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Roaming prices down 22% but is it enough?

The European Commission and the region’s mobile operator community remained at loggerheads on Tuesday, as the argument over mobile roaming charges escalated further.

On one side, the GSM Association (GSMA) wheeled out a retail price index compiled by research and consultancy house AT Kearney, which claims that the average price for making and receiving mobile calls when roaming within Europe has fallen by 22 per cent in the last year.

According to the statistics, the average price of making and receiving a call while roaming has fallen to Eur0.65 (£0.44) per minute from Eur0.83 per minute in 2005.

But the EU’s Information Society and Media Commissioner, Viviane Reding, blasted this figure with her own Europe-wide survey, published by Eurobarometer, which claims mobile users continue to pay between Eur4 and Eur6 for a four minute call abroad and in some cases can even end up paying Eur12.

“Reducing roaming prices is not only a political responsibility of the European Commission, but can also be an interesting business model, as demonstrated by some operators who have started to move in this direction in recent months with the introduction of special roaming packages,” said Reding.

However, the GSMA maintains that the roaming cuts implemented so far are due to competition and not to the actions of Reding and the Commission. Reding has largely been credited with triggering a price war amongst European operators apparently desperate to make a pre-emptive strike against the proposed regulation.

“This summer, roamers paid substantially less to make and receive calls than they did in 2005 and we believe roaming tariffs will carry on falling,” said Tom Phillips, chief government and regulatory affairs officer at the GSMA.

“The European mobile market is highly competitive and competition continues to drive lower prices and innovative tariff packages. However, the rigid roaming regulation proposed by the European Commission would stifle operators’ efforts to tailor new tariff packages to meet the needs of different customer groups and mobile users could be left worse off,” he said.

But consumers and Reding herself will probably see the GSMA’s announcement as proof that the operator industry is less than half way towards the EC’s proposed 50 per cent cut in roaming tariffs by 2007. According to the Eurobarometer report, 70 per cent of respondents to the survey support the need for EU intervention to lower roaming costs.

“It is not acceptable that the burden of international mobile roaming continues to be shouldered by ordinary citizens who pay standard tariffs,” Reding said.

But while many of Europe’s leading mobile operators have indeed launched tariff packages with discounted roaming rates, as Reding points out, the GSMA protests that “some of these packages, which offer lower per minute rates in return for a connection charge or fixed monthly fee, would be outlawed by the Commission’s proposed regulation”.

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