Thursday, March 30, 2006

Ovum: EU discloses plans for regulation on international roaming

Stefano Nicoletti at Ovum chimes in on the recent proposal from the European Union to regulate roaming. He writes that "International roaming regulation has been a long-running saga. It has been discussed by regulators for many years, but no concrete actions have yet been enforced, meaning that we are still paying hefty charges when travelling abroad." Nicoletti provides some historical background and then opines:

Retail charge controls are out of the scope of the current EU regulatory framework directives, and are a very intrusive way of regulating. To our knowledge, mobile retail rates are not regulated anywhere in the world, with the exception of Korea, which is traditionally a strongly regulated economy. Therefore, if they are going to be introduced, we believe they should be used as a temporary measure and withdrawn once the market shows more competitive behaviour. In the end, the best way to serve EU citizens is to make sure that market forces work effectively, rather then imposing intrusive regulation.

It's a heavy-handed regulatory approach overall, which reflects the fact that the EU will not delay its intervention any longer. The timescale has also been tightened: a short consultation period until April and an approval process in June. The regulation will have to be approved by the Parliament and the Council of Ministers to become immediately effective. However, there could be some slack in the implementation at national level.
He concludes:
We expect the industry to react strongly and challenge this decision, which could take away pretty much all their roaming revenues, but it now seems that everything has been decided, so it might be too late!