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EU to propose caps on roamed texts, Web surfing
September 3, 2008 / 2:33 PM / 9 years ago

EU to propose caps on roamed texts, Web surfing

BRUSSELS (Reuters) - The price of texting from one EU state to another would tumble nearly two-thirds to 11 euro cents ($0.16) under proposals from EU Telecoms Commissioner Viviane Reding, EU sources said on Wednesday.

Reding’s long-awaited proposal is circulating among 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, which builds on EU legislation which substantially cut fees using a mobile phone abroad.

Some 2.5 billion text messages are sent 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.

The cap on the cost of making a roamed voice call fell to 43 euro cents a minute on August 30.

NO INTERVENTION

The GSM Association, an industry lobby with members such as Vodafone, Orange and Telefonica said there was no case for regulatory intervention in the roamed texts sector and a comprehensive analysis of price caps on roamed voice calls has yet to be made.

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.

“The regulation of billing increments within the Eurotariff or any other roaming tariff would amount to micro-management. Billing increments are a point of differentiation that operators can use to appeal to customers with different preferences,” the GSM Association said.

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.

“Wholesale charges for data roaming services are falling dramatically without regulation,” the GSM Association said.

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.

Editing by Mark John and David Holmes

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