European Parliament Expected to Approved Fixed Wireless Roaming Rates

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European Parliament Expected to Approved Fixed Wireless Roaming Rates

1:59 am on May 23, 2007 | Category: Business, Telecom Services, Wireless, Regulation, Editorials

The European Parliament is expected to vote in favour of a popular plan to limit wireless roaming fees across the continent, in recognition of the high volume of cross-border travel within the 27-nation European block.

The EU’s aggressive plan will force carriers to cut roaming fees — that is the added cost of using one’s cell phone on a foreign network — by up to 80%.

“Consumers will save quite a bit of money,” noted the leader of Europe’s Socialist Party, Martin Schulz.

Assuming that the motion passes, roaming tariffs throughout the EU will be reduced to a fixed rate of €0.49 for making calls abroad and €0.24 for receiving them. These rates would be further reduced to €0.43 and €0.19, respectively, over the next two years.

Although intended as a consumer protection measure, many of Europe’s leading cell phone operators are warning that these radical cuts could reduce competition and service quality in the wireless roaming market, while increasing domestic wireless rates.

A study conducted last summer by the research firm, Gartner, meanwhile, asserts that fixing roaming fees across the continent would upset a delicate balance in the telecom market, even damaging the GDPs of some tourism-heavy countries in southern Europe.

The price fixing measure is sure to buy EU lawmakers some popularity in the short-term, but it could easily come back to haunt them as consumers are faced with a plethora of new fees and expenses elsewhere.