (#29025687)

I would venture to say that Americans & Canadians suffer from sprawl much more than Finland and total area of dense population is probably more than five times that of Finland's.

You'd be wrong. The average population density in Finland is half that of the U.S. The U.S. has, on average, 31 people per square km; FInland has, on average, 16 people per square km. This according to Google. The total size of the area to cover shouldn't be relevant assuming similar percentages of the population use the service. Besides, the U.S. cell providers leave large swaths of the U.S. uncovered anyway....

Re:Missing Data, Towers Probably Influence Cost (2, Interesting)

sopssa (1498795) | more than 5 years ago | (#29025699)

Well, let's imagine that coverage of the country directly affects cost. This might not be so outlandish as cell phone towers need to be erected to cover area. I would venture to say that Americans & Canadians suffer from sprawl much more than Finland and total area of dense population is probably more than five times that of Finland's. So let's assume that those cell phone tower maintenance (more harsh weather conditions across the US than Finland also) and building costs are passed on to the consumer.

Eh, you obviously dont know much how nordic countries are. Most of the area is forest and not urban cities. Theres no tornadoes or such, but the weather changes a lot between summer and winter. Finland also only has 3 cities that passes 200k people living and the land area is large and many people live in smaller cities/towns. I would even argua that the cost of having cell phone network covered is more than on USA's area.

Re:Missing Data, Towers Probably Influence Cost (1)

nine-times (778537) | more than 5 years ago | (#29025709)

So let's assume that those cell phone tower maintenance (more harsh weather conditions across the US than Finland also) and building costs are passed on to the consumer....Of course this isn't the only factor, for example: I would assume China's median household income would affect their cell phone charges and cause them to drop despite country size.

Well aren't these two different explanations as to why cell phone prices are expensive? In the first one, you're assuming that the cost to the consumer is pretty close to the cost to the carriers for providing the service. If that's the case then yes, increased costs to the carriers would require them to pass those costs along to consumers.

But in the second explanation, China could only lower their charges to make it affordable to people with low incomes if you assume that the profit margin is wide to begin with. In such a case, an increase in cost would not need to be passed along to the consumers.

There may be several factors-- I'm not disagreeing with that aspect of your argument. I don't really know, but I suspect that the prices they're charging in the US is more about what they think they can convince people to pay, rather than having any relation to their actual costs. The reason I think this is because of the outlandish cost of SMS messages, in spite of the fact that, as I understand it, they're tiny in size and transmitted in what would otherwise be wasted bandwidth.

Re:Missing Data, Towers Probably Influence Cost (1)

Albanach (527650) | more than 5 years ago | (#29025773)

The United States and Canada are are fourth and second (respectively) by country size. Which could explain their inflated costs.

No it doesn't. The average population density of the United States (31/km2) is twice that of Finland (16/km2).

Re:Missing Data, Towers Probably Influence Cost (0)

Anonymous Coward | more than 5 years ago | (#29025779)

No, stop dragging out this old excuse. The population density of Finland is 40 people per square mile, the population density of the United States is 80 people per square mile. The reason you pay this much is because of fat cats who want all your money, who manage to get it due to the fact that the telecom industry is not regulated and thus a free for all money grab with no real competition. No regulation to ensure competition = inefficient market.

Re:Missing Data, Towers Probably Influence Cost (1)

fiontan (671239) | more than 5 years ago | (#29025885)

Good idea regarding population density and distance that coverage requires, but it doesn't explain how Australia fared so much better.

For that matter, in both the high usage and low usage charts, Australia even beat out Japan! For some reason not the medium usage, however.

