Roaming rules give EU?a chance to win friends

Two MEPs discuss roaming charges

Joseph Muscat

The European Union has a golden opportunity to get its act together and show its relevance to its citizens in their everyday life. It can do this by means of a simple, transparent and effective regulation on mobile phone roaming charges. Such a regulation can make the EU relevant to the people in the streets of London, Berlin, Warsaw or Valletta much more than most pieces of community legislation one can think of.

The proposal submitted by the European Commission was an excellent effort which started the process. It set out ambitious targets, which is not always the case with proposals coming out from the Berlaymont. On the other hand, it lacked the necessary flexibility to allow competition within the regulated framework. My idea was that the European Parliament should make the original proposal more flexible. This could be done by better reflecting the real costs of operators in the roaming sector and by giving consumers an unbarred access to a much better deal.

Unfortunately, things within the internal market and consumer protection committee (IMCO) did not turn out the way many had expected, with some eleventh hour deals that are nevertheless part of the process. The end result is that the committee marginally approved a position that is a parody of consumer protection. I, for one, would have thought that a committee in charge of consumer welfare should be more ambitious in its goals.

But let us start from the positive parts. The IMCO report endorsed a number of innovative ideas, namely:

• The consumer has the right automatically to receive an SMS informing her/him about the roaming tariff in the member state being visited. If the consumer cannot be bothered with this information, he or she can ask the operator not to send such messages. Additional information would be available by means of a freephone;

• Regulators are to ensure that operators do not try to make up for lost revenue by means of unjustified increases in national tariffs;

• The limitation of the concept of traffic-steering avoids consumers being sent from one network to another without them knowing;

• The creation of an internet price simulator which would help consumers choose the tariffs best suited for them when roaming;

• Commissioning of an analysis on the situation of smaller, independent operators and their claims that they are being squeezed out of the market by larger networks.

But IMCO missed out on one crucial element. No, I am not talking about prices since that debate tends to be rather subjective. The key element which IMCO should not have given up is, in my opinion, the opt-out clause.

Let us not beat around the bush with technical descriptions that tend to raise more questions than provide answers. I, as rapporteur, wanted to ensure that whatever the EU tariff we agree upon, this should be automatically available to all mobile phone subscribers across Europe. Then it would be up to the operators to come up with more attractive packages and convince consumers that they would be better off with another offer. This opt-out position was supported by the Socialist Group, Greens and the United Left (GUE).

On the other hand, the centre-right EPP-ED/ALDE alliance managed narrowly to vote in their version, which basically states that everything stays as it is and it is up to the consumer to ask operators to switch them to the EU tariff. Such an opt-in approach envisages operators or regulators (with public funds) advertising the EU tariff. I do not think that an effective marketing campaign under this scenario is very realistic. Furthermore, the IMCO text does not provide the framework in which such a campaign should be carried out.

To cut a long story short, it is as if we agreed on a better deal for consumers but then are trying to hide it from them. That is why I voted against my own report. Let us see what happens in plenary.

• Maltese Socialist MEP Joseph Muscat is a member of the Parliament’s internal market and consumer protection committee and drafed its response to the Commission’s proposal to cap roaming charges.

Paul Rübig

Fostering the creation of a functioning internal market for telecom services is one of the European Union’s major challenges.

The proposed regulation on international roaming aims at contributing to this goal. Looking at cross-border telecommunication services in Europe today, one cannot but conclude that the current situation of the telecommunication market remains highly unsatisfactory. National competition has grown remarkably since the liberalisation of the telecommunication market and has reached a level securing both fair conditions for the operators and a high level of service quality for consumers. But this seemingly spotless sky clouds over rapidly when it comes to cross-border mobile communication and data services. No internal market has evolved over the past years. On the contrary: European consumers are faced with unjustifiably high charges and opaque pricing systems.

The proposed regulation on international roaming tariffs aims at creating a level playing-field for all operators across Europe by setting a maximum price cap for minutes traded at wholesale level. In this aspect an important element of the regulation is to base the price-cap on the costs incurred by the operators which are reflected by the average MTR (mobile termination rate) multiplied by a factor taking into account the transborder elements of roaming calls. The wholesale price cap will thus automatically be reduced by 8-12% per year following the glide path set by the national regulatory authorities for the national MTRs.

But over the last years, savings at wholesale level have not been passed on to consumers. And incentives for the telecoms industry to do so are rather low, as consumers tend to choose their operator rather on the basis of national prices than on the basis of obscure roaming tariffs. Therefore also at retail level a regulation seems necessary, providing consumers with a certain degree of protection while at the same time leaving operators enough room for manoeuvre to offer creative tariff bundles.

Parliament’s lead committee on the proposed regulation, the committee on industry, technology, research and energy, thus supported my proposal for a ‘Eurotariff’ designed to meet both requirements: granting the telecom industry a possible mark-up of 130% on top of the maximum wholesale charge of €0.23, operators are obliged to offer a tariff setting a maximum price cap of €0.40 per minute for active calls and €0.20 per minute for receiving calls. Every roaming tariff that is already today below this maximum price cap can be sustained, while all customers currently paying more than these maximum costs should be moved automatically to the new protection tariff.

But the European roaming market is not only characterised by excessively high charges but also by a serious lack of price transparency. The industry, research and energy committee has therefore adopted my proposal that customers should automatically receive an SMS with personalised price information when their device logs on to a network of a member state different from the customer’s home network. This free-of-charge SMS should be combined with a free phone number that customers can call in case they wish to receive additional information on charges for mobile data services. As a third element of the new transparency requirements, the committee calls on operators to offer consumers a true flat-rate tariff, ie, a standardised tariff-bundle including all mobile communication services. This flat-rate tariff would make it possible for consumers to compare prices and tariffs throughout Europe.

As Parliament’s rapporteur on this topic, I am convinced - as are the Council of Ministers and the European Commission - that urgent action is needed in this field. All three institutions seem to be ready and willing to create a well-functioning internal market for telecommunication services as soon as possible. I am looking forward to seeing this internal market becoming a reality - in the interest and for the benefit of our citizens.

• Austrian centre-right (EPP-ED) Paul Rübig is a member of the Parliament’s industry, research and energy committee and drafted its response to Commission proposals to cap roaming charges.

Two MEPs discuss roaming charges