Mandatory U.K. Roaming Would Eliminate “Not Spots” and Differentiation

“Not spots” are a major mobile customer irritant, therefore a major problem for most mobile service providers, as well as a problem for capital budgets, as “not spots,” places where signal coverage is weak to non-existent, typically exist because the cost of installing new infrastructure does not allow for recovery of costs.

Usually, mobile operators try to remedy those sorts of problems by striking roaming agreements with other networks that do have coverage in the areas of weak to non-existent signal. But that doesn’t always seem to work.

The U.K. government has asked U.K. carriers to come up with a voluntary and universal plan, and apparently they have failed to do so.

So mandatory network access now might be on the agenda in the United Kingdom.

The idea is that a mobile operator whose own network fails, in a specific area, would have mandatory access rights on other networks serving that area that can provide service. In essence, that creates a mandatory and enforceable roaming agreement.

It might not be hard to figure out why the leading mobile service providers have rejected the idea so far. Competition on the basis of network coverage often can be a major marketing weapon.

Mandatory roaming eliminates a source of differentiation in the market.

If coverage, normally a key component of “quality” (“we have the best network, with the best coverage”) goes away, what are the key parameters on which operators can differentiate?

What mostly is left is the variable they dislike the most: price (more precisely, value related to price).

Under a mandatory roaming plan, incentives for building new infrastructure would change.

Where there is universally poor coverage, such as in a rural area, there is an incentive for at least one mobile operator to build, and then claim the “best coverage” in that area.

If mandatory roaming is required, then the firm that made the investment incurs cost with no advantage: the rivals will be able to use the network as well. That makes the investment unwise.

Up to this point, suppliers have done so on a limited basis. Vodafone and O2, for example, allow roaming across their networks, while EE and Three likewise allow roaming across their networks.

Under some circumstances, the existence of “not spots” might call out for some sort of voluntary sharing of infrastructure, which mobile operators have agreed to in other instances globally (sharing towers and sometimes radios).

Under the arrangements already in place, however, each consortium can claim advantage in some areas, if not all. All that would go away in the event of mandatory sharing across all networks.

Differentation might be eliminated in other ways, as well. Some studies show Vodafone has the best voice coverage in some areas, while EE has the best 4G Long Term Evolution coverage in some areas. All of that would be leveled, with no advantage for any provider, in the event of mandatory roaming.

The issue illustrates how hard it can be to both protect the public interest by ensuring universally good service, and yet also provide incentives for mobile operators to invest in providing that service. 

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