Bell Plans to Cut US Roaming Rates by 50% Starting Sept. 17

by Gary Ng on Monday, September 16th, 2013 – 8:58am PDT

http://globalnews.ca/news/842645/bell-drops-u-s-roaming-rate-for-customers/

Bell announced that they will be reducing the rates on its US roaming plans by 50%, as what the company says is its continued focus on “lowering costs for customers” who use their phones outside of Canada.

Every year 18 million Canadians enter the US and annually spend an estimated $800 million in roaming fees, charged by carriers who have network agreements in place with local US carriers. By decreasing its rate by 50% as we can see from p1 to p2, there is a significant change in the quantity demanded for the service from q1 to q1. Therefore, we can say that the demand for roaming services is relatively elastic. This shows that Bell is making the right choice of decreasing its costs by 50% to increase demand and therefore, decreasing its costs and increasing its revenues in the long run from the consumers. This would give the consumer more satisfaction as well as they are now paying half the price that they would before. In this situation Bell is implementing the right policy/method at the right time, allowing both the consumers and producers to benefit from the change.