EU to stop the great mobile phone roaming rip-off

No longer will phone companies be able to charge us an arm and a leg to use our phone abroad, if Brussels has its way.

by James Taylor
Last Updated: 19 Aug 2013
Here in the UK, most legislation that comes to us via the European Commission is viewed with deep suspicion, if not outright hostility. But its latest proposals are likely to be welcomed with open arms by the vast majority of Brits: it wants to make it much cheaper for us to use our mobile phones abroad, rather than having to donate a kidney every time we receive a text message on the Costa del Sol. That might include allowing us to get a separate contract for when we're overseas, or possibly capping the charges operators are allowed to levy. Good news for consumers; bad news for the mobile companies' profits...

According to the Commission's Nellie Kroes, the current rules allow operators to make 'outrageous profit margins' on data roaming - and she thinks the root cause of the problem is a lack of competition. Because customers are tied to their domestic contract provider when they go abroad, they basically have to put up with any charges levied (unless they use a totally new number, which is a pain). So Kroes wants us to be able to switch to a new provider when we go overseas. And she wants to see more 'virtual operators', who basically piggyback off the existing networks, enter the market to provide more competition and push prices down.

The Commission also wants to reduce the current price caps over the next three years. The current caps are due to expire this time next year, and the fear was that if they weren't revised, the operators would immediately (and understandably) whack prices back up to pre-cap levels. But now it's proposing to reduce them still further over the subsequent two years; so for instance, by July 2014, the per minute cost of a voice call could be no more than 22p (it's currently 31p).

The good news for the mobile operators is that data - which is the biggest cost for some users these days - remains uncapped, and will continue to be so for another year. That will ease the pain a bit (although apparently there's a general cap of €50 in place to avoid 'bill shocks' - and MT has had a few of them in its time). However, the price of a megabyte of data will be capped at 90 cents in July 2012, dropping precipitously to 50 cents by 2014. So that won't be the case forever.

As you'd expect, the likes of O2, Vodafone, Orange and T-Mobile aren't very happy about this price-capping malarkey; they'd argue, presumably, that since they fund the cost of infrastructure, licences and so on, they're entitled to reap the rewards via higher costs. But so far, their complaints been given short shrift. We imagine customers won't shed any tears if that's the case this time too.

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