EU announces crackdown on text roaming costsMobile phone firms accused of rip off

16 July 2008

Blue mobile phone

The European Commission has announced a crackdown on the cost of mobile phone text messages following the failure of companies to take voluntary action.

A year after slashing the cost of using mobile phones while abroad, Brussels is targeting high charges for sending and receiving mobile phone messages from another country.

The move came as a new survey showed that the 2.5 billion 'roaming' text messages sent every year by mobile users moving around the EU cost more than ten times a much as texting at home.

Cap on roaming charges

Proposals for laws capping roaming texting rates are expected in October, said European Commission President Jose Manual Barroso.

The survey by the European Regulators' Group (ERG) shows that the average cost of a roaming text message in the EU between October 2007 and March 2008 was 29 euro cents - 23 pence - but can be as high as 80 cents (63 pence) for travellers from Belgium.

A commission statement said that calls on the (mobile phone) industry for self-regulation and voluntary action had not been answered.

Mobile text price concerns

'The commission will therefore start working on measures to ensure that consumers benefit from a truly single market for mobile text services.

'The commission will also seek to put an end to 'bill shocks' that can hit roaming customers using a mobile connection to surf the internet.'

President Barroso commented: 'Europe's Single Market should be allowed to play its part, making sure that no borders re-appear on travellers' phone bills.'

'On seeing the latest price trends gathered by national telecoms regulators, I am particularly concerned by the high prices paid by consumers for text messages when they are travelling abroad. There is also a danger that European businesses are put off by non-transparent roaming costs for mobile data services.'

'Ripped off'

EU Telecoms Commissioner Viviane Reding, who led last year's assault on mobile phone roaming costs, added: 'EU citizens should be free to text across borders without being ripped off.

'Roaming charges have already drained the wallets of mobile customers too much, especially the 77% of young people who send texts while using their mobile abroad. It is not a good sign for the competitiveness of Europe's mobile industry that it still hasn't got the message that credible price reductions are needed to avoid regulation. I will therefore recommend to my fellow commissioners that we propose a regulation of SMS roaming in October.

'We will also have to discuss in which way to address data roaming, which continues to be heavily overpriced.'

Prices 

The head of the ERG, Daniel Pataki, also head of the Hungarian National Communications Authority, said: 'Based on the assessment of the market made by national regulators, the ERG found that roaming prices for sending text messages are currently too high and has highlighted the need for regulation. We welcome the fact that the commission has arrived at the same conclusions.

'In the view of the ERG, a price cap between 0.11 and 0.15 euro cents per SMS (between 8p and 11p) would be appropriate.'

Roaming website

The commission has also launched a new roaming website, to give mobile users up to date price information about the cost of sending text messages or surfing the web abroad in one of the 27 EU Member States.

Based on ERG information, the website reveals that a French customer sending a roaming text message from Italy this summer could pay up to 30 cents (23p), while a Czech tourist in Italy would pay up to 0.42 cents (33p). In Spain, a Swedish holidaymaker could pay up to 40 cents (31p) per message when roaming, a German 41 cents (32p), a Pole 45 cents (35p) - and a tourist from the UK as much as 63 cents (50p)

Commissioner Reding last February warned the industry to lower texting charges voluntarily - just as she did for roaming calls before deciding on last year's legislation.

Average text costs

She said texting prices had not budged this year, meaning average texting costs remained more than ten times higher than the price for domestic text messages.

Which? telecoms expert, Ceri Stanaway, says: 'It's a shame that companies haven't already taken it upon themselves to bring costs down for sending texts abroad, and we're glad that the European Commission plans steps to make it happen. 

'I am meeting Commissioner Redding this afternoon and will be asking her some key questions about her plans for mobile roaming in Europe, such as why she thinks it requires regulation to force companies to give customers a good deal - especially when many big companies have sister networks in lots of EU countries. 

'I'll also be asking for her current thoughts on costs for using mobile internet abroad, which can be several pounds for just one megabyte (MB) of data.'

Regulation 'unnecessary'

The GSMA, the international trade association representing more than 750 GSM mobile phone operators in more than 200 countries, said average roaming text prices had fallen 18% in the past year, and regulation was unnecessary.

'The commission's proposals to single out yet another aspect of the mobile industry and apply retail price regulation, threatens to choke growth and stifle competition,' said Tom Phillips, GSMA chief government and regulatory affairs officer.

'The commission's fixation with regulating common mobile prices across the EU is widespread. Different markets have inherently different costs, whether from variations in tax or, for example, labour rates. These services should be priced based on local market conditions, not on some vision of a single Europe, originating in Brussels.'

Packages

The GSMA says many operators have already introduced text message packages offering the possibility of roaming text rates of just 10 euro cents per message for those using their full allocation - less than suggested under EU price cap rules.

The GSMA says operators already offering special-rate 'roaming' packages include Mobilkom Austria, Orange (in France, Poland, Romania, Slovakia, Spain, UK), Telefonica (in Spain, Ireland, Czech Republic, UK, Germany) T-Mobile (in Austria, Germany, UK, Netherlands) and Vodafone (in Italy, Spain, UK).