EU to propose caps on roamed texts, Web surfing

A woman holds a mobile phone in front of the Eiffel Tower in Paris, August 7, 2008.

BRUSSELS (Reuters) - EU Telecoms Commissioner Viviane Reding has proposed slashing the price of sending a mobile text message from one EU state to another by nearly two-thirds to 11 euro cents ($0.16), EU sources said on Wednesday.

Reding's long-awaited proposal is now circulating among all the other EU Commissioners before they formally adopt it later this month or in early October. The EU's 27 member states and the European Parliament must also approve the change.

Some 2.5 billion text messages are send every year by roaming customers in the EU and cost about 10 times more than domestic short messages (SMS).

Roamed texts represented 97 percent pure revenue for operators, Reding said in July. A roamed text currently costs about 29 euro cents to send.

The proposal also extends by three years to 2013 caps which are already in place on roamed voice calls but will steepen the rate of decline, the sources said, quoting from the draft text.

The voice roaming law was one of the most popular policies ever to come out of Brussels.

The European Regulators Group, made up of national telecoms watchdogs from each member state, said recently that due to falls in wholesale connection prices, the current caps on roamed voice calls are about 8 euro cents per minute too high.

Reding also wants to introduce billing by the second from the 31st second of a call to avoid operators charging by the minute even if the call only last a few seconds, the sources said.

This may become a point of debate as several EU states have laws that require billing by the second from the first second.

Reding is also proposing a wholesale cap of 1 euro per megabyte on using a mobile phone or laptop to surf the Web, download data or send emails, the sources added.

This compares with prices of about 3-4 euros today.

Market regulators are keen for Reding to help end the "bill shock" which travelers can suffer from huge bills after using their phone or laptop to transfer data.

A retail price cap on data roaming was not being ruled out in the final text as some in the EU executive are unconvinced that a wholesale cap would be adequate to drive down prices.

(Reporting by Huw Jones, editing by Mark John and Jason Neely)