Global Economics

EU Close to Mobile Roaming Fee Cut Deal


An agreement to cap roaming charges is expected at a meeting of the bloc's telecom officials in Germany, and it could cut fees by 70%

EU telecoms ministers are expected to clinch a deal on slashing the price of using mobile phones abroad at today's informal meeting in Germany.

But the UK warns that rigid price caps could lead to all consumers - even those not phoning from abroad - being forced to pay extra to plug the gap in company income.

Meeting in the margins of an annual technology show in Hanover on Thursday (15 March), the ministers are set to agree on an upper limit for fees that mobile operators can charge their customers.

The idea is to adopt the package in a fast-track procedure along with a vote in the European Parliament - scheduled for May - so that EU citizens could benefit from lower prices as early as this year's summer holidays.

"All citizens in the EU should be able to judge in July how effective the work of their ministers and their parliamentarians has been," said EU telecoms commissioner Viviane Reding - a staunch supporter and initiator of the roaming price cuts.

The EU executive suggested price ceilings for both wholesale and retail roaming charges which could cut rates by 70 percent and has also called for proper information to be provided to customers about the costs of calling from or receiving calls and text messages abroad.

The German economy minister Michael Glos who will host and chair the meeting on behalf of the current EU presidency has urged a "Europe-wide regulation" to provide a fair solution "on a lasting basis", according to press reports.

But his British counterpart Margaret Hodge has argued against a system which would introduce rigid price limits for roaming, saying the potential costs to companies of €2.9 billion would be spread across the sector and harm innovation in the area.

"If we have a rigid maximum price ceiling it will quickly turn into a minimum price, and that I think will inhibit real competition. You don't want to lose flexibility," Ms Hodge said in an interview with the Financial Times.

As opposed to the commission's proposal to see the new roaming limits apply automatically, Britain favours an "opt-in" regime in which the new maximum tariff is only applied if customers request it.

"People are not daft. People are pretty adept at working out the best package," Ms Hodge said in the interview.

Mobile companies make about €10 billion a year from roaming charges in the EU, according to Brussels' figures.

Since the commission set out the plan on roaming cuts, companies such as France Telecom SA's Orange, Deutsche Telekom AG's T-Mobile and Vodafone Group PLC announced lower fees which would lead to an average of 40 percent cut in roaming charges for most travellers.

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