EU to consider new plans to reduce roaming phone charges

Commissioner describes prices as a rip-off

The European Commission will have to consider radical new measures to reduce the cost of mobile roaming charges after almost all respondents to its consultation said prices were unfair.

European roaming prices are currently more than three times that of domestic charges. Even Digital Agenda Commissioner Neelie Kroes on Monday described the current charges as "rip offs." And the prices for data roaming are even higher. "The consumer often pays less than 5 cents for downloading a MB of data at home, but this may turn into 2.60 Euro per MB when the same consumer crosses an invisible border!""said Kroes.

This is despite efforts by the Commission to bring prices down. Caps on roaming were introduced in 2007. Travelers' data-roaming limit is by default set at €50 (US$67) excluding VAT and operators must send users a warning when they reach 80 percent of that. Customers may alter this limit, but the aim of the default setting was to remove the so-called "shock bill" received by many customers on return from abroad.

These rules will apply until the end of June 2012, but the Commission is due to present new plans by June this year aimed at getting closer to the target of zero difference between roaming and national tariffs by 2015.

One idea is to unbundle roaming services from other mobile services, allowing customers to purchase roaming independently of their national mobile provider. Such a move could create an entirely new telecom market.

Other suggestions include legislation to mandate a direct lick between roaming tariffs and domestic prices. "Initial indications from our consultation suggest strong support for continuing price regulation. A significant number of respondents seem to accept that some form of retail price regulation would also need to be introduced for data roaming," said Kroes.

A Eurobarometer survey, also released on Monday, revealed that 72 percent of European mobile phone users limit their voice calls while abroad because they are worried about the cost, while about one in five has cut down their use of roaming services in the past four years.

Meanwhile, Ryanair on Monday launched a roaming service together with Maxroam. Although it claims to be "the world's first free mobile phone roaming service" customers still have to pay for making calls at a fixed rate of €0.29 per minute, and for sending texts at €0.09 each. But Ryanair has also offered 1 million free minutes for incoming calls.

Follow Jennifer on Twitter at @BrusselsGeek or email tips and comments to jennifer_baker@idg.com.

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