Thursday, May 10, 2012

Press Release: More savings for mobile roaming services including cheaper data downloads

32 Smith Square, London SW1P 3EU -

10 May 2012

More savings for mobile roaming services including cheaper data downloads
From this summer, holidaymakers and business travellers will begin to see significant savings if they use maps, emails, social networks and other data downloads abroad.  From 1 July 2012 the European Union's mobile roaming regulation will be extended to include price caps for data downloads resulting in the cost of downloading data or browsing the internet being capped at 70 cents per megabyte, plus VAT.  This is six times lower than 2009 prices.

"Bill shocks" should become a thing of the past for anyone travelling outside the EU.  Also from 1 July this year consumers will get a warning text message, email or pop-up window when they are nearing 50 euro of data downloads, or their pre-agreed level.  They will then have to confirm they are happy to go above this level to continue data roaming.  Currently this alert system is only operational within the EU.

From 1 July 2014 customers will have the option to shop around for a separate mobile roaming provider, either through a contract or by choosing a provider at their destination - like they would choose a wifi network - whilst keeping the same number.

Commission Vice President Neelie Kroes said: "By putting price caps on data we have created a roaming market for the smart phone generation. More than that, we have ended the rip-offs familiar to anyone who has used a mobile phone while travelling abroad. I am pleased that year after year the European Union is putting money back in the pockets of citizens."

"From 2014 we are also delivering a permanent solution to the roaming issue, something better than any price cap. We are bringing full competition to this market by making it easy to choose a separate roaming provider. If you can find a better offer compared to your standard contract you'll be able to do it in a few simple swipes, just like when you choose a wifi network."

From summer 2012: data downloads get much cheaper
Since 2007 the EU has placed price caps on calling and texting. Now data is being brought under the same system.

The new prices caps which enter into force on 1 July 2012 are:
  • 29 cents per minute to make a call, plus VAT
  • 8 cents per minute to receive a call, plus VAT
  • 9 cents to send a text message, plus VAT
  • 70 cents per megabyte (MB) to download data or browse the Internet whilst travelling abroad (charged per Kilobyte used), plus VAT.

Downloading data previously cost more than 4 euro per megabyte from many operators in July 2009 – those prices will be cut by around six times.

By 2014, as prices are cut further, the maximum cost of downloading data will be just 20 cents per megabyte, plus VAT, a saving of 90% on many current rates.

Operators are free to offer cheaper rates. Price caps are a maximum level, acting as a safeguard, and competition should drive them lower.

From 2014: competition will deliver cheaper roaming
Enabling customers to the option to shop around for a separate mobile roaming provider will provide an incentive for mobile network operators in countries visited to offer services at rates close to national prices, on the basis of their own low national network costs.

As people's mobile data use intensifies and they want to use their devices anywhere at any time, many travellers are likely to find the wifi-like option very attractive.  These forces will reinforce each other to create lower prices and better network coverage.

Price caps will stay in place until 30 June 2017 as an extra safety net for consumers.

In recent years consumers have benefitted from EU action to create a strong safety net of price caps and guarantees against "bill shocks" and more competition which drives the market to cut prices further.

The latest Commission proposals have moved from draft to implementation in record time of less than one year (see IP/11/835).

Compared to 2007 prices,  the improved EU roaming regulation – taking into account calls, SMS and data - will deliver consumers savings of 75% across a range of mobile roaming services.

This year Europeans will spend around €5 billion on roaming services, a saving of around €15 billion compared to what the same services would have cost under 2007 prices.

For more information
European Commission's roaming website

Annex I
The proposed retail caps serve as a mere safety-net for consumers, while the Commission expects that the proposed competition-enhancing structural measures will deliver new pan-European offers and lower prices, significantly below the safeguard caps

Current and new retail price caps (excluding VAT)

1 July 2012
1 July 2013
1 July 2014
Data (per MB) None 70 cents 45 cents 20 cents
Voice-calls made (per minute) 35 cents 29 cents 24 cents 19 cents
Voice-calls received (per minute) 11 cents 8 cents 7 cents 5 cents
SMS (per SMS) 11 cents 9 cents 8 cents 6 cents

Current and new wholesale price caps excluding VAT (on prices operators charge each other):

1 July 2012
1 July 2013
1 July 2014
Data (per MB) 50 cents 25 cents 15 cents 5 cents
Voice (per minute) 18 cents 14 cents 10 cents 5 cents
SMS (per SMS) 4 cents 3 cents 2 cents 2 cents

Annex II
Data savings

A Belgian family of 4 goes on holiday to France or Italy for a week and uses a smart phone. They can expect to save up to €200.

Summer 2009
Summer 2012
Average price +/- € 5 with VAT
70 cents (+ 21% VAT)

Checks a map 5 times (1 MB per map)
€ 25
€ 4.235
€ 21.50
Checks social media accounts every day for half an hour (+/- 5 MB, € 35)
€ 175
€ 29.645
€ 150. 50
Uploads one photo every day (+/- 2MB per photo)
€ 70
€ 10.20
€ 59.80
Sends one e-mail per day (+/- 20 KB per e-mail)
€ 0.70
€ 0.1185
€ 0.60
€ 270.70
€ 44.1985
€ 226.50

A British businessman/woman goes to France or Germany 10 times for 3 days in one year and uses her smart phone in this way:

Summer 2009
Summer 2012
Average price +/- € 6 with VAT
70 cents with VAT (+ 20% VAT)

Checks 1map per stay (1 MB per map)
€ 180
€ 25.20
€ 159
Checks social media accounts every day for half an hour (+/- 5 MB)
€ 900
€ 126
€ 774
Sends 10 e-mails per day (+/- 100 KB per e-mail/1MB per day)
€ 180
€ 25.20
€ 159
€ 1260
€ 176.40
€ 1083.60

* Currency exchange rates are calculated based on the rates published in the EU Official Journal on 1 June 2012 and will be revised annually.

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