Major Roaming Reductions Coming-From NY Times July 6 - Front Page Business Section

[snidely]

This sounds MAJOR to me. I'm not sure how this would affect U.S. users. It sounds like it only affects customers of carriers in the EU. I assume that all Americans would have to do is get any prepaid card from an EU carrier?
==============


In Europe, a Move to Slash Phone Roaming Charges
By KEVIN J. O’BRIEN
Published: July 5, 2011

For many tourists, it’s an experience they will long remember. After taking in the Eiffel Tower in Paris, the Coliseum in Rome or Buckingham Palace in London, they arrive home to something unexpected: a staggering cellphone roaming bill.

Jock Fistick/Bloomberg News

Charges for sending and receiving cellphone calls while traveling could fall by as much as a third.


The European Commission's proposed caps on data roaming charges will make it cheaper for travelers to use the Internet on their mobile devices while abroad.

At least in much of Western Europe, the experience may become a bit less painful.

Over the next three years, the fees that consumers pay to browse the Internet with smartphones and tablets may be cut by as much as 78 percent, under a plan being proposed by the European Commission on Wednesday. That will be welcome news to travelers, many of whom don’t realize the high cost of roaming fees until they get bills totaling hundreds of dollars or more.

The commission will propose that mobile data roaming fees, which according to the commission average 2.23 euros, or $3.22, a megabyte in the 27-nation bloc, be capped at 90 euro cents starting July 1, 2012. The cap would fall to 70 euro cents a year later, and to 50 euro cents by July 1, 2014. A minute of music or about 80 Web page downloads contain about a megabyte of data.

According to an advance copy of the plan, the charges to make a voice call while traveling, at present 35 euro cents a minute, would fall to 24 euro cents by July 1, 2014. Roaming charges to receive a call, and to send a short text message, would fall to 10 cents from 11 cents by the same date.

The commission’s proposal, which was prepared by Neelie Kroes, the commissioner for telecommunications, will require approval by the European Parliament and the Council of Ministers in a process likely to conclude next spring.

Paul Rübig, a member of the European Parliament from Wels, Austria, said Mrs. Kroes’s plan would probably receive broad backing. “I think this proposal will receive massive support in both the European Parliament and in the Council of Ministers,” said Mr. Rübig, who was the legislative sponsor of the original roaming bill.

“The roaming regulations,” he added, “have become a symbol of how the European Union can function in the interests of its citizens.”

Operators, however, criticized the plan by Mrs. Kroes, a Dutch economist, saying that the reduced retail price caps on voice calling and new retail price controls on data would discourage investment in faster mobile networks.

“The retail data roaming market is growing quickly and prices are falling fast,” said the GSM Association, the group based in London that represents most of the world’s mobile operators. “We are convinced that competition can flourish in this market — if all regulators are prepared to favor it.”

Consumer advocates, for their part, were supportive but said that the caps were not set low enough to spur competition.

Nearly three-quarters of Europeans, according to a study by the European Consumers’ Organization in Brussels, limit their mobile phone calls while traveling within the European Union to avoid roaming charges. Voice roaming calls, said Monique Goyens, the director general of the Brussels-based group, typically cost three times what consumers pay domestically; data roaming charges can be up to 50 times what consumers pay in their home markets.

“The current cap of 90 cents per MB is a slow start,” Ms. Goyens said, referring to the proposed retail data roaming cap per megabyte. “Consumers should not be ripped off for surfing the net abroad. It’s blindingly obvious that fair pricing is only possible when the lack of competition is solved.”

Nick White, a spokesman in London for an association that represents corporate users of European telecommunications including MasterCard Europe, Philips, Pfizer, Toyota, Johnson & Johnson and BNP Paribas Fortis, said that Europe’s system of roaming charges should be abolished by 2015.

“The latest retail price cap proposals demonstrate acceptance by politicians and regulators that roaming charges are an unjustified imposition on consumers and a stealth tax on cross-border trade which relies increasingly on mobile data communications,” said Mr. White, the executive vice president of the International Telecommunications Users Group. “However, they still do not go far enough in eliminating this particular symptom of market failure.”

Mrs. Kroes’s proposal on roaming is a compromise reached after weeks of consultation with consumer and industry groups. In the weeks leading up to a planned announcement on Wednesday, Mrs. Kroes fought for the retail cap on data roaming, while giving operators an additional 2 cents per short message on text message roaming, which had originally been set to fall to 8 cents by mid-2014. SMS is still the largest single source of data revenue for most operators.

The first retail price controls on mobile roaming charges took effect on July 1, 2007, and were adopted by European lawmakers in the face of heavy industry opposition. Since then, retail caps on voice calls and short text messages have been lowered each year according to a schedule in the original legislation. The initial price controls regulated mobile data roaming fees only at the wholesale level, which limited the price that operators could charge each other to carry each other’s calls.

While operators have adhered to the wholesale price limit, which is currently 50 cents per megabyte, they continue to charge consumers a multiple of that rate at the retail level. The practice prompted European Union lawmakers last year to set a 50-euro limit on what operators could charge consumers for data roaming in a single month.

But because operators bill at such a high rate for data roaming — at about 15 cents per kilobyte of information in France, for example, which is roughly the amount of information in this paragraph — consumers typically reach that limit within a few hours of downloading standard e-mails. Once the limit is reached, many operators slow service for the rest of the month.

Besides lowering the retail caps and introducing new controls on mobile data, the commission is proposing that consumers be given the option of buying a roaming package separately from their regular mobile operator.

The proposal also will try to give mobile service resellers the right to lease bulk access to the networks of mobile operators at the same price that operators charge each other.

John Strand, a mobile industry analyst who specializes in such resellers, said the commission’s proposal, by setting uniform limits on data roaming across the European Union, may have the unintended effect of squeezing out small companies that have already started to sell roaming packages.

