Teutonic telecommunications troubles

As I've been discovering this week, German prepaid mobile plans leave much to be desired.

In 1999, when I moved from Boston to New York in order to transfer to a different university, there were a lot of logistical hassles along the way. I remember that one of the worst was changing my mobile phone.

Back then in the US, our mobile phone plans still had 'home ranges' outside of which you would pay a roaming surcharge to use your phone. This range was usually your state, or maybe a zone of three states. My mobile phone with a Massachusetts number would have been roaming in New York. So I had to change my phone plan. I also had to change my Massachusetts phone number to a New York one so that when people called me in New York they wouldn't be charged for a long-distance call.

EU internet roaming charges to be slashed

From 1 July this year using a mobile phone to surf the web in another EU country will be about 70% cheaper, following an agreement on rate caps reached today by European Parliament and member state negotiators.

For the first time, the EU roaming caps will limit the rates phone companies can charge you for using the internet in a different EU country. The cost per downloaded megabyte will be capped at 70 cents as of 1 July 2012, 45 cents in 2013 and 20 cents as of 1 July 2014. The current average cost of roaming within the EU is €2.23 per megabyte.

The EU first started limiting the rates EU carriers could charge for roaming within the EU back in 2009, limiting the charge for making calls to 45 cents a minute. That cap has steadily decreased over the past three years, and today's agreement will lower them a further 20% from the current 35 cents to 29 cents, dropping to 19 cents in 2014. Before then, it used to cost an average of €1.50 per minute to make a call elsewhere in the EU. Now, for the first time, internet usage will be capped as well.

Of course this only applies to people with an EU phone carrier. So if you're travelling to Europe from the United States, you'll still pay the high fees.

Is the EU getting too excited over the common phone charger?

Within a year almost any type of data-enabled mobile phone you buy, anywhere in the world, is going to come with one common mobile phone charger – thanks to the EU. This week the 14 main mobile phone companies signed a binding agreement to all use a common Micro-USB charger port standardised by Brussels. And because the EU is the Western world's largest common market, this will mean all data phones worldwide will likely have this standard. Who says the EU doesn't have global influence?

The companies - which include Apple, Nokia, Samsung, Sony, Motorola and Qualcomm – were issued an ultimatum by the EU in 2009: voluntarily adopt a common charging system or be forced to do so by EU legislation. The companies agreed to go with the voluntary root. The common Micro-USB port standards were finalised in December, and the first phones with this port are expected to hit the market within months. According to the agreement, none of these manufacturers can market a new phone in the EU that does not have this common charging port.

I have to admit I've been a bit confused by this policy, and the unrestrained exuberance with which the European Commission has been celebrating it, since it started. After all, isn't Micro-USB the syncing/charging format most smartphones were moving to anyway? Is this just a case of the EU mandating something that was going to happen on its own?

Say hello to the standard EU phone charger

The European Union has reached an agreement with mobile phone makers today to create a standardized phone charger that will work across all models and brands. The agreement was reached after the EU told the phone companies that it did not reach a voluntary accord it would force their hand with legislation. And as the phone companies learned from the roaming rate cap battle, Brussels is willing to put its money where its mouth is when it comes to telecommunications.

Starting next year, new mobile phones will come with the same electrical input socket, mini USB, and they will all come with the same charger (with different prongs for the British Isles and the continent of course). MEPs noted that the new system would make it easier to use someone else’s charger if you’ve forgotten your own, with consumers no longer having to hunt around for a charger that matches the make of their phone.

Commissioner Verheugen demonstrated that difficulty at today's press conference, although perhaps with a bit of exageration!



Of course the main purpose of the change is environmental. Allowing consumers to reuse their old charger with a new phone will cut back on electrical waste

The agreement was reached with Apple, LG, Motorola, Nokia, Samsung, and Sony Ericsson, which together make up 90% of the EU phone market. Since most of these companies also design phones in the US and the rest of the world, I would assume that this standardization will eventually spread to the rest of the world. After all, why would they make phones with different electrical input jacks specifically for Europe?

