Operators go twelve rounds but new ‘version’ of data roaming caps is still a defeat

Posted by Chris Garland Thursday, March 12th, 2009

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Operators fought long and hard with European legislators in the hope of defeating the imposition of caps to data roaming tariffs, but in the end the vote by members of the European Parliament to approve a modified version of proposed caps on wholesale mobile data and SMS tariffs for subscribers roaming in the EU, will still be seen as a defeat.

It remains to be seen whether the EC will be satisfied with the European Parliament’s version of its measures or whether operators will be forced to lower tariffs yet further.

The wholesale price cap on data downloads has been reduced to €0.50 (US$0.63) per megabyte, from the original EC proposal of €1, and SMS will be capped at €0.11 per message, in line with EC proposals. The caps will be effective July 1.

After 2010, the cost of voice calls while roaming will fall to €0.40 a minute, though the EC has called for more price reductions. MEPs also voted in favor of mandatory per-second billing for voice calls made while roaming instead of the EC proposal of charging per second starting with the 31st second of a call. However, MEPs have agreed to extend voice roaming regulation by two years, to 2012, rather than until 2013 as the EC requested.

But as if to remind operators that it is not yet over, EC telecoms commissioner Viviane Reding said somewhat ominously, “I now call on parliamentarians and member states to work together very closely over the coming weeks to ensure that the final deal on SMS and data roaming can be concluded well before the European Parliament elections in June.”

The adoption of the slightly diluted proposals will mean more deliberation before they go to a final vote in the full Parliament, which is expected in April. The EC had proposed a cut to SMS roaming prices of about 60%.

Reding has said that she remains “concerned about prices for SMS and data roaming services” and that the European Commission will monitor the cost of such services “very closely and respond appropriately by the end of 2008.”

In November, a group of major European operators, including Vodafone and T-Mobile, approached the EC’s Directorate General for Competition with an informal proposal to cap wholesale data roaming rates, in an effort to address high data roaming prices. But the DGC told the operators that if they implemented such a plan, they would be investigated for anticompetitive practices. So a fighting performance then from operators but nonetheless, still a defeat.