European Telecom Tyrants Tackled Paris, France
August 5, 2007 Lower fees now await all mobile phone users who travel within the EU. As of the end of July mobile phone companies no longer overcharge customers for making and receiving calls between EU countries. Capped Eurotariff roaming fees must now be applied by all telecom firms in the EU, despite howls of protests from the telecom industry, long-fattened on this profit-spinner. The new rules follow a detailed investigation by the EU Commission. This investigation revealed excessive charges and profits of 8.5bn euro ($11bn) annually from roaming fees alone, accounting for up to 15% of the industry's total profits. The mobile phone companies in the EU's 27 member states will introduce new rates, slashing by up to 70% the amount they charge customers for roaming fees. Customers will be given a two-month period to decide if they want to continue with their operator's current rates, otherwise they will automatically be charged the new, lower Eurotariff. A ceiling price of 0.49 euro per minute has been set for outgoing calls, and 0.24 euro per minute for incoming calls when users are outside their operator's national network. The prices are expected to fall to 0.43 euro and 0.19 euro by 2009. Good news for the EU's 479 million mobile phone users, and a big thank you to Viviane Reding, the EU telecoms commissioner, who pushed through these reforms. Her next battle is to lower prices for text messaging.
Best regards, Maria Savage
International Living's European Consultant P.S. If you are following the tale of growth of Telefonica, Spain's biggest telecoms group, you won't be surprised to hear that the company's mobile phone activities have grown more than 15% in the first six months of the year, led by a boom in the Latin America sector. Telefonica has announced a rise in profits from the growth in numbers of broadband customers. Net profits climbed by 66% to 3.83bn euros ($5.2bn) in the first half of the year, boosted by the sale of its Airwave operations (a police radio network used in the UK). Currently in acquisition mode, the company has spent £18bn buying the UK O2 group, 4.1bn euro in a majority stake in Telecom Italia, and made a bid for part of Vivo, Portugal Telecom's Brazilian joint venture.
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