Want to use your phone overseas? This startup can save you a fortune in roaming charges
- September 16, 2014
- at 9:00 am
by Daniel Tay
Traveling might not be as expensive as it was a few years ago, but it can potentially run up several thousands on your bank account if you don’t do due diligence in planning – and I’m not just talking about flight and accommodation bills. A simple upload of your lovely holiday photos to Facebook on data roaming can potentially lead to a £20,000 (US$32,000) phone bill, as this woman found out.
This is a huge recurring problem for business travelers in particular, who usually opt to purchase a local SIM card to overcome ‘bill shock’, according to Flexiroam founder and CEO Jefrey Ong. To him, this is literally a decade-old problem that he has observed since joining the telco industry as a senior software engineer in 2000.
Back then, Skype was the common means of communication for business travelers looking for a cheaper option, but it was still not good enough. Ong explains:
Even though you can make calls on Skype, it still runs on data – and if you are a traveler, you know how expensive data can be. This is why we tried to understand why telcos are charging their consumers twenty to thirty times more the moment they step out of their country. The cost of communication becomes so high and inconvenient.
He noted at the time that almost one-third of the people in the world had not traveled out of their country before. “We thought, with the rise of budget airlines, there should be more and more people traveling outside their country very soon, yet this ‘bill shock’ continues to be a real problem that remains unsolved – it’s a space for us to go into,” Ong recounts.
And so in 2010, Flexiroam was born. The first iteration was designed to be simple – a S$5 (US$4) per day service that forwards the customer’s local number to his/her overseas SIM card, solving one part of the traveler’s problem. It launched initially in Malaysia.
“If you buy an overseas SIM card, you usually wouldn’t tell everyone your new number, and so they will end up calling your local number and not be able to reach you,” Ong explains. “At the same time, if someone calls your overseas SIM card, they will incur the international calling costs instead. That S$5 (US$4) a day solves all these problems.” About 30,000 repeat customers today continue to use this service, which makes up 10 percent of the firm’s current 300,000 subscriber base.
The startup’s service turned out to be a hit in its native Malaysia. Then the team decided to tackle the next big problem that travelers face: actually getting their hands on a SIM cards when visiting another country. “So we came up with a product that bundles a SIM card as well,” Ong says. “A flat rate a day will allow you to keep your original number, together with unlimited data and voice calls.”
This product, which they called the Buzz Sim, turned out to be their bestseller. The SIM card can be used in multiple countries over a certain time period. Thus far, Flexiroam has inked partnerships with about 580 telcos around the world so that no matter which country you go to, you will always be able to access the local networks for data and voice calls.
“For example, when a customer uses Flexiroam in Singapore, we will foot the bill to Singtel, and the customer will pay us,” Ong explains. He calls these telcos “roaming wholesale providers” – Flexiroam will use whichever telco gives the company the best rates in the respective countries. Naturally, it only chooses one network per country, which is the one that gives the best rate. What’s in it for the telcos? The startup’s 300,000 subscriber base, of course.
Many of the startup’s customers come from the corporate sector, including big names like Toyota, AirAsiaX, and Malaysia Airlines. The team has also formed many strategic alliances with travel industry players.
Read on at Tech In Asia: — Want to use your phone overseas? This startup can save you a fortune in roaming charges