Europe - regulation roaming charges

EU to decide to cap prices for SMS, mobile Internet

EU regulators plan to say Tuesday if they will push measures to slash the cost of text messaging and mobile Internet outside a user's home country, the European Commission said Friday.

EU Telecoms Commissioner Viviane Reding has accused phone companies of charging too much for data roaming, saying they should reduce prices voluntarily by July 1 or risk a cap on fees like the one the EU imposed last summer on cross-border voice calls.

Costs people pay for mobile phone calls outside their home countries have dropped by up to 60 percent since the European Union executive capped fees in September.

But the price cap does not cover mobile Internet or the 200 billion text messages sent per year in western Europe. Reding said the price of those services needs to fall further to encourage more people to use mobile Internet.

Telefonica's O2 says it has reduced data roaming prices by more than 40 percent since April, Vodafone says it has cut the price per megabyte by 45 percent, and France Telecom's Orange promises it will soon offer cuts of up to 90 percent on standard data roaming prices.

Mobile Internet use has been growing in recent months, phone companies say, but the draw isn't pricing — it's the rollout of social networking sites like Facebook and gadgets like Apple Inc.'s iPhone.

"This industry is very competitive so it's hard to see why the market needs any kind of intervention," said David Pringle, spokesman for operators' GSM Association. "In the data roaming sector, prices came down 40 percent in nine months between the second quarter of 2007 and the first quarter of 2008."

Crossing a border within the EU's 27 nations can hike the costs of sending a text message by up to 25 times, according to the European regulators' report.