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Roaming Charges: The good, the bad and the Brexit

Roaming Charges: The good, the bad and the Brexit
1
Jun

After years of negotiations between the European Commission and telecoms companies, further caps on mobile roaming charges for EU states have recently been introduced, and in the summer of 2017 these charges will be fully abolished. For consumers and businesses, who are increasingly demanding greater connectivity, this seems undoubtedly like good news. Gone will be the days of dreading the post trip phone bill, or spending holidays darting from one Wi-Fi hotspot to another. However, this new ability for consumers to “roam like home” may come with some deeper consequences, such as the potential restructuring of the European mobile market.

These caps have the possibility to significantly impact mobile operators’ profit margins. A previous combination of a heavily populated market, and a large profit margin from providing roaming services has been extremely lucrative. In order to make up these lost costs, operators may push up their prices across their networks. However, this loss in profit margin may be countered by the predicted rise in the usage of mobile phones across the continent. Currently, consumers limit their roaming use due to high costs, however reducing roaming costs will increase the volume of data usage. This increased use could lead to operators’ profits remaining more or less unchanged, however it may also require an increase in network infrastructure to cope with the increased demand.

It is not certain in the case of a “Brexit” whether roaming charges would remain implemented in the UK. Three non EU countries: Norway, Iceland and Liechtenstein signed up to the European Commission agreements to abolish roaming charges. However, unless specific action is taken, EU regulations, including those surrounding roaming charges, would not apply to a post-EU Britain, in the same way that roaming charges will still apply in Switzerland after next summer.

The removal of roaming charges could also highlight the large variation in prices of SIMs and tariffs across Europe. Without the introduction of regulations, there will be the possibility of buying and reselling SIMs and tariffs from lower cost countries. Customers could then use in their home countries as “roaming” devices on a far cheaper tariff. The introduction of such regulation, as well as the shifting tariffs and usage across the continent, and the move towards a European single market will lead to operators reviewing and adapting their service, which ultimately will have an effect on European consumers and business.

For more information on how the changes to roaming will effect your business contact StableLogic for a free consultation.