EC praises 3 roaming cuts

European Commission claims 3's surprise move backs up its regulatory proposals, but operators say it shows regulation is unnecessary

The European Commission has welcomed the move by mobile operator 3 to stop charging customers for roaming between its networks, while other operators have claimed 3 has not broken ranks with them.

On Tuesday, 3 announced that from this month it is removing all surcharges for its customers when they use their 3 mobiles on the company's networks in other countries. The move included all aspects of mobile usage, from voice to data.

"This announcement shows that there is room for reducing current prices for international roaming, as was proposed by the Commission," a spokesperson for commissioner Viviane Reding, who has long been pushing for operators to cut their roaming charges, said on Wednesday.

The spokesperson added that some operators in other European countries had already dropped their roaming surcharges, but declined to specify which companies or countries.

Reding's campaign has successfully forced cuts of up to 70 percent in wholesale charges, which networks charge each other to interconnect customers. Retail charges — which customers are charged by their own operator — could follow. The threat of legislation has seen operators start to reduce the charges over recent months, although the operators themselves have claimed that their cuts were a natural progression according to market forces.

Approached in the wake of the launch of the "3 Like Home" pricing strategy, operators' reactions followed similar lines. "It just goes to prove that the market is delivering lower prices for customers," said a spokesperson for Vodafone, who insisted that Vodafone's own Passport roaming add-ons offered "great value to our customers in terms of voice and data across Europe".

"Customers understand there are costs associated with connecting calls across Europe," Vodafone's spokesperson added.

Orange said it shared the Commission's "vision of simple, seamless communications for all customers", pointed to roaming cuts of up to 25 percent that it announced last year and hinted that it would be announcing "further refreshes" to its roaming rates in the first half of this year.

A spokesperson for O2 also highlighted its roaming deal, My Europe, which it launched last year, and said the deal — currently available only in Spain, as that is "the destination of over 20 percent of all trips abroad made by the UK" — would be...

...extended across the continent from 1 February.

T-Mobile's reaction was to welcome 3's move and echo Vodafone in saying it proved the industry did not need legislation to force down prices. "Anything which reduces prices for consumers is a good thing," T-Mobile's spokesperson said, before suggesting that the reason people are hesitant to use their phones abroad is not only a matter of it being expensive, but also due to a lack of transparency.

"What we did [lowering international roaming charges in 2006] was not just about reducing prices, it was about having flat-rate pricing across Europe and North America," the spokesperson said. "It's about keeping it simple. The net result of that and the proof it is working is that usage figures are way up — since we did this, a few months in, we saw usage increase by up to 50 percent in some countries."

T-Mobile's spokesperson also highlighted the fact that 3's deal leaves out many popular European destinations where 3 does not have networks. "If you roam onto someone else's network you revert to higher roaming rates. To me that's not transparent," said the spokesperson, adding: "This doesn't do the industry any good."

Interestingly, the spokesperson refused to deny that T-Mobile might follow 3's policy, and suggested that T-Mobile is looking at revising its data-roaming policy again. Last year a senior executive admitted the company was "screwing" its customers in this regard.

"Roaming is one of those issues which has become highly emotive in the customer base," said Gordon Rawling, portfolio product marketing manager at telecommunications CRM provider Amdocs, on Wednesday.

Rawling pointed out that operators have come under pressure not only from the European Commission, but also from consumer groups. "At the end of the day they can't afford that level of emotional dissatisfaction in the consumer base," he told ZDNet UK, describing 3's move as a natural continuation of recent trends towards lower roaming charges.

"We won't necessarily see one consistent approach [among operators], as in everybody going to 'free', but we will see everybody address the pressure with those kinds of packages," Rawling added. "Hopefully this will make it much more transparent [although] you can't get a lot more transparent than free, which is the approach that 3 have taken."

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