International freephone is localized and costly - Industry Trend or Event

In 1998, the International Telecommunication Union (ITU) in Geneva introduced the universal international freephone number (UIFN). The ITU was trying to build on the success of national freephone numbers with a global "country code" of 800. But it has proved neither universal nor free. Now the European regional code faces the same fate.

Incumbent telecoms operators designed the UIFN system to protect their domestic freephone business, requiring calls to pass through their international gateways and accrue the accounting rate charges. The result is that an incoming call costs a business about [epsilon]2 per minute. Few applications can carry such a charge.

A significant number of users cannot dial the international access code as it is barred as a proxy for expensive calls. Many operators do not route calls to country code 800 numbers. Others, especially mobile operators, make a substantial charge.

Not for the first time, the efforts of the ITU have proved futile. UIFN was stillborn. Most businesses returned their UIFN numbers. Had the ITU acted promptly, UIFN might have been saved and future problems avoided.

There was undoubted demand, as seen by the enthusiastic early registrations for UIFN and in the continued search by businesses for cost-effective solutions.

Last year the ITU approved a regional code, +3883, for Europe. Predictably, it is encountering the same problems as UIFN: call barring, refusal to route calls and potentially high costs. Even if the European Union imposes an obligation on a few fixed operators, it will be left to them to determine the charges. At international accounting rates, the charges will be far above the level the market will pay. But many operators have networks in all the countries concerned to which calls could be connected at minimal cost.

Incumbent fixed operators are extremely reluctant to provide access to +3883. Mobile operators ignore the existing European telephone numbering scheme (ETNS), while blocking or charging for access to national freephone services. There are no market forces that oblige the operators to provide the service, and the national regulatory authorities lack the powers to impose the low costs that would make these services useful for business. Instead, operators prefer to offer their own services, exclusive to their networks.

The underlying challenge is to get customers cheaply into voice contact with the corporate virtual private network. At present it requires complicated strategies developed on a country-by-country basis, with no pan-European or global numbering possible.

One radical alternative being developed by the Internet Engineering Task Force (IETF) and the ITU is a mapping of telephone numbers to Internet addresses, known as ENUM. Although still in the early stages of development, it will effectively allow callers to dial www.brandname.com.

Another option is to put a button on a website to enable a "talk with us" service. However, at present, few Internet connections from customers can provide a satisfactory end-to-end voice quality. Some of these issues can be patched over by instant messaging software, others must await the wider use of cable modems and digital subscriber line services.

It is a race to reach to a cost-effective solution and the regulatory route is slow. Moreover, even an approved service may be dead on arrival, because of the opposition or apathy of the fixed--and especially the mobile--operators. The technological short-cuts may yet prove the easier route.

Ewan Sutherland is executive director of INTUG, the International Telecommunications Users Group

COPYRIGHT 2001 EMAP Media Ltd.
COPYRIGHT 2001 Gale Group