Changing the way the people communicate

Roaming caps on calls – will business finally get a break?

Posted by talkster on May 18, 2007

By James Wanless
President and COO of Talkster

For a long time business users who travel frequently have been enduring the price of high roaming charges. A recent vote by the European parliament could finally mean this inflated pricing will come to an end. This week the parliament decided on roaming caps for both wholesale rates between operators (what the mobile carriers can charge each other for users who roam onto their networks) and retail caps (what those carriers can charge to their end customers).

The maximum wholesale rate will be €0.30 (approx $0.41). This rate will drop by 2 cents per year for 3 years.

The maximum retail rate will be €0.49 ($0.66) for calls made and €0.24 ($0.33) for calls received. These caps will fall too. Calls made will fall by 3 cents per year and incoming calls will fall by 2 cents after the first year and 3 cents after the second year.

To add a little intrigue to the whole process, consumers will not be automatically opted-in for these new rates for the first 3-months. After that 3-month period, they will automatically be switched over to the new tariffs whether they request it or not.

This makes absolutely no sense. Why would someone NOT want cheaper rates for the same phone calls? It seems that politics and lobbying play a role in all of these decisions.

For the operators it means that the all important summer holiday season in Europe will still offer one last chance to cream some profit before the caps come into effect.

Note that this vote is not yet legislation but it will be put in front of the EU parliament later this month for final approval and is expected to pass. Even after it passes, it will not likely be implemented until the end of the summer and even then there will be 3 more months before everyone gets the lower rates.

Seems clear? Not really. Tariffs will still exist where there will be a difference in the cost of calls made to various destinations. For example, if I am a UK user roaming in Spain, and I call back to the UK, will the cost be the same as if I make a call in Spain? The intention was that the cost of the call in Spain (the roaming country) would be cheaper than the cost of the call home. Unfortunately, we will have to wait to see the actual tariffs. I will be reporting back on that one when the operators have had a chance to craft their new plans based on these imposed caps.

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3 Responses to “Roaming caps on calls – will business finally get a break?”

  1. anon said

    with the wholesale rates down it means that the US operators you were really making a huge profit by charging severtal dollars a minute while roaming in europe are now making over 90% pure profit. they pay the wholesale capped price but have no retail caps.

  2. […] for many operators the cost of a call within the country you are roaming has actually gone up! I have posted on this topic before, and this result is not entirely what I […]

  3. Anonymous said

    D`Ϊ oT :)

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