Europe's phone users stand to save €2bn over the next three
years following today's publication of the European Commission's
guidance on termination rates.
The EC wants national regulators to use a marginal cost-based
method to limit the wholesale fees charged by network operators to
connect a call received from another operator's network. These fees
are hidden in everyone's phone bill.
Mobile termination rates are up to 10 times higher than fixed
rates, the commission said. They vary from €0.02 per minute in
Cyprus to €0.15 per minute in Bulgaria, with an average of €0.855
per minute.
Higher mobile termination rates make it harder for fixed and
small mobile operators to compete with large mobile operators, the
commission said.
These divergences, and differing regulatory approaches,
undermine the single market and Europe's competitiveness, it said.
Eliminating price distortions between phone operators across the EU
will lower consumer prices for voice calls within and between
member states, saving business and household customers at least
€2bn between 2009 and 2012. It could also encourage new investment,
it added.
The strongly-worded recommendation says specifically that
national termination rates should be based purely on the real costs
that an efficient operator incurs to establish the connection.