For the Australian and New Zealand markets the caller does negotiate the price with their operator. The calls to mobiles (whether from a mobile or landline) are payed for by the caller at the rate they have agreed with their operator. From this perspective the person who is receiving the call receives free incoming calls. You only pay for the calls that you make.

For example: a caller makes a call from their landline to a mobile operator - ANY operator. The cost is paid for by the caller at the rate advertised by their landline provider. This is the same rate for any mobile operator you are calling.

For example: a caller makes a call from their mobile to another mobile. Most mobile operators in Australia and New Zealand have a different rate for calling within the same network or to another network. If the caller is calling a different network to their own then they are charged at a flat rate. The interconnect charges between operators are not taken into account here. It is a rate defined in the callers contract for calling ANY mobile on another network.

The statement you made "Any time the person negotiating the rate is not the person paying the rate you get a flawed market.". This is not the case in Australia or New Zealand. The calling party has always negotiated a price with their operator which they pay for the call they make.

Of course roaming is a different matter which I will not get into.

I personally find the receiver pays model quite absurd, but that is my own feeling on the matter. I would be interested to know if this is also the case for SMS & MMS? Can I send a lot of SMS messages to my friend in the US and use up all his credit? Of course, he may not be a friend after that ;)