Re:Missing Data, Towers Probably Influence Cost (1)

ThosLives (686517) | more than 5 years ago | (#29025907)

This isn't too surprising actually. Consider that regardless of region a person has some maximum income - call this 100%. Now, to estimate 'equilibrium prices' of various goods, you have to look at the entire basket. Say in the US you have 30% going to housing, 30% going to taxes, 5% going to personal transportation, 5% going to entertainment, 5% going to food, 15% going to health care, and 10% available for utilities including telecom. Now say that in some random other country, taxes and housing together account for 75% of total income instead of 60% - it's natural, then, that telecom will reach a lower nominal price in this instance. It doesn't even matter if the service is better in the country with lower sticker price, because it's just not possible to charge more for it.

In general all expenses will equal all income, so if you want cheaper telecom prices in the US, then expect, in the long run, the price of something else to increase. The little comment about "at least we have cheap gas prices" is probably much closer to the mark than intended.

Re:Missing Data, Towers Probably Influence Cost (1)

DaMattster (977781) | more than 5 years ago | (#29026063)

Has anyone thought about price collusion? Has anyone thought about industry collusion to keep prices high? A good comparison is Japan where the technology is much better at a comparable price. I have a friend with 100MbiT fibre to the home in Japan and he pays what the leeches at comcast charge us for 3MbiT down and 256K up. Oh, and by the way, that 100MBiT line is symmetrical both ways.

Yeah! We're number one! (5, Funny)

line-bundle (235965) | more than 5 years ago | (#29025499)

So we aim to be number one in everything:

healthcare costs
shortest vacations
.
.
.

Re:Yeah! We're number one! (1)

cayenne8 (626475) | more than 5 years ago | (#29025871)

"So we aim to be number one in everything:

healthcare costs

shortest vacations"

But on the bright side, we do have:

The best looking pr0n chicks!!

As for vacation? Well, that's up to you man. If you're good enough and have experience, go out there and have some balls to negotiate better for what you will work for...that includes time off as well as compensation.

Healthcare? Sure, we need to do at few things to change it for the better: alleviate the pre-existing condition things, make it easier to set up HSA's so individuals can more easily save up pre-tax for routine health visits (insurance should be only for emergencies), let us be free to buy meds from anywhere (Canada for instance), allow insurance and plans to cross state lines, etc, etc, etc.

It isn't THAT bad over here...at the worst you see on any polls, about 70% of the people in the US LIKE what they have. I dare say you can't hardly come up with any other topic that many Americans would agree on. So, why try to chuck the whole system, that the majority of people are seemingly happy with? Why not just fix what parts of the current system are broken?

Dutch second cheapest (3, Interesting)

Xenna (37238) | more than 5 years ago | (#29025509)

Well, that's a first! At last we're cheap in something else than marihuana...

Apparently the privatization of mobile networks worked out really well here!

X.

Re:Dutch second cheapest (3, Informative)

HetMes (1074585) | more than 5 years ago | (#29025741)

The only reason it worked out well here is because of the OPTA (telecom watchdog), which is, not surprisingly, a government organization. Without them, we'd still be paying through the nose.

Re:Dutch second cheapest (0)

Anonymous Coward | more than 5 years ago | (#29025975)

It's not the privatization only which did this, it's as much having a government agency (the OPTA) with enough power to enforce actual competition.

FREE MARKET (-1, Troll)

BitHive (578094) | more than 5 years ago | (#29025515)

If you don't like it, move to some other socialist fucking nightmare.

Paging wireless engineers... (1, Redundant)

R2.0 (532027) | more than 5 years ago | (#29025537)

How many GSM towers does it take to cover the whole of Finland?

MOD PARENT UP! (2, Interesting)

starglider29a (719559) | more than 5 years ago | (#29025641)

Take the average cited, multiply by the number of users, DIVIDE BY THE NUMBER OF TOWERS.

You don't realize how low the population density can drop until you ride a 3.3 gallon tank motorcycle through Wyoming. Number of phones per cell tower varies from 10 million to 1, sometimes.

Probably Government "Fees" (1)

rehtonAesoohC (954490) | more than 5 years ago | (#29025547)

I would wager that some government taxes or fees on the infrastructure is what is causing the high prices.

