On July 1 mobile users around the EU started benefitting from the fourth consecutive reduction in mobile phone call tariffs when travelling to other EU countries. The reduced tariff structure, known as the Eurotariff, was pushed by the European Commission with the aim of bringing down the difference between local and roaming mobile charges as close to zero as possible.
When the Commission made its case and introduced the first roaming caps in 2007, Malta was singled out with a few other countries as an example of how high mobile roaming tariffs were in contrast to the national tariffs.
As from last week, the maximum per-minute roaming charge for making a voice call in the EU decreased to 35 cents a minute from 39 cents, whereas the maximum roaming charge to receive calls has dropped to 11 cents a minute from 15 cents. The cost for sending an SMS while abroad is capped at 11 cents. Subscribers are not charged when receiving SMSs while abroad.
The price which operators charge each other for data roaming also fell to 50 cents per megabyte (down from 80 cents per MB). The current regulation does not establish a retail price cap for data services.
These rates, excluding 18 per cent VAT, only apply to calls made and received within the EU. Tariffs for calls to countries outside the EU may vary.
The European Union’s retail price caps establishing the Eurotariff roaming charges first took effect on July 1, 2007. Since then, they have been progressively lowered on the first day of July of each consecutive year and the current tariffs system expires next year. However there are other benefits besides cheaper prices. These include an SMS alert sent to users when entering another EU member state and users will continue to be protected from unexpected ‘bill shocks’ for downloading data over mobile networks, as monthly bills for data downloading are limited to €50 unless the customer explicitly agrees otherwise.
Exactly a year ago the European Commission published a report indicating that, while such price cuts have temporarily reduced roaming prices during the regulated period, the current rules did not solve the underlying problem of lack of competition in roaming services and prices remained stubbornly close to the retail caps.
The Commission said this creates the need for a new regulatory intervention with a view to meeting, in a durable way, the target set in the Digital Agenda for Europe that the difference between roaming and national telecoms tariffs should approach zero by 2015. Such a target will be met if competition in mobile markets gives consumers a rapid and easy choice of roaming service at, or close to, a relevant competitive domestic price level. For this purpose, the Commission said it will very shortly be presenting a proposal for a long-term solution to the structural problems in the markets for voice, text and data roaming.
Nevertheless the situation has changed considerably in the consumer’s favour when the imposed tariff reductions came into force.
In 2001 a Maltese going abroad could expect to pay in the region of Lm0.39 (€0.91) per minute (peak) when calling from a central European country to Malta. Sending an SMS would have cost Lm0.32 (€0.75) per SMS sent. Today the tariff for voice calls is less than half and the price of SMS is only one-fifth of the price in 2001.
In 2003 the cost of sending an SMS from Malta to another foreign network was increased to Lm0.10 (€0.23), the reason given by Maltese mobile operators being “the introduction of charges by foreign mobile operators.”
In 2006 the European Commission website on mobile roaming reported that roaming prices for a four-minute call varied from as little as €0.20 for a Finnish consumer calling home from Sweden to €13.05 by a Maltese user in Latvia.
The same four-minute call to Malta could cost €8 if made from the UK, over €5 in Germany and over €8 in Belgium. Receiving a call also translated in a hefty bill for the user, with the same four-minute call by someone in Malta costing up to €4.69 if received in the UK and Italy.
In some cases, roaming prices had even increased in 2006. In the UK, one operator had increased the price for roaming from €3.45 to €4.92 when consumers call home across the EU. Lithuanian customers were charged for a four minute call from France between €4.41 and a staggering €12.08.
An EU-wide survey conducted in October 2006 showed that Maltese consumers were overwhelmingly in favour of the EU intervening to force mobile operators to lower mobile roaming tariffs, with 85 per cent of Maltese respondents thinking the tariffs at the time were too high and 82 percent saying that the EU should make sure the difference between local and roaming tariffs is not that high.
Maltese mobile users seem to have been good beneficiaries of the reduced roaming tariffs and have responded well to the reductions, which effectively prompted a wider use.
An EU survey released earlier this year showed today that the Maltese and the Cypriots are the least likely to keep their mobile phone switched off while abroad. Just six per cent would not use it and most Maltese prefer to text (78 per cent) rather than make voice calls (64 per cent) while travelling. Only 10 per cent use roaming data services while one per cent purchase a new SIM card.
However the survey found that almost three quarters of Europeans are worried about the cost of using their mobile phone when travelling in the EU. Seventy two per cent of travellers still limit their roaming calls because of high charges even if a majority is aware that prices have fallen since 2006.
Maltese mobile users can contact the Malta Communications Authority for more details on mobile roaming.
www.mca.org.mt