Messaging roaming price cuts imminent

Failure to heed EU Commissioner's warning operators that price cust woudl follock lack of credible data roaming tariffs

Communications analyst Informa Telecoms & Media believes that the failure of mobile operators to make voluntary price cuts on SMS roaming before the July 1 deadline will lead the European Commission to impose charge reductions/

In February this year, EU Commissioner Vivien Reding warned operators that without the evidence of transparent and credible data roaming tariffs from operators she would have no choice but to propose more regulatory intervention.

Informa’s research, contained in a new report entitled ‘Global Mobile Roaming: Operator Strategies and Market Trends (3rd edition)’  shows that, despite a last-minute flurry of tariff changes from the likes of T-Mobile and Telefonica, SMS prices for EU roamers are still up to three-quarters higher than in 2006.

Rates for non-messaging data roaming, however, fell 20% on average over the same period and continue on a downward trend as more operators launch bundled and day-rate packages.

“Considering the impetus behind the voice legislation introduced last year, SMS roaming is without doubt a strong candidate for another round of regulation” commented Angela Stainthorpe, research analyst and author of the report. “Operators have been noticeably willing to bend to the EU’s will regarding non-messaging data, which includes mobile broadband services for laptop users, but have left SMS to the mercy of the regulators.

“We believe that operators have taken the view that it is simply not in their short term financial interest to cut the price of SMS roaming, which already generates sizeable revenues, whereas mobile broadband roaming is still in its infancy and operators need to cut prices to start driving usage,” added Stainthorpe.

Informa speculated that data roaming will become good business for operators with revenues from non-voice roaming by EU subscribers travelling in the EU more than doubling between 2008 and 2013, reaching €1.1 billion by the end of the period.  Although SMS currently accounts for the majority of data roaming revenue in Europe , Informa predicts revenues from non-messaging data roaming to grow on average 26% per year against 7% annual growth in SMS revenues. 

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