Or at least, that's what the cell companies will claim... "It's the FCC! They charge us $1.00 for every square mile we cover per month in fees!!11!11!"

Either way, it's greed, and it's the basis for our capitalistic society, so it's not going to change.

Re:Probably Government "Fees" (3, Insightful)

CorporateSuit (1319461) | more than 5 years ago | (#29025629)

I would wager that some government taxes or fees on the infrastructure is what is causing the high prices.

Or at least, that's what the cell companies will claim...

Oh I'm convinced that very large portions of telecom money go to congress... just not in taxes.

Re:Probably Government "Fees" (1)

blueg3 (192743) | more than 5 years ago | (#29025737)

You underestimate how much money they make, compared to their "donations". I doubt the donations are a very large portion at all.

Re:Probably Government "Fees" (1)

rehtonAesoohC (954490) | more than 5 years ago | (#29025805)

Exactly... that's why I put quotes around fees. They're not fees, they are "fees."

Huge difference =P

USA area most other countries (3, Insightful)

pak9rabid (1011935) | more than 5 years ago | (#29025593)

Although I agree it sucks paying more than other countries, I'd imagine the largest reason wireless providers in the US costs more in comparison to the rest of the world is because of the exponential higher cost associated with deploying the infrastructure due to the physical size of the US. Of course, there's probably other more devious things going on that also attribute to the higher costs, but it's not all attributed to evil wheelings and dealings.

Re:USA area most other countries (4, Informative)

0racle (667029) | more than 5 years ago | (#29025769)

Even if it was granted that cell plans in the US cost twice as much (or more) for worse service was because of the area of the US, that infrastructure has pretty much been in place for the past decade and hasn't changed much. Its been paid for already and maintenance does not cost as much as the initial deployment. So if it actually had anything to do with the cost of infrastructure, plans should have become more affordable, as they have pretty much everywhere except the US and Canada.

Re:USA area most other countries (1)

Shakrai (717556) | more than 5 years ago | (#29025887)

that infrastructure has pretty much been in place for the past decade and hasn't changed much

Which is why we are all still using AMPS analog cell phones that can be easily cloned and eavesdropped on by anyone with a scanner.....

Value (0)

Anonymous Coward | more than 5 years ago | (#29025597)

Average cost is one thing, but value is the cost compared to what we are compensated with. In Finland, data plans are not nearly as popular as in the USA. While I will concede that we are probably still paying more than other people in countries do for equivalent services, it is likely that the high cost we pay is in line with the cost of providing the many services to the 300 million Americans who desire them.

How is that free market working for us? (2, Insightful)

krbvroc1 (725200) | more than 5 years ago | (#29025599)

Among the most expensive and not even for a service that is advanced compared to other countries systems. And so called competition between carries is for which carrier can offer you which features for a high price ($55) plan. There is no real competition when it comes lower cost plans. And finally, my opinion for the most expensive, the lack of open systems. Carriers lock people into certain models of phones. Those lock-ins not only keep customers from shopping for the best service/price, but requires the carriers to earn even more profit to subsidize the exclusive contracts with the phone vendors.

Re:How is that free market working for us? (1)

Late Adopter (1492849) | more than 5 years ago | (#29026087)

There is no real competition when it comes lower cost plans. And finally, my opinion for the most expensive, the lack of open systems.

That's not really true, there's companies like Cricket (and T-Mobile to a small extent, which is itself a branch of Deutsche Telecom), plus all the pre-paids. I think the situation is more that Americans are used to spending such a large fraction of their money on Cell plans, that they like all the bells and whistles. I.e. it's seen as a luxury service in the US.

As for open systems, there's 3G. T-Mobile will give you and a bare simcard if you ask for it, and you can take the AT+T simcard from your free feature-less phone into the unlocked phone you bought off Amazon.

I really don't think the cellular market is that anti-competitive right now. It's just different from much of the rest of the world.

