European operators have raised the price of roaming calls into the European Union as much as 163% since the introduction of the Eurotariff to compensate for the loss of roaming revenues within Europe.

European regulators have no legislative powers to regulate the cost of roaming outside their own territories, but they say they are well aware of the situation and are considering ways of remedying it.

Informa Telecoms & Media's analysis was based on the percentage change in aggregated roaming prices on a country-by-country basis between 2006 and 2008.

The findings, extracted from a forthcoming Informa Telecoms & Media strategic report, Global Mobile Roaming, Forecasts 2008-2013, were first reported this month in the Global Mobile research service.

For example, the average price of a call home to Italy made by a subscriber roaming in Russia was _3.67* (US$5.74) a minute in 2006 but has risen 25%, to _4.58, since the Eurotariff came into play. A German mobile user outside the EU has seen a massive 163.7% price increase since 2006 for a call home from Africa. Click here to view

The EC's Eurotariff, which came into effect June 30, capped roaming prices at _0.49 a minute for calls made within the EU by subscribers of European mobile operators.

Angela Stainthorpe, author of the report comments that, since the EU roaming regulation came into force in June last year, operators have reported roaming revenue declines into the hundreds of millions of Euros. 

"As roaming traffic growth hasn't kept up with falling tariffs, operators are looking elsewhere to recoup their losses," Stainthorpe says. "Although only 15% of EU roamers are travelling outside the EU, the high per minute rates they pay for the privilege have had a significant impact on roaming strategy. In some cases, countries that were once relatively unimportant to EU operators have now been elevated to prime position purely as a result of their contribution to roaming revenues."

The European Commission says it is concerned about the increase in charges, but that it has no legal instrument to legislate outside the 27 EU member states.

UK regulator Ofcom is working with the European Regulator Group (ERG), which represents the regulators of both EU and non-EU European countries, in "monitoring the situation" regarding the cost of roaming outside the EU. The ERG has collected data about retail and wholesale roaming charges outside the EU in a benchmark report covering 2Q07 and 3Q07, and the next one is set to cover 4Q07 and 1Q08 and to be published in mid-July.

The ERG also plans to advise the EC at its consultation on the functioning and possible extension of the roaming regulation in early July that the rise in rates is possibly due to the Eurotariff.

Informa Telecoms & Media has found that some operators are increasing their retail prices even as they negotiate lower wholesale ones for themselves, and in some cases it seems that in an effort to raise profit margins, larger operators are forcing smaller ones to hand over a bigger chunk of their revenue.

*all prices exclude VAT

ENDS

For more information, please contact Angela Stainthorpe, +44 (0) 0207 017 5807 or Paul Lambert, +44 (0) 0207 017 4268.

About Global Mobile Roaming: 3rd edition

Fully revised and updated Global Mobile Roaming: 3rd edition includes exclusive results of Informa Telecoms and Media's Global Mobile Industry Survey 2008. It addresses some key questions:

*What is the status and potential of prepaid roaming?

*How will voice roaming hubs change the industry?

*What role do Alliances have in roaming?

*What is the size of the roaming market?

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Global Mobile is a leading source of mobile market intelligence and includes exclusive news, competitive intelligence, trend analysis and primary data on the strategies, players and technologies that are shaping the international mobile market.

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