International Mobile Roaming – An Update

Abstract

Governments in a number of countries are concerned about the high surcharges for international mobile roaming and instances of “bill shock”. Russia has used competition law to force down excessive prices. Singapore has introduced consumer protection against bill shock. The USA has consulted extensively on measures to address bill shock. The governments of Australia and New Zealand have held bilateral discussions.

The European Commission is preparing its final report on the Roaming Regulation, due in June 2011. It has held a consultation in which the consensus was in favour of a further regulation from 2012 to 2015, continuing price caps, with a further review in 2014. There has not been the anticipated increase in usage, with customers not having changed their behaviour.

While operators want to end the regulation, the alternatives seem to be ineffective or counter-productive. The precise levels are uncertain as is the possibility of a retail cap for data roaming.

A number of niche services are available to bypass conventional roaming but have had no effect on the behaviour of conventional mobile operators.

At a wholesale level there has been a growth in the use of hubs, which allow operators access to large numbers of foreign networks for outbound roaming at undiscounted prices, but with options to negotiate prices and inbound roaming. As yet, these do not seem to have increased competition or reduced prices.

Discussions continue in international and inter-governmental bodies including: APEC, Arab League, ASEAN, CITEL, GCC, ITU and OECD. Yet, there remain significant challenges in finding a workable legal basis outside that of the European Union treaties, not least in complying with existing commitments to the World Trade Organisation (WTO).

Revised from the version of March 2011.

Keywords: Roaming, Telecommunications, Wireless, Competition, Policy

JEL Classification: K21, K23, L96