European mobile phone contracts are required to charge domestic rates for calls, SMS and data use when users travel in the EU starting today (15 June), capping off a ten-year fight to get rid of roaming fees.
The EU institutions are touting the popular roaming ban as a major victory after drawn-out negotiations and several rounds of new legislation. They called getting rid of the charges “one of the greatest and most tangible successes of the EU” in a joint statement yesterday from European Commission President Jean-Claude Juncker, Parliament President Antonio Tajani and Maltese Prime Minister Joseph Muscat, who chairs the rotating presidency of the Council of the EU.
The Commission has downplayed warnings of loopholes and abuse that have dogged the legislation.
There are some catches: telecoms operators can ask national regulators to exempt them from the rules if they prove their business would suffer. Firms could also stop offering roaming altogether, meaning consumers would have no service when they cross a border in the EU. If a phone user spends more time roaming than in the country where they pay their bill, the provider can charge limited fees—capped at 3.2 cents per minute for voice calls, 1 cent per SMS and €7.7 per gigabyte of data use. Those fees will gradually fall starting next year.
Some telecoms industry sources have warned that they might have to hike up domestic rates to cover their loss from roaming.
But the Commission insists the risks are small. So far, regulators have approved only a tiny number of exemption requests from mostly small operators, according to one Commission source.
Consumers with unlimited data packages could lose out if they end up with a lower data allowance when they travel. Companies will calculate the exact amount of data those users get, according to the new EU price cap and what the consumer pays.
Despite pushback from companies, the Commission has sold the ban on roaming fees as a chance for them to cash in. If consumers use more data when they travel, they might buy more expensive packages with higher data allowances, officials argue.
“The EU just eliminated any remaining barrier for data connectivity demand to go through the roof. This can only help increase demand,” said Guillermo Beltrà, a senior legal advisor at the European Consumer Organisation (BEUC).
“I’s a great time to be in the business,” he added.
The Commission has brushed off criticism from companies by arguing that they’ve had plenty of time to get ready for the new rules. Wholesale rates, what operators pay firms in other countries to let their subscribers use networks there, have gradually decreased over the last decade.
“We made a decision at the beginning not to do it totally in one stroke because that would have meant putting into danger most of the smaller telecom companies,” said the Luxembourgish Parti chrétien MEP Viviane Reding (EPP), who first proposed the roaming phase-out in 2007 when she was the EU’s Information Society and Media Commissioner.
But Reding said the roaming ban is only one step towards knocking down digital borders in the European Union.
“The telecoms market is still divided into national markets. It will take some time before the transnational market will thrive. The way spectrum frequencies are sold is still very national and only bound to the income of ministers of finance,” she told EURACTIV.com.
EU member states have objected to a Commission draft proposal to overhaul how they auction off lucrative radio spectrum to mobile telecoms operators.
Another fight over digital borders is already brewing in the European Parliament over whether to press on with even more regulation to cut down on expensive phone calls from one EU country to another, a move MEPs say is logical after the axe to roaming costs.
Some MEPs want the Commission’s telecoms bill, which is still making its way through negotiations, to include a cap on call rates from one Union member state to another. The Commission first proposed lowering those rates in 2013, but was slapped down my national governments.
Officials who drafted the new telecoms rules now say that more regulation isn’t needed since consumers use digital services like Skype or WhatsApp to call abroad.
“There is a lot more competition now,” one official said.
MEPs who tabled amendments to lower call rates between EU countries say digital services alone won’t drive down prices.
Austrian Green MEP Michel Reimon said, “A call with an Austrian phone or Swedish phone to a Greek phone isn’t the same price as a call at home. That’s just not happening and I don’t see how that will happen in the next years.”
Reimon and Spanish Socialist MEP José Blanco (S&D) signed separate amendments calling for a cap on intra-EU call rates.
“It does not make sense,” he added.
Telecoms companies are bracing themselves for another fight.
“Continuing down the path of price regulation does not appear to be coherent with the political objective of creating a European gigabit society,” said Alessandro Gropelli, spokesman of ETNO, an association representing operators like Deutsche Telekom, Orange and Proximus.
Consumer advocates also want the EU to intervene on call prices between member states.
“Even though it should have happened hand-in-hand with the roaming reform, it should happen now. It’s never too late,” said the BEUC’s Beltrà.