Mobiles with Strings Attached?

November 3, 2010

Stay home or shut up

Previous reforms aren’t enough to keep up with the increasingly borderless community of the European Union.

Within the Single market of Europe, there is still at least one huge obstacle to overcome, The telecommunications market. There are regulations for all European players in this field, but it’s not enough. The European Parliament and Council of Ministers have agreed on Telecoms Reform, and the new rules will have to be transposed into the national laws of the 27 member states by May 2011.

Telecommunication is very central to our daily life, with the number of call you make on your mobile phone increasing on a daily basis. Though it is both convenient and efficient, you’d better be sure to stay within your country’s borders or risk the possibility of your monthly bill going through the roof.

Many of us don’t stay within national borders, as they don’t mean much anymore. This is just another developing aspect of the mobile phone life, and an obvious necessity for an increasingly borderless society.

Gunnar Hökmark is a Swedish representative to the European Parliament. He


argues in favor of telecom industry consolidation, and getting rid of roaming charges for anyone traveling between EU countries and mobile markets. In an interview with the Deutsche Welle, he says that, “the long-term solution is to get rid of the reasons for why you have roaming at all. Those are the factors that explain why it’s more expensive to make a call from southern Sweden to Copenhagen – a distance separated by just a few kilometers – but much less expensive to call places hundreds of kilometers away in northern Sweden.”

“That’s why I want us to have pan-European solutions and create one internal market,” said Hökmark, who continues to explain how the development of the telecommunications market is crucial for how the rest of the markets will develop.

“It’s not just about telecommunications as such, but about the opportunities telecom enables,” said Hökmark.
Some of the main elements of the reform include better consumer information, protection of consumers against personal data breaches and spam, as well as accelerating broadband access for all Europeans. Furthermore, there will be a new European Telecoms Authority, BEREC (Body of European Regulators for Electronic Communications). Decisions of BEREC will, by law, be made through majority vote by heads of the 27 national telecoms regulators.
Many are anticipating debate on this topic due to the large-scale reform it envokes, however, this change is seen as a dire necessity to maintain the Union’s position as a frontrunner in the telecommunications industry. A passage within the legislation includes that “The choice for the EU is clear: reform or decline.”

“I think this is important for integration reasons but also for reasons relating to competitiveness,” said Hokmark, “by going forward on this proposal, we can develop more new services. Europe has been a leader regarding mobile Internet, but we risk losing that advantage if we can’t open up new opportunities.”
And for consumers, traveling, studying or working cross-border in Europe, waiting for more concrete actions from the EU will be a time of costly bills for their efficiently-mobile approach to life.
The recent legislation comes in the wake of previous work in Brussels to create, and consecutively lowered a cap for the maximum cost to call between any two member states.

Previous Telecomm Reform

The first set of reforms in 2007 limited creating a cap at 49 cents per minute for making any call made between two member


Sample tariffs for four-minute peak time call in March 2006. Prices vary according to which UK network and host network are used. Source: European Commission

Calling the UK from Italy: 3.5-5.81 euros (£2.42-£4)

Receiving a call in Italy from the UK: 1.75-5.50 euros (£1.21-£3.80)

Calling the UK from Malta: 3.5-7.34 euros (£2.42-£5.06)

Receiving a call in Malta from the UK: 1.75-5.50 euros (£1.21-£3.80)

Calling France from Germany: 4 euros (£2.76)

Receiving a call in Germany from France: 1.36-1.88 euros (94p-£1.30)


states, with a 24 cent charge for receiving the call.

Viviane Reding - from

Prior to the initial reform, BBC news reported that the cost for a person from Malta to make a four-minute call home while in Latvia would cost more than 11€.

Initial proposals for the cap were made by Telecommunications Commissioner Viviane Reding, who told BBC that the reason for the legislation was that “You should be welcome when you cross a border, and communicate freely without feeling the surcharge on your bill.”

The commissioner then explained that the reform sparked a dramatic increase of cell phone usage. In the months following the new legislation, there was an increase in roaming calls by 30-35% after the EU cut the roaming charges by 50-60%.

However, not everyone is excited about the move toward cell phone freedom in Europe.

“Price regulation is the most intrusive form of market intervention and we regret that EU legislators have decided to extend the duration and scope of the Roaming Regulation,” said in a statement released by GSMA, a company representing mobile technology and business interests worldwide, “even as they recognise that price regulation of roaming services should be ‘exceptional and temporary.”

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One Response to Mobiles with Strings Attached?

  1. peter.verweij on November 5, 2010 at 4:45 pm

    he man, very good story. I like it: scanable lay out, pictures, links to docs and a factbox. Deep analysis of the problems, quotes from politicians. well done!

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