Wednesday, July 12, 2006

European Commission Seeks Cut in Mobile Roaming Fees

The European Commission outlined plans to slash the consumer costs for international mobile roaming. Currently, at least 147 million EU citizens are "roaming" on a regular basis and average retail prices for calls made whilst roaming are roughly 4 times higher than the equivalent prices for domestic mobile calls. By EC estimates, operators have been charging prices 300% or 400% higher than the cost of making these calls. At wholesale level, there are no agreed inter-operator tariffs for received calls, so operators could have decreased the prices without the need to change any international agreements.

Proposed regulation would establish a price cap on the charges that one operator applies to another. The regulation also states that the mark-up used to determine retail prices that are actually charged to consumers for making and receiving a call while roaming may not exceed 30%.

Operators would be free to compete beneath the wholesale cap plus retail mark-up ceiling, by charging each other less for carrying calls, reducing their retail mark-up or differentiating the packages of services that they offer according to consumer demand.

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