Sven Mesecke's blog

Posted Do 03 April 2014

Removing EU roaming charges is a big deal

Update January 2017

The European commission came to similar conclusions as those below - and limited the effects of its end-of-roaming-initiative to disallow a real competition between carriers from different European countries. Unfortunately, we will still suffer from limited competitions and widely varying offerings within the single market.


In April 2014, the European Parliament adopted a notion to ban all roaming charges in the EU. Also, net-neutrality. But the ban on roaming charges could be much more disruptive for the EU Telecoms market than you would expect. It is obviously great if the Swedish tourist heading to Spain on summer holidays can continue using Facebook/Twitter/WhatsApp and so on without any additional charges. It is great for the business traveller to not worry about exorbitant charges when using his 3G iPad in a foreign country. But most importantly, it opens up every EU country to every EU mobile carrier. An Austrian carrier could compete with German carriers on the German carrier's home turf. I could search all EU countries for the best phone and data deal and use it without penalty in Germany. With the ubiquity of credit cards and the introduction of SEPA (the EU wide banking system), even billing would not pose an issue.

One issue remains, though. A French carrier without a German subsidiary needs to agree on charges when a customer uses the German carrier's network. Depending on those charges, accepting German customers could easily become economically infeasible for the French carrier. A similar situation existed in the 90s in Germany when the Telecoms market was liberated: Upstarts (such as O2, known as Viag Interkom in the beginning) could not cover the whole country, so they needed to use one of the major carriers (in this case the Deutsche Telekom) for the non-covered parts of the map. However, the regulator actually set maximum rates on these roaming charges so that a healthy competition could be ensured. I could not find any information on whether a EU regulation of carrier-carrier roaming charges is planned as well.

So what to expect?

Short term this will probably immensely benefit EU customers, not only travellers, but everyone. Obviously, in the very long run a highly consolidated EU Telecoms market could be as anticompetitive as the US market.

Update: Someone on Hackernews argued that international charges would still apply. However, according to this:

International call charges would be capped at the price of a long-distance domestic call and intra-EU mobile calls at €0.19 per minute (plus VAT).

there would be no difference between domestic and (EU-)international, eventually creating the coveted single market. From Ryan Heath, spokesman of Neelie Kroes:

Sven @1sveme

@RyanHeathEU would the new roaming rule mean that a truly single market would be created? Could an Austrian company compete in Germany?

Ryan Heath @RyanHeathEU

@1sveme yes. You could buy your mobile subscription from another EU country and a company could easily set up in another country

Category: Society
Tags: EU Mobile Telecoms