Infrastructure is part of it ... (1, Informative)

neonprimetime (528653) | more than 5 years ago | (#29025619)

United States total area: 3,537,441 square miles [enchantedlearning.com] .

The area of Finland is 131,000 square miles [joensuu.fi] .

Re:Infrastructure is part of it ... (0)

Anonymous Coward | more than 5 years ago | (#29025821)

.. and the US has more than 50 times the population of Finland, genius.

Population density is the right measure here, and in Finland it's about half that of the US. There really is no good excuse for the incredibly bad coverage that US cellphone carriers offer, besides greed and failed markets.

Re:Infrastructure is part of it ... (1)

oogoliegoogolie (635356) | more than 5 years ago | (#29026083)

I dunno about that...the US probably has 300x as many subscribers so the cost per user probably is equivalent.

Cell phone companies use a similar deceptive argument to justify higher prices in Canada....larger area, but 1/10th the population of the US. But what they leave out of course if that only 1/10 of the area of Canada has cell phone service. It's not like they are building hundreds of towers to provide blanket coverage on Baffin Island or all of northern Saskatchewan.

$50? (1)

Nightspirit (846159) | more than 5 years ago | (#29025623)

I pay $29 but then I guess I'm not a phone whore and only need 200 minutes/month. It does make sense though, the stretch of I10 going from Phoenix to Los Angeles (where nothing but desert stretches for miles) is probably the length of Finland itself.

Phoenix to Los Angeles vs Finland (1)

bakaorg (870848) | more than 5 years ago | (#29025841)

I suppose that could be true...if you didn't spend five seconds looking it up. Phoenix to Los Angeles (by ground) is 372 miles. Utsjoki to Helsinki (Finland, by ground) is 795 miles. Your argument may be correct in general but in specific...

comparing apples and oranges..... (5, Informative)

Shakrai (717556) | more than 5 years ago | (#29025657)

In Europe (and most other regions outside of the US and Canada for that matter) the cellular user is not expected to pay the full cost of having wireless service. This is why other users who call your cell phone pay a premium for doing so and why the wireless customers over there often have free incoming calls. This is known as a "caller pays" model.

The US has (for better or worse) adopted a "subscriber pays" model wherein the wireless customer pays a higher price and for incoming minutes but those who call him and do so at the same rate as any other phone call (free in many/most cases). The US also has many perks that aren't part of most calling plans in other countries -- unlimited calling to X numbers, unlimited nights and weekends, unlimited mobile to mobile, etc, etc. Add in all of these perks and break down the monthly rate by the number of minutes used and many Americans wind up paying around $0.02-$0.03 per minute for their cellular phones.

It doesn't really tell us much to see a per month cost break down without looking at all of these other factors. In any case if you want to copy something from the rest of the world regarding wireless business models I would look at copying the concept of unlocked phones that are separate from contracts long before I'd look at copying their rate plans. I rather like to be able to call my friends who have cell phones without paying a penalty for doing so.

Re:comparing apples and oranges..... (1)

BorgDrone (64343) | more than 5 years ago | (#29025905)

I rather like to be able to call my friends who have cell phones without paying a penalty for doing so.

I'm from the Netherlands (2nd cheapest on the list) and I can say that there is no penalty for calling your friends on their mobile phone, as long as you call from another mobile phone (does anyone even use a landline anymore ?).

Add in all of these perks and break down the monthly rate by the number of minutes used and many Americans wind up paying around $0.02-$0.03 per minute for their cellular phones.

Which is only useful if you use your mobile to call people, I don't. On average, I call 1 to 2 minutes per month. I use my mobile for internet access, which is flat-fee, cheap and fast.

Re:comparing apples and oranges..... (5, Interesting)

oneandoneis2 (777721) | more than 5 years ago | (#29025949)

Uh.. those perks have been available in England for years. Plus when we get a phone with a contract, the phone is usually free. And can be upgraded every year, for free.

