Networks rail at EU roaming price cuts

Massive cuts to European roaming charges will take effect this summer but the parliamentary committee responsible for the move has won few friends among UK network operators and industry bodies. />The European Parliaments Industry Research and Energy (ITRE) committee voted on April 12 to cut roaming charges to no more than Â’Â’Â’ 0.40 (27p) per minute for a mobile call made abroad and to no more than Â’Â’Â’ 0.15 (10p) per minute for a call received abroad. The proposed legislation still requires the backing of the European Parliament itself which votes on the cuts in mid-May and a formal EU telecom council in Luxembourg on June 7. />But EU telecoms commissioner Viviane Reding heralded the proposal this month as the last border in the EUs internal market that is bound to disappear very shortly. />She said: These low roaming tariffs should apply automatically to all customers unless they opt for an even cheaper package offered by a mobile operator (opt-out system). />It also means mobile operators will now have to convince consumers they offer an even better package than prescribed by EU roaming rules. This is a strong incentive for competition. />But the GSM Association (GSMA) the global body for network operators said proposed roaming regulation adopted by the ITRE committee could jeopardise the competitiveness of the European mobile market. />Removing incentives />In a statement the GSMA said: If this is approved by the European Parliament the proposed regulation would introduce distortions to the roaming market that will remove incentives for operators to invest and compete which will penalise a large number of mobile users. />The GSMA maintains retail price regulation is inappropriate and unprecedented on the basis of the principles of a market economy which is the foundation of the EC Treaty. The proposed price caps will force operators to offer roaming services at below cost and give them no scope to compete with each other on price and new services. />It said the proposals ran contrary to the findings of the Parliaments own expert consultants Copenhagen Economics which said price caps suggested in the Commissions original proposal would damage competition. />Copenhagen Economics suggested caps be increased significantly Â’Â’Â’ in the case of receiving calls that they be doubled to at least Â’Â’Â’ 0.33 per minute (compared to the original Commission proposals of Â’Â’Â’ 0.17) said the GSMA. />It also argued operators and customers should be allowed to agree on any tariff scheme they wished. />Vodafone also refuted the proposals merit last week branding it price-fixing and fundamentally wrong. />Vodafone fears its Passport package designed for frequent European travellers will have to be shelved under the new legislation. />A spokesperson said: We dont believe its based on a realistic assessment of the situation. There seems to be no explanation given as to why theyve come up with these numbers. This is price fixing in a very old fashioned eastern European kind of way. The unintended consequences wont be beneficial. />The spokesperson said mobile operators were already bringing down prices and the European Parliament didnt understand how mobile phone pricing operated. />Vodafone also took task with the length of time available to explain the tariffs and their effects to customers with the committee proposing the new rates come into action one month after the vote. />Frankly its not enough time for any organisation to inform their customers about major changes. The likelihood of considerable unhappiness occurring is quite high said the Vodafone spokesperson. />O2 echoed Vodafones dissatisfaction with its My Europe offerings also facing the scrap heap. />An O2 spokesman said: It doesnt address the fact consumers dont all travel at the same time they want flexibility and theres a real danger some could be penalised as a result. />We believe from our customer research there is no one size fits all answer at the retail level. That said we support the EUs move to further reduce wholesale tariffs Â’Â’Â’ its something weve been pushing on for some time Â’Â’Â’ but competition and consolidation are driving down retail charges not intervention. />A T-Mobile spokesman said the mobile marketplace was competitive enough to regulate itself. Weve already cut rates to Europe and North America by 50 per cent. We are confident we can continue to bring prices down anyway. It just remains to be seen how the vote will go. />Lone voice of support />Alone in its wholehearted support of the proposals is 3 which said it backed the capping of wholesale mobile roaming charges. />A spokesperson said: We agree and believe these charges are too high. We wanted to see them come down. If you regulate the wholesale rate the customer rate will come down. />The fundamental point is that what the charge is for carrying an international call no longer reflects its true cost. Networks are now more efficient and they are charging too much. />Orange declined to comment until the decision was finalised. />UK telcommunications industry regulator Ofcom which last month moved to slash network termination rates by up to 45 per cent has also failed to throw its weight behind the proposals. It said: We believe some improvements can be made to the detail of the proposals to ensure the right balance between consumer protection as well as providing the basis for continued innovation and competition. />According to Global Insight telecoms analyst Emeka Obiodu public opinion on online forums is already hailing the mobile roaming charge cap as one of the best things to come from the EU with the networks efforts to cut charges being hardly enough. />Obiodu said: The mobile operators may soon realise that in the EUs quest to preach its relevance their businesses concerns are dispensable. />The European Parliament Socialist Group hailed the proposed regulations as an important victory for the consumer and said it would push for even lower rates. />However Informa Telecoms and Media has predicted roaming price levels for non-Europeans travelling in Europe will rise if the proposals are approved. />Several European mobile operators have reportedly told Informa they would increase the wholesale prices that they charge non-European operators whose customers roam on their networks to compensate for the loss of revenues resulting from the proposed price caps. />(See Business Watch left).

