EU wants a good text life and axes roaming charges by 60pc

24 Sep 2008

The European Commission has moved to reduce the price of roaming text messages by 60pc by July next year. As a result, EU citizens travelling within the EU will pay no more than 11 cent per SMS, compared to the current EU average of 29 cent.

The Commission said yesterday that it also wants to improve transparency for surfing the web and downloading data on a mobile phone while abroad.

It said consumers used to cheaper data services at home should be better protected against roaming ‘bill shocks’ that can run to thousands of euro.

The proposals will now be submitted to the European Parliament and Council, which must agree before they can become law. The EU already reduced charges for making and receiving calls abroad by 60pc in the summer  of 2007.

“Europe, through its GSM standard, made mobile telephony attractive across the globe,” said José Manuel Barroso, President of the European Commission.

“It is now time to demonstrate that there is a truly single telecoms market in which consumers can use their mobile phone in all 27 EU countries without being punished when crossing a border.

“If we get this done quickly, we will see tremendous growth in SMS and data services, and send a message that lower roaming charges can be a win-win situation for all.”

Text messaging is universally popular among EU citizens ,who in 2007 sent 2.5 billion SMS worth €800m. Some 38pc of 15-24 year olds text when abroad.

But the cost of roaming texts can be 10 times more than domestic texts, and as high as €0.75 per SMS for travellers from Belgium. A typical French customer sending a roaming text message from holidays in Italy this summer could pay up to €0.30, while a Czech tourist would pay up to €0.42 (10.00 CZK).

In Spain, a Swedish holidaymaker could pay up to €0.40 (3.79 SEK) per message when roaming, a German €0.32, a Pole €0.47 (1.50 ZL), a tourist from the UK €0.63 (£0.40 GBP) and a Latvian even as much as €0.70 (0.49 LVL) per SMS.

“Using your mobile phone abroad in the EU should not cost unjustifiably more than at home, whether for making calls, sending texts or surfing the web,” said Viviane Reding, EU Telecoms Commissioner.

“Europe’s 37 million tourists and 110 million business travellers are waiting for the promise of the borderless single market to finally have a positive impact on their phone bills.”

The Commission proposes a retail cap of €0.11 on roaming text messages (excluding VAT), combined with a €0.04 cap at wholesale level.

Roaming customers should also receive an automatic message with data roaming charges for the country they have entered. From summer 2010, consumers should be able to specify in advance how high their data roaming bill can go before the service is cut off – a measure designed to put an end to bill shocks.

These have led to customers receiving huge bills, in one case €40,000 for downloading a TV show over a roaming mobile line. In addition, a €1 per megabyte safeguard limit for wholesale fees should create a level playing field and stimulate competition.

Mobile operator 3 Ireland welcomed the Commission’s actions on wholesale pricing, but managing director Robert Finnegan said the proposed cap of 1Mbps for data roaming was “overly generous” to the industry.

“It means customers will still be subject to prices over 100 times more for data abroad than they pay at home. While the gap between national and EU roaming prices in the voice market was successfully addressed by the Commission last year, data roaming continues to suffer from a clear lack of competitive pressure at the wholesale level.

“Greatly assisting business and personal communications, low-cost data roaming can play a vital role in the EU. 3 has seen mobile internet use growing at a phenomenal rate domestically across Europe, but charging consumers exorbitant rates for simply crossing a border will prevent a pan-European market in data from taking off in the same way it has at national level.

“3 believes a wholesale cap of €0.25/ MB – as 3 has already agreed with several operators across Europe – is a level that would allow European consumers to use the internet on their mobiles the way they want to, at prices they can afford,” Finnegan said.

By John Kennedy

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years