EU roaming price-caps to hike costs for visitors?

Visitors to Europe may find they have to pay increased roaming charges as a result of price caps being imposed on calls within the EU.

According to analysts at Informa, a number of European mobile operators say they will increase the wholesale prices they charge non-European operators whose customers roam onto their networks, to "compensate for the loss of revenues resulting from the new European price caps".

The European parliament is currently rubber-stamping controls on the amount European operators charge each other for connecting a call. The reforms have been led by Viviane Reding, the European commissioner for information society and media, and are aimed at creating a simplified single market for people who travel between EU countries.

Mark Newman, an Informa analyst, said: "What we are beginning to see here is the emergence of a two-tier market for roaming services. With the new price caps and the emergence of pan-European groups, such as Vodafone, Telefónica O2 and Orange, Europe is going to start resembling a single market in terms of retail prices. When people want to use their phones outside of their countries or regional groupings, they will pay a substantial premium."

Newman pointed to the example in India, where domestic operators charge foreign operators 30 times the wholesale rate they charge other local carriers. He said European operators may demand a reduction in these fees, or may retaliate with a punishing reciprocal arrangement if cuts are not forthcoming.

David Meyer writes for ZDNet UK