swiss lanline to mobile phone call pricing inflated overpriced

Swiss Telecom Service Providers Charge Inflated Landline-To-Mobile Rates

An analysis by moneyland.ch shows that the profit margins applied by Swiss telecom providers for calls to mobile phones from landline phones are much higher than those applied to calls between landline phones.

In his department's latest newsletter published on May 22, 2018, federal consumer price watchdog Stefan Meierhans criticized the high cost of calls to Swiss mobile phones from landline phones. According to Meierhans, the profit margins used by Swisscom for calls to mobile phones are far higher than those applicable to the regulated rates for calls between landline phones. The consumer watchdog is bothered by the federal council’s abstinence in setting limits on fees for calls to mobile phones.

As a result of an intervention by the federal consumer price watchdog, Swisscom will begin offering an Option Mobile Flat supplement for its landline plans on June 24, 2018. The optional supplement costs 9 francs per month and enables unlimited calls to Swiss mobile phone numbers.

Many service providers already provide similar flat fee offers. Swisscom began offering a landline plan with unlimited calls to Swiss fixed and mobile phone numbers at a flat fee of 39.50 Swiss francs back in 2011. Swisscom customers can also use its 15-franc inOne home bundle to make unlimited phone calls to Swiss landline and mobile numbers.

Profit margins used by Swisscom and its counterparts are too high

Current calculations by moneyland.ch clearly show that the profit margins applied by Swisscom for calls from landlines to mobile phones are radically higher than those applied to calls between landline phones.

Based on a 3-minute average call time at during standard-rate hours, calls between two landline numbers cost 8 centimes per minute. After deducting value added tax and the cost of using the network, Swisscom is left with a profit margin of 5.87 centimes per minute.

Swisscom charges 32 centimes per minute for calls from Swisscom landlines to Swisscom mobile numbers and 35 centimes per minute for calls to Sunrise and Salt mobile numbers. After deducting value added tax and network costs, Swisscom is left with a tidy profit margin of 25.98 centimes per minute, or 27.82 centimes per minute for calls to Sunrise and Salt mobile numbers. That means Swisscom’s per-minute profit margin is more than four times higher for calls to mobile phones than for calls within its landline network.

It is interesting to note that landline users in Germany can call Swiss mobile numbers for just 5 euro cents (approximately 6 centimes) per minute.

Verdict by moneyland.ch telecom expert Ralf Beyeler

“It is obvious that competition is not having as strong an influence on the Swiss telecom market as it should have,” says Ralf Beyeler of independent online comparison service moneyland.ch. As a result, service providers charge inflated rates. Customers which do not make use of flat fee offers are the hardest hit. It is also important to note that all Swiss telecom service providers charge inflated rates for calls from landline numbers to mobile numbers – not just Swisscom.

 “A fair price for calls from landline numbers to mobile numbers would be around 12 centimes per minute,” according to Beyeler. That would still leave Swisscom with a slightly higher profit margin than the one applicable to calls between landline numbers.

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