POLICIES :: eCommunications :: The right to roam – at the right price

The right to roam – at the right price

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The freedom and convenience of the mobile phone has been a clear winner with consumers and business. The ability to keep in touch at any time, in any place has produced a highly competitive European market in mobile communications. But the costs of using your phone outside your home country have been both expensive and difficult to understand. That is why the EU has acted decisively to reduce prices.

The ability to make and receive calls via your mobile phone when abroad is one of the great advantages of the unified mobile telecommunication systems that operate in Europe and globally. Whether on business or on holiday the ability to keep in touch with friends, family and colleagues is a major benefit of owning a mobile phone.
However, using your mobile abroad – known as international roaming – often brought a nasty surprise when the bill arrived. Many users had little idea of the final cost of international roaming calls. The charges were based on opaque wholesale pricing agreements between operators.

Although extensive competition has brought the price of domestic mobile calls down within national borders, pricing for roaming calls were much higher. And this difference could not be explained by increased costs for operators. Moreover, a significant difference for roaming charges compared to domestic calls is that users are charged to receive calls whilst abroad, as well as to make them.

Roaming regulation

More than 87% of the EU population own a mobile phone. Many phone users use their phone less when abroad: mainly because of high roaming charges. This was effectively imposing an artificial economic border within Europe’s internal market and reduced the potential for service growth.

Initially the Commission sought a voluntary change in pricing from the industry and supported this with initiatives such as a public website to expose excessive roaming charges by operators.

But with national regulators powerless to intervene in an issue with complex cross-border jurisdictions and the operators not responding voluntarily to lower charges, the Commission decided to act.

Lower prices and transparency

The EU Roaming Regulation was adopted in 2007 and introduced caps on mobile roaming charges for voice calls both at the wholesale (between operators) and the retail (consumer) level. The Regulation was then revised in 2009 and covers now voice calls, SMS and data roaming via mobile phone or computer. The main provisions of this revised Roaming Regulation cut voice calls roaming prices further and introduced new caps on SMS tariffs. A cap was also set on wholesale data charges. Moreover, a monthly limit on data-roaming charges was automatically set at €50 excluding VAT (unless customers have chosen a different cut-off level) and receiving a voice mail message while roaming became free of charge (but listening to this voice mail message continues to be charged). The amended Roaming Regulation of 2009 effectively reduces further roaming charges considerably for consumers. After the so-called "Eurotariff" was progressively reduced in 2008 and 2009, in accordance with the EU Roaming Regulation of 2007, the EU's 2009 Roaming Regulation implemented new lower roaming prices cap and, further cut on roaming prices will be introduced in July 2011.

The Eurotariff caps set the ceiling for roaming charges and are set to be fair to both consumers and operators. The process should protect consumers while enabling competition to develop between operators.

Clear information on the cost of international roaming customers are expected to pay for making and receiving calls, sending SMS and using data services must be sent by operators to their customers every time they enter another EU country, via one of the following alternative mechanisms as applicable to each case: text message, e-mail or with a pop-up window on computer screens. In addition, users will receive a a warning when they reach80% of their data-roaming bill limit. Although consumer interest was the major factor in inspiring the Commission to act on roaming charges, there is also a bigger policy picture. Advanced information and communication technologies are vital for Europe’s economy and mobile services are an important part of this. Europe is a leader in the global mobile communications industry.

Next steps

Solving the roaming problem is one of the key targets of the Digital Agenda for Europe for attaining the Digital Single Market. The Roaming Regulation will expire on 30 June 2012, unless extended by Parliament and Council on the basis of a proposal from the Commission. In the meantime the Commission has the task to review its functioning and report to the European Parliament and to the Council by 30 June 2011. For more information about the latest developments, see the Roaming website.