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Telecoms – Why roaming charges may survive despite MEPs demands

EDITORIAL “Telecoms experts from the European Union’s member states will tomorrow (13 January) discuss a proposal to dramatically cut roaming charges across the EU, but not remove them completely.” according to a report by European Voice. Note, that is cut, not scrap as proposed by the European Commission.

It goes on to say that “Member states are concerned that banning roaming fees would lead some operators to lose money when consumers travel to countries where operators’ costs are higher. They are also worried that consumers could play the system by taking out a mobile phone contract in a member state where mobile fees are low, only to use it elsewhere.”

This reasoning seems to be utterly counterintuitive, in nearly every other business, the competitive pressures unleashed by the single market are seen as a good thing. The whole point about price competition across the single market is to allow consumers to ‘play’ the system. The advancement of such reasoning to support anti-competitive measures seems to speaks volumes as to whose interests are being pursued.

It appears that national politicians have been persuaded that “a combination of these effects could lead domestic mobile phone call and data prices to rise.” The Body of European Regulators of Electronic Communications (BEREC), has fired the first shots in the battle by warning telecoms ministers that a ban on roaming fees would carry great dangers. However, ministers ought to take into account how many of the national regulators have been ‘captured’ by the mobile phone companies as they fight a rearguard campaign to protect their most profitable charging mechanisms.

BEREC has claimed that “removal of retail roaming surcharges across Europe is not currently sustainable or feasible in practice, given the significant variations in a number of important parameters across member states, including (but not limited to) the levels of retail tariffs, costs, and travelling and consumption patterns,”. The whole point of the single market is to eliminate market separation (leading to formally or informally protected national markets allowing operators to charge higher prices) where it exists. BEREC’s proposals appear to defend market separation as a good thing.

The European Commission’s 2013 proposal to reform EU telecoms rules has already nearly been eviscerated, with just rules on roaming and net neutrality – kept. The proposal before the Council of Ministers has two options. The first would eliminate roaming fees, but allow operators to top-up their tariffs where they are lower than the actual roaming costs. The second would cap voice calls at €0.05 per minute (a cut of nearly 75%), data at €0.05 per MB (a cut of 75%), and text messages at €0.02 (minus 66%).

The Latvian presidency appears to favour keeping roaming charges at the revised rate, arguing in a briefing document that it would be “far easier to implement both for operators and national regulatory authorities”. MEPs have already calling for a complete ban on roaming fees from 15 December 2015. It would appear that if the Council of Ministers fails to scrap roaming charges then the European Parliament will be less than impressed.

  1. This seems to be a very deep change of heart i.e a cut not scrap the charges. The problem is that we already have a way to cut charges made by the large operators using prepaid sim and data cards from the likes of Ekit and Go Sim. These savings can be up to 80% in some instances so it seems that we are reducing rates to what we can get already. Is this a waste of time again? Just get the EU bodies to publicise these services.

    Comment by davido on January 18, 2015 at 1:10 pm
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