While this change probably won’t have a huge impact on anyone’s life, it is interesting to note how quickly the companies responded to the EU’s threat of legislation. It’s clear that in the area of consumer rights, companies have learned a lesson from the roaming rate cap debate. From now on when the EU threatens to use legislation for force a consumer rights issue, companies may quickly decide it’s better to each a voluntary agreement than to dig in their heels and resist, only to be forced to change by legislation later on.

The Roaming Battle Rages On

The European Parliament held what in effect will be its last consequential Strasbourg plenary session before June's election today, and there was a lot put on the table. One of today's items up for a vote was a measure to further limit the amount EU mobile phone operators can charge their customers when they are roaming in other EU countries. The parliament passed the measure, and it is well on its way to becoming law.

The parliament had already capped the roaming rates for calls back in 2007, capping rates at 45 euro cents (£0.39) per minute to make a call and (£0.19) per minute to receive a call. Before that some mobile operators were charging as much as £1.50 a minute to make a call while roaming in the EU. This new legislation goes even further and will require mobile operators to lower the roaming cap down to 35 euro cents (£0.30) to make a call within the EU. It would also set a cap on sending a text within the block at 11 euro cents (£.09). Given that T-Mobile now charges me £0.40 per text message I send while roaming in the EU, this is a significant cut. Additionally, the legislation will cap mobile internet data charges to 1 euro per megabite and force companies to round to the nearest second when charging for roaming rather than to the nearest minute. (Interesting sidenote: in Switzerland T-Mobile is still charging me about a pound per minute to use my phone, as they're not part of the EU).

This has been a pet issue of mine for awhile, but a few British MEPs making statements in parliament today got me thinking about the issue in a way I hadn't before. Conservative London MEP Syed Kamall addressed the chamber and made the argument that while this legislation may benefit the people in that room (MEPs, civil servants, journalists, businessmen), it could actually harm the poor, who rarely leave their own country and have no use for lower roaming charges. His fear, he said, was that the mobile operators would have to pass the lost profit from roaming costs on to the domestic customers, "robbing the poor to give to the rich." A teenager living on a council estate in his constiuency, he argued, was going to be charged more money so that an MEP can chat away on his mobile while in France.

While I do have to begrudgingly admit that yes, most Europeans don't use their mobiles for roaming (Kamall cited a figure that said 70 percent of European mobile users don't roam at all in a given year), really his assertion that somehow it is only the rich elite who would have any need for a telephone while in another EU country is rather strange. This is, after all, supposed to be a common market. Should it really be assumed that someone is some kind of monied aristocrat just because they leave their country every once in awhile?

But even beyond the logic of his original assertion, it also seems odd to be so concerned about a company passing on costs it shouldn't have been collecting in the first place. The mobile companies have been making a huge profit off of these roaming charges. According to the European Regulators Group, European mobile operators make up to 20 times more profit on customers when they're roaming as when they are in their home countries. It actually only costs the operator a few cents per minute to connect these calls, and even less if it's the same company (a T-Mobile UK customer roaming with T-Mobile Germany for instance). The high charge of roaming is not to make up for the expensive cost of connecting a customer's call when they're abroad, but rather it's been a cynical way to get loads of cash out of two small groups that won't raise a fuss about it: the occasional holiday traveller who doesn't think about money when he's on vacation, and the frequent international business traveller who probably doesn't even see his phone bill because his company pays for it.

In the end, Kamall's insistence that the MEPs are selfishly voting in legislation that benefits themselves and not Joe Six-Pack back in their constituencies doesn't hold water. It would be a legitimate argument if the rates the mobile operators were charging really reflected what it costs them to connect the call, but that is clearly not the case. They've instead been making a hefty profit off of a vulnerable group that can't complain about it. Even though we international travellers may be few in number, we can't be expected to subsidize everyone else's artificially low rates by being forced to pay exploitative roaming charges.

The new rates are set to take effect 1 July, so just in time for people's summer holidays. As Telecommunications Commissioner Viviane said earlier, "Today's vote marks the definite end of the roaming rip-off in Europe."