“While the data caps will limit what the big operators, such as France Télécom, Telefónica, Vodafone and T-Mobile, can charge, they will also limit what the smaller, niche players can make,” said Mr. Strand, who is based in Copenhagen.

But Bengt Beier, a student from Augsburg, Germany, who is studying political science at the University of Salzburg in Austria, said lower roaming charges were overdue.

A year ago, Mr. Beier and 1,300 other students across Europe formed a group called Europeans for Fair Roaming, which is advocating lower charges.

“I can tell you that it doesn’t go far enough,” Mr. Beier said. “I just received four e-mails with about 32 megabytes of combined photos. If I were to have downloaded those over my mobile operator, I would have paid about 30 euros. That’s crazy.”

[inquisitor]

This article omits the probably most exciting proposal of Neelie Kroes' recent foray, which also intends to allow consumers chosing an alternative roaming provider while keeping their original SIM card and phone number:

Originally Posted by http://europa.eu/rapid/pressReleasesAction.do?reference=SPEECH/11/502&format=HTML&aged=0&language=EN&guiLanguage=en

On the demand side, we want to give consumers more transparency and more choice. Our proposals would offer them the right to choose an alternative provider for EU-wide roaming services, benefiting from lower prices, while keeping their usual provider when they're at home.

If people do opt for a separate roaming contract, the phone will automatically switch to their pre-selected roaming provider when travelling - using the same phone number and without changing their SIM card every time.

and

Originally Posted by http://europa.eu/rapid/pressReleasesAction.do?reference=IP/11/835&format=HTML&aged=0&language=EN&guiLanguage=en

Letting consumers 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 card). This would enhance transparency and allow customers to shop around for the best roaming offers and encourage operators to offer more competitive roaming deals.

and

Originally Posted by http://europa.eu/rapid/pressReleasesAction.do?reference=MEMO/11/485&format=HTML&aged=0&language=EN&guiLanguage=en

How would people buy a separate mobile phone roaming contract?

As of 1st July 2014, all EU customers would have the option to sign up for a mobile phone roaming contract, which would be separate from their contract for national mobile services, while keeping the same phone number. Consumers would not be obliged to do this; but some mobile phone users may find that a different operator for roaming would offer more interesting prices or deals.

Mobile phones operators would have to inform their customers from 1st July 2014 that they had the option to buy a separate roaming contract.

From that date, if you took out a new domestic mobile phone contract, you would also at the same time be able to select a separate mobile roaming provider.

The additional competition brought through this measure would generally bring prices down, so that consumers who do not choose to buy a separate roaming contract would also benefit.

I really like this idea of virtually opening the SIM card to third party providers. Actually there are already similar solutions in some countries like Saudi Arabia and Mauritius, where inbound roaming customers may subscribe to a prepaid plan of the local MNO using their existing SIM card. After subscription and topping up credit (with local topup vouchers of course) roamers can call at the local MNO's rates (deducted from the local prepaid credit) and will be assigned a local number. While this sounds pretty interesting, I think this involves some legal and technical problems. First of all roaming agreements between operators surely prohibit such "hijacking" of customers and secondly bypassing the home operator (and issuer of SIM-card) may have an impact on the authentication process, which is performed between the SIM-card in the mobile terminal and the AuC (= authentication center, usually integrated in the HLR). At least there won't be any encrypted communication without access to the HLR (this is an issue in Lybia where rebels have separated GSM networks and "hijacked" customers, see Free Libyana: Gadaffi networkjacker speaks! ? The Register).
With Neelie Kroes' help these issues will of course be solved. However from my understanding the EU intends to establish firm roaming providers you would subscribe to and who will permanently provide roaming service throughout the whole EU. This would mean people would again have to struggle with different operators and do paper work to switch operators, which would slow down competition. I would rather prefer if people could chose a provider each time they visit another EU country. There should be an APN (access point) and webserver reachable from every EU network free of charge, through which roamers can check and chose a provider and tariff and all the usage would be billed either by credit card or by the home operator.
If this will become reality there would be no need for capping tariffs because competition would drive down prices significantly below those proposed rates.

[weekilter]

It probably only applies to roaming rates within the EU. People are probably stuck with high rates if they're roaming in non EU countries.

[inquisitor]

Yes, all existing and future EU regulation does only apply to roaming within the EU.

[DRNewcomb]

Originally Posted by inquisitor

Actually there are already similar solutions in some countries like Saudi Arabia and Mauritius, where inbound roaming customers may subscribe to a prepaid plan of the local MNO using their existing SIM card. After subscription and topping up credit (with local topup vouchers of course) roamers can call at the local MNO's rates (deducted from the local prepaid credit) and will be assigned a local number.

This sounds a lot like the "Zebra roaming" proposal I saw published many years ago. The one disadvantage is that it uses only the SIM ID number for account validation with no encryption. I have roamed on a carrier in Indonesia who assigned me a temporary local number for incoming calls. I forwarded my US main incoming number to this local number and, as we all know, it's pretty easy to turn a cheap incoming line into a cheap outgoing line. It worked quite well.

[snidely]

Originally Posted by inquisitor

Yes, all existing and future EU regulation does only apply to roaming within the EU.

Would non EU citizens simply be able to buy a pre-paid SIM from a EU carrier and use it to roam anywhere in the EU? Can that be done now?

...mike

[Bossman]

Yes. You can do this now. Some of us non-EU citizens on here have had UK (and other EU countries) sims for years. You can certainly get these on ebay or when you get there. When I am traveling within EU, I just use my UK sim.

Originally Posted by snidely

Would non EU citizens simply be able to buy a pre-paid SIM from a EU carrier and use it to roam anywhere in the EU? Can that be done now?

...mike