Jelly in finals for top award

Jelly MD Gareth Limpenny said: Jellys performance has given us a great deal of satisfaction and continues to drive the company forward.

The Chessington-based B2B division will compete in the marketing category.

Russell replaces Fuller at 3

Kevin Russell has been appointed CEO of 3 UK replacing Bob Fuller who will now retire at the end of June after being with the network for four years. />Russell who has been deputy CEO of 3 UK since January 2007 joined Hutchison in 1995 and was later appointed CFO of Partner Communications Company in 1999. He then became CEO of Hutchison Telecommunications (Australia) in 2001. />Fuller became COO of Orange UK in 1997. He rejoined the Group in September 2001 as co-CEO of H3G Italia Spa and was appointed co-CEO of 3 UK in May 2003.

Vodafone honour Huawei

Huawei provides products and services for handsets and equipment that are used across the across the network. The award was presented as recognition for the companys outstanding performance in those areas.

The ceremony was held at Vodafones Newbury headquarters and Huawei Europe president William Xu was delighted to receive the award. He said:

We are delighted to have been awarded the Outstanding Performance Award by Vodafone. The award recognises Huaweis commitment to providing industry-leading products and solutions rapid response as well as outstanding delivery.

Vodafone global supply chain management director Detlef Schultz said: Huawei received this award for consistently showing a deep understanding of our business needs.

The award also recognises Huaweis determination to help Vodafone achieve its strategic objectives.

Vodafone launches new net bundle

The new Vodafone Mobile Internet Data Pack will cost £7.50 a month and allows users 120MB of data per month the equivalent of viewing 160 web pages.

Customers will be able to view Internet sites on their handsets which are presented in the same format as they are on computers.

Vodafone CEO Nick Read said: Vodafone Mobile Internet will revolutionise the way our customers use the Internet. The service is both easy to use and personalise allowing millions of customers to make the most of their time.

Ofcom launch charges review

Additional charges are placed on customer bills after late payment bounced direct debits and in some cases termination fees are applied. The review will examine whether the charges are set at a fair price or if they should be enforced at all.

Ofcom Chief Executive Ed Richards said: Consumers of communications services see headline prices fall. But they must not be misled. As they make their choice of provider they need confidence that any additional charges are fair transparent and justified.

Sagem Orga sign T-Mobile SIM deal

Sagem Orga Vice President Julien Zuccarelli said: We are very excited about winning this contract. Its common knowledge that T-Mobile has an especially intensive supplier certification process that is designed to ensure a continuous high level of quality for products and services for their own customers.

Free broadband hits Carphone profits

Pre-tax profits dropped to £123.1million as Carphone counted the cost of the £80.5million launch of free broadband.

The launch of the service was hampered as the company struggled to meet demand. Customers were forced to wait for months before being connected leading to a consumer backlash.

The group attributed profit losses to increased admin costs incurred by employing additional staff to deal with the customer service issues surrounding the new service.

Carphone chief executive Charles Dunstone said: Distribution profits are up 22% and in the 12 months since we launched our broadband proposition we have become the number three player in the UK broadband market.

The customer service issues which arose from the unprecedented response to our free broadband offer have now substantially been addressed.

Demand continues to be strong and customer confidence in the service is increasing.

Latest podcast now avaialable

This week Iain Graham and the team debate the pros and cons of regulation review the Nokia 8600 and look at software which keeps data safe and easy to access on your mobile.

Graham said: Regulations are the bane of everyones life. We live in a society where we are regulated to the hilt. In this weeks show we take a look at whether regulation is stifling the industry or if it doesnt go far enough.

The only way to find out the answer is by downloading the podcast now!

To listen to the latest edition of the Mobile News podcast click here.

Vodafone to restructure

Efficient wants the network to release as much as £38 billion to shareholders.

Vodafone share shave underperformed for the sector and shareholders are getting twitchy about low returns from their Vodafone investment.

Efficient Capital wrote to the company asking for four motions to be put to the annual meeting scheduled for July 24.

`Vodafones share price has underperformed the FTSE 100 over the past five years by 28 percent Glenn Cooper Efficient Capitals chairman said in the statement.

“A major reason for this is Vodafones inefficient capital structure. Our resolutions aim to rectify that recognizing the long term quality of earnings of the company.