I'm visiting America for a couple months right now, so I've bought a cell phone for while I'm here, and I've been appalled at how bad your cell service is. You guys have phone companies boasting in adverts that they drop your call less than any other network. FFS, why do you put up with them dropping your call at all?!? Unless you drive through a lot of tunnels or live in serious wilderness, if your phone dropped a call in England as often as they seem to over here, the network responsible would be out of business long before your contract had a chance to expire.

And the nuisance calls.. I bought a brand new phone and gave my number to maybe three people. I've received over a dozen calls from unknown numbers, all of which Google has identified as scam callers. And I've been charged for being called by these so-and-so's.

Cell phone services over here are just dreadful. Why you all pay so much for such mediocre service, I really don't know.

Re:comparing apples and oranges..... (3, Informative)

radish (98371) | more than 5 years ago | (#29026035)

Why you all pay so much for such mediocre service, I really don't know

Because it's a wonderful free market and we all have a choice. Oh, wait...

I live in the US but I'm British, so I know exactly what you mean. Orange wasn't great but it beat the crap out of AT&T...

Re:comparing apples and oranges..... (1)

PeanutButterBreath (1224570) | more than 5 years ago | (#29026089)

I rather like to be able to call my friends who have cell phones without paying a penalty for doing so.

IOW, you don't mind overpaying for service because you get perks for "free"?

Skype, Fring, Googlevoice (1, Insightful)

Anonymous Coward | more than 5 years ago | (#29025677)

VOIP FTW

I have it under 50$ (3, Informative)

AnswerIs42 (622520) | more than 5 years ago | (#29025697)

I have my bill down to 35$ a month though AT&T... but I have found out something quite nasty.. My number is a Michigan one, since I was living there at the time. I have since moved to Pennsylvania but left the number the same since people know the number I have. Since I pay my bills online I never looked that closely at the bill. This last month I did.. and found out I am paying TWO sales taxes, Michigan and Pennsylvania. And when I called about it, it is because the number is a Michigan number.. because it is they can charge a sales tax on it.. as well as tax me because I reside in Pennsylvania. Their solution.. change my number (not a very good solution). I don't see why one should be taxed for where a number resides.

Re:I have it under 50$ (3, Interesting)

CorporateSuit (1319461) | more than 5 years ago | (#29026119)

And when I called about it, it is because the number is a Michigan number.. because it is they can charge a sales tax on it.. as well as tax me because I reside in Pennsylvania

Avoiding a double-taxed good was the focal point of the "no taxing interstate commerce" clause in the constitution. Let AT&T know you're speaking to lawyers today about starting a class-action lawsuit against them for double-taxing you.

Some other info about Finland (5, Informative)

Albanach (527650) | more than 5 years ago | (#29025707)

I should probably have added this when I submitted.

In these threads, there are often comments about population density in Europe making coverage more effective. Finland has a population density of 16/km2 - that's lower than Maine and 37 other US states.

Perhaps you think Finland must be tiny, in fact it's land area is 305470 sq km, that's bigger than Arizona. There are only five US states larger than Finland.

Maybe coverage is actually really poor, restricted to big cities? Take a look at this coverage map.

http://www.gsmworld.com/cgi-bin/ni_map.pl?cc=fi&net=te [gsmworld.com]

Do any US states have coverage like that?

Re:Some other info about Finland (1)

james_shoemaker (12459) | more than 5 years ago | (#29025989)

So 5 US STATES are each larger than the whole country.

    Its mostly a matter of the large areas that would have to be covered for little or no advantage. The small number of towers required to cover the lightly populated portion of finland would get arizona covered, where does the money come from to cover the rest of the lightly populated states?

Re:Some other info about Finland (4, Funny)

commodoresloat (172735) | more than 5 years ago | (#29026039)

Perhaps you think Finland must be tiny, in fact it's land area is 305470 sq km, that's bigger than Arizona. There are only five US states larger than Finland.

...and Texas is two of them.

