‘Roam like at home’ now live in Europe, but some operators seek exemptions
A milestone was finally reached in the European Union on 15 June when roaming charges were eliminated under the ’roam like at home’ banner. As an EU statement says: “Over the last 10 years, our institutions have been working hard together to fix this market failure. Each time a European citizen crossed an EU border, be it for holidays, work, studies or just for a day, they had to worry about using their mobile phones and a high phone bill from the roaming charges when they came home. Roaming charges will now be a thing of the past… It has been a long time coming, with many actors involved… Operators have had 2 years to prepare for the end of roaming charges, and we are confident that they will seize the opportunities the new rules bring to the benefit of their customers.” Mobile operators in a given EU country must include roam like at home by default in contracts they offer to people who live in that country. It is not though meant to be used for permanent roaming. The operator can question the residence of customers who spend more time abroad than at home. Costs that can be charged are a maximum €0.032 per minute for a voice call, 0.01 per SMS, and €7.7 per GB of data (from 1 January 2018, €6.00 per GB, which will decrease annually to €2.50/GB by 2022. Wholesale prices will be reviewed in 2019). However, as the Financial Times reports, smaller networks, particularly in the Baltic and Nordic regions as well as countries including Belgium, have applied for exemptions to avoid the new rates. “Operators in the Nordics expect a drop of between 1% to 3% in earnings before interest, tax, depreciation and amortisation, according to Bengt Nordstrom, chief executive of Northstream, a telecoms consultancy. Industry group ETNO had previously estimated that scrapping roaming charges would cost European telecoms groups roughly €7bn in lost revenue by 2020.” Fair use rules designed to protect mobile operators from heavy losses mean that, if roam like at home knocks 3% or more off an operator’s net margin, they will be allowed to introduce roaming fees, subject to permission from their national regulators. Companies in countries where allowances are generous and cheap, such as the Nordics and the Baltics, are the most likely to use this loophole. FT item here.
- Tuesday, 20 June 2017