Today, the European Parliament plenary ratified the political agreement to abolish retail roaming charges by June 2017. MVNO Europe, representing innovative virtual mobile operators in Europe, welcomes this vote but will remain very attentive to the revision of the wholesale market included in the text, as we believe is a pre-condition to an effective roaming-free Europe.
After more than two years of intense negotiations, the EU institutions finally agreed to the end of retail mobile roaming surcharges in the European Union by 15 June 2017. Until this date, a transitional regime will be put in place on the 30th of April 2016 allowing operators to apply a surcharge capped at €0.05 per minute, €0.02 per SMS and data use at €0.05 per megabyte.
However, the battle isn’t over yet. The foreseen end of roaming is dependent on the completion of a review, by the European Commission, of the regulated wholesale roaming market (the price operators pay each other to use their respective networks). Without any further reduction of wholesale regulated roaming prices, in particular for data, MVNOs – but also smaller MNO operators – will have to pay overpriced wholesale roaming charges to visited mobile operators in order to offer roaming services to their consumers in Europe, thus making it impossible for them to remain competitive on their domestic markets. Due to a structural absence of bargaining power, MVNOs are usually required to pay maximum rates when striking deals with MNOs on providing roaming access to their customers. Yet, smaller and more agile players such as MVNOs have been always more competitive in terms of prices as well as first-movers in innovative offers to European consumers (e.g.: multi-numbers SIMs, niche markets or fixed/mobile integrated offers, IoT/M2M, sophisticated m-payment solutions based on NFC, multiple sourcing strategies).
In the absence of a significant reduction of wholesale caps reflecting genuine costs of international roaming, mobile operators will be induced or even forced to impose restrictions, also through complex and unfriendly contractual clauses, to end-users when roaming abroad. This will be an unexpected and disappointing outcome of the present regulation, which would undermine the credibility of the efforts carried out by institutions and industry up to now.
Jacques Bonifay, Chair of MVNO Europe said that “MVNOs are crucial for competition and innovation, adding real value on the telecoms market and to end-users. With excessive wholesale roaming charges, dominant mobile operators will be the only one to drive the market, pushing MVNOs out.” and added “reducing wholesale caps is a simple measure that works” at the last BEREC stakeholders forum held in Brussels on October 15th.
The European Commission, with the support of BEREC, is to conduct this review by June 2016, which will still need to be agreed on by all parties. Negotiations could take more time than expected and postpone the real end of roaming. Additionally, during the transitional period, MVNOs risk margin squeeze and therefore urge for the review to be done as soon as possible. MVNO Europe will remain vigilant in this process in order to make sure that the revision will not distort the market in favour of the largest mobile operators and lead to the exclusion of dynamic smaller players.
MVNO Europe was created in 2012 to represent the interests of Mobile Virtual Network Operators (MVNOs) which are active on European mobile markets, and have negotiated wholesale access to the networks of host Mobile Network Operators (MNOs). The goal of MVNO Europe is to create a more openly accessible market for all MVNOs, in order to contribute to the growth of the fast-moving mobile industry. MVNO Europe represents companies such as Cyta Hellas (Greece), EI Telecom (NRJ Mobile – France), Liberty Global (incl. ao. VirginMedia UK), PosteMobile (Italy), Telenet (Belgium), Transatel (multiple EU and non-EU countries), and Voiceworks (Netherlands and Germany).
Morgane Taylor, firstname.lastname@example.org