EU wants lower roaming costs, provider choice for mobiles

Jul 6, 2011, 12:35 GMT

Brussels - Mobile phone users traveling in the European Union may soon be able to choose which service provider they would like to use once they cross a border, under a plan unveiled Wednesday by the European Commission

The move is a bid to lower so-called roaming costs.

In the meantime, the commission also wants customers who use mobile devices who make a call, send a text message or check emails while outside their home country to continue paying progressively less to do so.

'A mobile should be mobile. But many people currently switch off their phones, smartphones and other mobile devices when travelling to another EU country,' said Neelie Kroes, the bloc's digital agenda commissioner. 'Customers get a raw deal when they cross borders.'

They can currently be charged a maximum of 35 euro cents (50 US cents) per minute for making a call in an EU country different from the one where a phone is registered, excluding value-added tax.

The price cap for receiving calls is 11 euro cents per minute, the same as for each text message sent or received.

'Within a single market, there is simply no justification for huge markups, just because you've crossed an invisible internal border that is supposed to have disappeared,' Kroes noted.

Under the commission's proposal, those prices would incrementally decline to reach 24 cents per minute and 10 cents per minute respectively by July 2014 - building upon previous EU regulation that has steadily reduced roaming prices since 2007.

The proposal also seeks a price cap for each megabyte of internet data downloaded or uploaded from abroad, starting at 90 euro cents per megabyte in 2012 and falling to 50 euro cents by 2014.

Those services do not currently have a retail price limit, allowing operators to benefit from what Kroes described as 'outrageous profit margins.'

But more is needed than regulatory price limits to achieve the eventual aim of having a negligible difference between home and roaming mobile prices by 2015 - namely competition, Kroes said.

To encourage mobile phone providers to slash prices below the price caps, the commission wants to make it possible for customers to pick which provider they would like to use for roaming services from 2014. Currently, their home provider makes that choice for them.

As envisioned by the commission, the provider switch would occur automatically once a customer crosses a border, not requiring any extra action or a change in phone number.

'This would ... allow customers to shop around for the best roaming offers and encourage operators to offer more competitive roaming deals,' it said.

As part of that, the proposal would also force mobile operators to give competitors from other EU member states access to their networks at wholesale prices starting in 2012.

Kroes said she expects the measures to lower prices so significantly that the caps will be unnecessary by 2016.

'This is a big step forward,' she argued. 'It's rocking the boat.'

The proposal needs to be endorsed by EU governments and the European Parliament to become law, and could be amended significantly during the process.