The European Commission (EC) has today outlined a new set of proposals that should make it "significantly" cheaper to surf the internet from your Mobile Broadband connection while abroad within the EU. The new measures also aim clamp down on the "outrageous [data roaming] profit margins" of some operators.

At present the maximum wholesale price for a single MegaByte (MB) of EU data roaming, which is allowed under the Roaming Regulation, is €0.50 (£0.45). Operators are also required to impose a monthly default cut-off for data roaming of €50 (£45) excluding VAT. Sadly most operators have not passed the full weight of these savings on to consumers.

In order to resolve this the EC has proposed to reduce wholesale prices, introduce a new retail cap and bolster competition by allowing customers to sign up for a cheaper mobile roaming contract (separate from their contract for national mobile services). Full details below.

The New Proposals

* Retain and reduce caps on wholesale prices between operators for all roaming services until 2022 (could be removed if evidences shows sufficient competition). Current price caps for Data (€0.50), Voice (€0.18) and SMS (€0.04) would be gradually reduced (each year) to reach €0.10, €0.06 and €0.02 respectively by 1st July 2014.

* Introduce a new retail price cap for data roaming. This would begin at €0.90 per MB on 1st July 2012 and fall to just €0.50 by 1st July 2014.

* Allow consumers, from 1st July 2014, to choose an alternative provider for roaming services; irrespective of their national provider. Each time the customer crossed a border, they would automatically switch to their chosen roaming provider, without any further action on their part, while keeping the same number and subscriber identity module (SIM).

* Give all mobile and virtual mobile operators, from 1st July 2012, the right to use networks in other Member States at regulated wholesale prices, and so encourage more operators to compete on the roaming market.

The commission claims that its new price caps serve as a "mere safety-net for consumers", while they expect that the proposed competition-enhancing measures will ultimately allow the market to fix itself.

To put this in perspective. Somebody streaming a 500MB video from the internet would, after 1st July 2012, have to pay at most €450 Euro's (£403). This would fall to just €250 Euro's (£224) at the same time in 2014. That's still expensive but a recent OECD study (here) found that the average price for a single MegaByte (i.e. 1MB) of mobile data in the UK stood at around £5.20, which would push the video price up to £2,600.00!

The proposed Regulation will now be sent to the European Parliament and EU Council of Ministers for adoption. Once adopted, it would have direct effect in all EU Member States. The current Roaming Regulation expires on 30th June 2012.

Mobile Price Controls FAQ
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