Some EU roaming charges could plunge 80% or more in July

With what European telcos have been charging their customers for mobile movie downloads, they might have been able to fund the entire movie. Smartphone users in Ireland, for example, were being charged as much as €6.82 ($9.55 USD) per megabyte of bandwidth, when their phones roamed outside their service areas. Telcos had been blaming the high cost of interstate commerce for these extraordinary roaming rates.

But an agreement announced yesterday between the European Council of Ministers -- the coalition of telecom ministers of the EU's member states -- will effectively force those states to find a way around that problem. Starting Wednesday, July 1, telcos may only charge no more than €1 per megabyte (about $1.40 USD) for roaming download charges. In addition, SMS messaging charges across service boundaries (which usually means, across countries' borders) will be capped at €0.11, which is about one-third of what some Portuguese customers have been paying.

The European Parliament had reached an agreement in principle in April to implement service caps for roamers and interstate customers; what remained to be decided was by how much. Yesterday's decision means price caps will go into effect prior to the peak summer travel season.

EU Commissioner Viviane Reding, whose purview is the entire digital communications sector, stated yesterday, "This is great news for European citizens who will be able to go on holiday this summer and roam with peace of mind and without the fear of 'bill shocks.'" Comm. Reding is referring to a favorite portion of the legislation which passed the Council of Ministers: By law, EU customers will be given some type of mechanism where they can cap their own monthly bills at €50 per month, or higher as customers may choose. This way, they can have telcos automatically suspend services that are beyond their budgets.

The price cap might have been passed in 2007 had it not been for the United Kingdom, whose ministers then opposed automatic caps, saying they would result in half a billion euros of lost revenue for telcos such as BT. Ministers there said at the time they feared telcos would compensate by raising the cost of subsidized handsets by an average of £25.