Hidden Costs in European Cell Rates (3, Interesting)

Colonel Korn (1258968) | more than 5 years ago | (#29025713)

From TFA, 1680 minutes per year is considered high use. Really? Two hours twenty minutes per month.

Also stated is that same-network free calls and such aren't considered in the data, which skews prices higher in the US than is realistic. I pay $67 a month after taxes for unlimited everything but mid-day calls made out of network, with nights and weekends beginning at 7 PM. That's not great from a global perspective, but it's not the worst in the world, either, considering that I get 3-4k minutes of use and a few hundred pictures and videos sent in that interval.

Anyway, my real problem with European cell phones is how much is costs to call them. If I'm in Italy and I use a calling card to call an American land line, I'll pay around $0.02/minute. If I call an American cell, I'll pay exactly the same amount. If instead I'm in America and I call an Italian land line, I'll pay $0.01/minute, while a calling an Italian cell will cost me $0.15/minute on the same calling card.

On another note, I'm glad that my cell plan includes unlimited skype usage.

Get rich quick (1)

T Murphy (1054674) | more than 5 years ago | (#29025763)

If someone here has a few hundred million dollars you can get rich quick by starting up a cell phone company to fill this void of competition.

Highest rates because of highest taxes??? (0)

Anonymous Coward | more than 5 years ago | (#29025771)

I'm wondering how the cost of a phone minute is broken out.
Fore example
What is the:
Profit = $??
Infrastructure = $?? (lets not forget the environmental wackos driving up legal costs for each tower)
Federal Tax = $??
State Tax = $??

Until we see a real breakout there is no way to assign blame. I suspect more than just the carriers are to blame for the high cost.

Don't forget spectrum licenses (1)

JSBiff (87824) | more than 5 years ago | (#29025899)

On top of whatever taxes are part of the phone bill, the way a company gets a license to use RF spectrum in the United States involves spectrum auctions every few years. The last time the spectrum auctions happened, you had cell phone companies paying several billion dollars each [wired.com] for their licenses.

The thing is, companies never 'pay' for anything - they just pass the costs on to the consumer. So, how much of each minute is your share of the 2 or 4 Billion dollars?

I think the whole system is fundamentally broken and does not server U.S. Taxpayers very well, because even though it does raise revenue for the government, it also drives mobile phone bills way up. There's got to be a better, cheaper way to allocate spectrum than a highest-bidder auction.

Heroin (0)

Anonymous Coward | more than 5 years ago | (#29025785)

is pretty expensive too.

Subsidized by fixed lines (1)

amorsen (7485) | more than 5 years ago | (#29025817)

Mobile phones in Europe are subsidized by calls from fixed lines. Since you do not pay to receive calls, there are two rates for calls FROM land lines: a cheap rate to other land lines, and an expensive rate to mobile phones. Some carriers get more than half their income from incoming calls. When you call from a cell phone to a cell phone with a different carrier, the originating carrier usually pays more to the terminating carrier than the customer pays.

So don't use a land line to call a cell phone in Europe. Use another cell phone; their plans are almost universally cheaper.

U.S. Health Care Among World's Worst: (0)

Anonymous Coward | more than 5 years ago | (#29025919)

in terms of cost expenditure.

Please try to educate, rather than stupify, your readerz.

Yours Virtually,
K. Trout

Area is a bogus argument (2, Insightful)

FranTaylor (164577) | more than 5 years ago | (#29025923)

Because the US does NOT have universal GSM coverage. For example, a GSM phone is pretty useless in New Hampshire if you live north of Concord.

There are vast areas of the US with no cell coverage at all.

What's wrong with US services isn't in this study (2, Insightful)

demonlapin (527802) | more than 5 years ago | (#29025943)

Several factors to consider:

1. The study is crap. The "high usage" plan is 1600 minutes/YEAR, 660 SMS/YEAR. That's not high usage; it's barely even light usage. The US plan selected has a low number in "fixed" but a high number in "usage"; this would suggest that they calculated what it would cost based on the cheapest-available plan. US overage charges are indeed ridiculous, in the 40c/min range, but nobody ever pays them because adding airtime to a plan costs very little.

