Dave Bailey

Pray to the Lords for cheaper roaming

Now that the House of Lords is on the carriers’ case, is cheaper roaming just around the corner?

Written by Dave Bailey

The shenanigans over mobile roaming charges would be hilarious if they weren’t so serious. In the blue corner is EU commissioner Viviane Reding, who is looking to land a knock-out blow against the ridiculously high fees users have to pay for the privilege of making and receiving calls when abroad. And in the red corner (Boo! Hiss!) are the mobile operators, who would rather like to keep milking this particular cash cow.

For the background to this dispute, cast your minds back to the 3G radio spectrum auction of March 2000. The seven-week bidding process raised a staggering £22.5bn for the Treasury. Gordon Brown must have been as pleased as Punch, but the mobile operators weren’t laughing.

Was it the government’s fault that the amount of wonga raised was so high? Hardly, since they weren’t the ones doing the bidding. Anyhow, having paid through their collective noses for their 3G licences, the operators have struggled to fund their 3G rollouts.

Progress on this front has been so sluggish as a result that most 3G customers are still only getting 1.8Mbit/s download and 384kbit/s upload speeds, which is way below what is possible. Indeed, back in early 2006 I saw a trial service on Vodafone’s network giving well over 5Mbit/s. It could be argued that if it wasn’t for the money operators make from roaming, 3G development would be even slower.

But is it really the case that the mobile operators have been forced into levying exorbitant roaming charges by Brown’s auction wheeze, or are they doing it simply because they can? Let’s face it, it wasn’t our elected leaders who decided to start hitting the mobile operators with a big stick, it was the EC in the shape of Reding.

Westminster was eventually stirred into action, however. On the back of Reding’s push to cut roaming charges, a House of Lords committee was recently set up to investigate whether roaming fees should be capped. Judging from their interim findings, the Lords are looking to cap the wholesale charge rather than the retail charge, in the hope that the mobile operators will pass on the savings to customers.

Of course the problem is, even if the EC manages to drive down roaming charges, operators will try to recoup the loss somewhere else. The Lords are awake to this danger. In their interim report, they ask: “Do you think that the pressure for lower roaming charges could potentially spill-over into higher prices for other mobile telephony services?”

Meanwhile, it has emerged that while the EC would like to cut charges by 70 percent across the board, a plan has been floated in the EU parliament for the reduced fees to only apply to new customers. It seems the powers-that-be are happy to keep fiddling while roamers are burnt.

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