EU Roaming Legislation Kicks In

As from tomorrow, the new EU regulation on cellphone roaming charges comes into operation. Until now, when you crossed a border, you could immediately start paying very high charges that bear no relation to the cost of provision of the service. It is not uncommon for per-minute charges to be 5 or even 10 Euros, even though the actual cost of the connection could be measured in Euro cents. Similarly, high charges have been levied even to receive calls in a foreign land.

From tomorrow, outbound roaming calls will be limited to 49 Euro cents per minute and 24 Euro cents to receive a call. In subsequent years, the price caps squeeze prices even further with 46 / 22 respectively in 2008 and 43 / 19 in 2009.

There is now a large and growing industry in defeating roaming charges by a variety of mechanisms. Roam4free use a special SIM card that allows cost saving via a callback mechanism. Pat Phelan, CEO of Roam4free said "Roam4free version 2 is nearly ready, and this will offer calls out for 31 cents and inbound calls for 21 cents, with callers calling to a local country number". When third party companies like this can already significantly undercut the EU price caps, it makes you wonder whether the regulators have done enough?

Companies like Fring and Truphone subvert roaming charges by diverting international calls over WiFi and IP networks. There are also 'third party call control' solutions like Jajah and Raketu that can make two outbound calls close to the PSTN endpoints, and connect he call legs using VoIP, which also provides a significant saving for international calls. Although downward pressure on roaming costs from the EU does not work in favour of these companies, there is still a business that will exist there for some years to come.

Unlike directives, (which take time to be implemented) regulations have immediate force in law. However, individual mobile phone contracts may already have agreed rates, which means that not all users will get an immediate reduction in bills.

The new regulation does not cover SMS messaging or data roaming, both of which will continue operating at their normal high level of profit. So holiday makers this year and in the future will continue to return home to surprise mobile phone bills.

Link: EU Press Release

Pat Phelan is the latest interview guest on Bending the Needle.

Reply from andyk on Mar 20, 2009 - 09:48 AM

Quote:

As from tomorrow, the new EU regulation on cellphone roaming charges comes into operation. Until now, when you crossed a border, you could immediately start paying very high charges that bear no relation to the cost of provision of the service. It is not uncommon for per-minute charges to be 5 or even 10 Euros, even though the actual cost of the connection could be measured in Euro cents. Similarly, high charges have been levied even to receive calls in a foreign land.

I was looking through some old threads, and this struck me as a little odd ...

European roaming calls never cost 5 or 10 Euros per minute. And some used to be cheap - when roaming on Orange years ago for instance, some rates were a slight margin over the local rates on the visited network, such as 25 or 30 pence in France or Belgium when calls here were in the same range, or in single figures in Hong Kong.

In more recent years, even after dramatic increases, none of the British ones were over 2 Euros in Europe, and even 9 months before the introduction of this regulation, O2 had already dropped rates to 35p outgoing, 18p incoming. And more than a year before that Vodafone had introduced its Passport scheme.

There were already global roaming SIMs around some years earlier, free incoming calls in 50 to 100 countries. For call forwarding to a SIM from a landline, for a while 2 cent per minute calls were possible, and 5 to 10 can still be achieved now using VoIP providers. And several providers have callback systems, useful with local SIMs if you can't find one of an ever-increasing number of MVNOs with cheap direct-dialled calls, such as e.g. 9 cents a minute from Germany

As for data use abroad, the prospects of bulk roaming use ever being cheap seem remote, but there are more and more local SIM packages with typically €10 a month for so-called unlimited use (fair use policy in some cases)

Voip User Forum Index » The World of VoIP » VoIP News