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EU: New Survey Shows Mobile Roaming Fees Are ‘Economic Madness'

Thursday, February 20, 2014

By Joe Kirwin  

Feb. 18 --The European Commission tried to give some political impetus to its pending legislation to ban roaming fees in the European Union when it dubbed them “economic madness” after a new public survey indicated that 94 percent of EU citizens turn off their mobile phones when in another EU member state in order to avoid excessive fees.

Coming while European telecom companies are waging an intensive battle in the European Parliament and the Council of Ministers to keep roaming fees that are charged when a mobile phone user crosses EU borders, the new EU survey indicated that 70 percent of EU citizens also dramatically curtail cross-border calls due to high fees.

“I am honestly shocked by these figures,” said European Digital Agenda Commissioner Neelie Kroes in a Feb. 17 statement. “It shows we have to finish the job and eliminate roaming charges. Consumers are limiting their phone use in extreme ways and this makes no sense for the companies either.

“It is not just a fight between holiday makers and telecom companies,” Kroes said. “Millions of businesses face extra costs because of roaming and companies like app makers lose revenue too. Roaming makes no sense in a single market. It is economic madness.”

As for mobile Internet use, 47 percent of the EU survey participants said they would never use e-mails and social media in another EU country while only one out of 10 said they would use e-mails in the same way as in their resident country. Only one in 20 survey respondents would use social media in the same way as when at home.

In September the commission presented a package of telecom legislation, which included not only a ban on roaming fees in the 28 EU member states but also open access rules to ensure Internet neutrality as well as various measures to overhaul distribution of frequency use.

Industry: Give Caps Time to Work

The European mobile industry argues that the last round of roaming price caps agreed upon in 2012, which include measures to allow consumers choice on roaming rates, should be given a chance to work. In addition the European GSM Association, which represents all the leading mobile phone operators in Europe including Vodafone Group PLC, Deutsch Telekom AG, France Telecom and Telefonica SA, have also argued that without roaming fees the availability of high-speed networks for consumers will be delayed.

“The only way to ensure regulatory certainty is for the roaming III regulation to be implemented and then reviewed in 2016 as agreed in 2012 by the EU legislators,” said the European GSMA in a note published at the end of 2013 in an effort to influence the ongoing negotiations in parliament.

“Mobile network operators are intensively implementing the technically complex and resource intensive provisions on the separate sale of roaming services,” the group said. “These market driven solutions should be given the opportunity to prove their effectiveness whilst not being weakened or undermined by new provisions.

“Without cost recovery and fair use provisions there is a strong risk of impacting domestic markets.”

The European Consumer Organization used the publication of the survey to back demands for elimination of the roaming fees.

“What telecom companies must realize is that they are self-shackling their own market and consumers,” ECO Director General Monique Goyens said. “There is a dormant market there, primed to take off if only prices are brought to fair levels combined with a European Parliament vote on the issue that can confirm a 2015 deadline for the eradication of roaming charges.”

To contact the reporter on this story: Joe Kirwin in Brussels at correspondents@bna.com

To contact the editor responsible for this story: Heather Rothman at hrothman@bna.com

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