2. US plans offer coverage nationwide and with no charges other than airtime for calls from anywhere to anywhere in the country. When there's an EU-wide plan providing the same coverage - no international charges - then we're getting close to an apples-to-apples comparison.

3. Population density is a real problem. I think the person upthread who suggested that the real metric that should be used is total # of subscribers divided by total # of towers is right - average population density is misleading.

Explanation (4, Insightful)

DaMattster (977781) | more than 5 years ago | (#29025987)

The US has such expensive cell phone plans because the government has been protecting Big Telecom and turning a blind eye to exhorbitant pricing. In fact, by keeping prices high and using media spin to say just "how competitive we are" with the world, many US citizens are unware of anything better. It took Boost Mobile and Straight Talk to do something audacious and lower pricing on unlimited service to wake up competition again. Since the George W. Bush administration was pro rich, little was done to curb the excesses of big telecom and if big telecom can make gobs of money on older technology, there is no incentive to upgrade, thereby putting us further behind the technology curve. We all know what George W. Bush did to stifle science. For a while you really had only four choices: Verizon, AT&T, T-Mobile, and Sprint. There isn't a doubt that these telecom giants colluded to keep prices high. I remember the hoopla when Verizon came out with FiOS. Everyone was thinking we had hit a miraculous breakthrough in broadband which is just what Verizon wanted everyone to think. Verizon banked on the ignorance of consumers. In reality, FiOS is behind the 8 ball. Japan has 100MBiT to the home right now. When the Verizon sales rep tried to tell me how great it was, I replied, "Stop. Just please stop the bullshit sales pitch. Japan has had 10MbiT to the home just prior to the turn of the century. This is nothing new or miraculous. Don't bank on consumer ignorance." To which I got a snarled response. Qwest is doing this right now in the Arizona Valley. Oh my god, "12MbIT service," whoop ti dooo!"

No frills cell phone in the US (1)

Tynin (634655) | more than 5 years ago | (#29025999)

I have a T-Mobile pre-paid plan. $100 for 1000 minutes, good for 1 year. I got the phone for free with a promo they were doing, and seem to do quite often for new customers. If you don't talk much and just need a cell phone for its abilities to be just a phone, it is really hard to beat this price.

10.95/month sounds expensive (2, Interesting)

luvirini (753157) | more than 5 years ago | (#29026005)

I fall in the low usage category in Finland and have paid a total of 8.52eur for all my mobile phone usage since November last year when I switched carriers. I commited to 24 months at 0.66eur/month and I get 50 minutes of normal price calling as bonus. The base cost has thus sofar been 5.94eur and the rest has been mostly international use. Though I went a few minutes over the 50 one month, those calls being billed at 6.9 cents/minute.

Normally one does not commit to any term and can switch carriers in about a week, as I have done couple of times. So the free 50 min/month is an attempt to get some heavy users to get locked into their service.

There's more land to cover (0, Redundant)

orev (71566) | more than 5 years ago | (#29026019)

There's simply a lot more land to cover in the US, and that is covered by fewer companies than in Europe and elsewhere. Covering more land requires more towers and more expense.

The picture next to the story (0)

Anonymous Coward | more than 5 years ago | (#29026069)

What the heck is that a picture of? The black thing with the big dial. Is that, like, one of those record player thingys?

Commercials (1)

methano (519830) | more than 5 years ago | (#29026103)

Somebody's got to pay for all those cute commercials. Maybe we should ban direct to consumer advertising of phone service.

Including all costs? (1)

javelinco (652113) | more than 5 years ago | (#29026121)

Do these monthly rates include all costs, including taxes? Or are they only including the actual amount that shows up on the monthly bill?
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