3UK Tells Vaizey To Veto Weak EU Roaming Cuts

A European plan to reduce mobile phone data roaming charges doesn’t go far enough, Communications Minister Ed Vaizey has been told by mobile operator Three UK 3, along with a number of consumer and business groups.

Vaizey has been chanllenged to veto the European plan, in an open letter from 3, along with uSwitch.com, and Which? Three trade bodies (the Federation for Small businesses, the Federation of Communication Services, and INTUG) also signed up to the letter. Notable absentees were Vodafone, O2, and Everything Everywhere.

Open Letter

The letter comes as the European Union readies to set controversial price curbs that will fix until 2022 what mobile operators can charge users when using data roaming aboard.

“In the next few weeks a vote will be taken by Europe’s communications ministers that will determine how much consumers pay for accessing mobile services when they are abroad until 2022,” said the letter to Ed Vaizey.

“The biggest risk surrounds the pricing levels that will be set for consumers using data on their phones when they are on holiday or away on business,” it warned.

Three UK and its friends believe that the cost cuts to mobile data rates do not go far enough, because by “by 2014 they will still see a rate tantamount to £400 for 1GB of mobile data, compared to UK domestic prices of under £10,” the letter warned.

“At the root of high retail prices are the wholesale prices operators charge each other. If the maximum amount one operator can charge another at the wholesale level is limited, competition between operators will lead to lower retail prices for consumers,” it said.

“Yet the Commission is proposing a wholesale cap more than 10 times higher than domestic retail prices,” it said. “This means that if the proposals become reality, using the internet on your mobile phone in Europe could end up costing more than the trip itself. This is an issue for consumers and businesses alike. It is prohibitively expensive and, in the worst case scenario, stops firms from doing business abroad entirely.”

“Data usage on mobile devices is exploding and the Commission’s proposals in their current form do not address the demand for data in 2012, never mind 2022. These pricing levels do not encourage competition and hence could put the brakes on growth and competition in the EU,” the letter stated.

“There is another way. MEPs have tabled amendments that would see the wholesale price reduced to less than 10 euro cents per MB (down to around 5 euro cents per MB at the end of the three year glide path),” said the letter. “We urge you to use your vote in the European Council to support an even greater reduction in data prices for people and businesses travelling abroad.”

Sensitive Move

Data roaming is a highly sensitive subject, espicially because many holiday makers often find themselves facing bills of thousands of pounds when they return from holiday.

Last July, new regulations forced all European operators to implement a monthly default cap for data roaming of €50. If users exceed this amount whilst aboard Internet access is automatically choked off, unless by prior agreement. But holidaymakers outside the eurozone are not guaranteed such protection.

However the EU data roaming plans are also currently facing a hostile reception from some big name mobile operators.

In December during an European Parliament debate, Telefonica, the Spanish owner of British operator O2, reportedly made clear its concerns about the EU proposals to reduce roaming charges. It argued that the proposals were too strict and could reduce competition.

Roaming Campaign

Meanwhile there is an ongoing European-wide campaign against high roaming charges (especially for data) in the EU and further abroad, called “Europeans for fair roaming.”

“While many of the proposed amendments to the new EU roaming regulation are going in the right direction, the discussed price caps are still much too high,” Europeans for fair roaming warned.

“The retail price caps for mobile phone users must be set at lower levels than what is currently proposed,” it added.