March 08, 2007, 2:45 PM — Europe's mobile phone operators still hope to dissuade lawmakers from passing legislation capping the price for using a mobile phone abroad, even though politicians appear set on introducing the limits.
Speaking after a hearing with members of the European Parliament (MEPs) in Brussels Thursday, GSM Association spokesman David Pringle said it is too early to say that a law imposing caps on both wholesale and retail roaming prices is inevitable.
"Inevitable is a strong word," Pringle said, adding, "We still hope there is a chance to avoid it."
Members of the European Parliament support a move by the Commission to cap prices. National governments remain divided but Germany, which currently holds the rotating presidency of the European Union has proposed capping the price of making a call abroad at 0.50 ($0.60) and the price of receiving a call while abroad at 0.25.
Vodafone Group PLC, one of Europe's largest operators, has said caps at 0.60 and 0.30 respectively, are adequate. Current call prices are commonly well over 1.00 per minute.
The companies attending Thursday's hearing were Vodafone (U.K.), Orange SA (France), Deutsche Telekom AG (Germany), TeliaSonera AB (Finland), E-Plus Mobilfunk GmbH & Co. KG (Germany), KPN Mobile NV (Netherlands), Mobitel (Slovenia) and Meteor (Ireland).
Some MEPs are sympathetic to the concerns of the mobile phone operators. "We should be very hesitant about entering regulation on the retail side," commented Gunnar Hö
kmark, a right-of-center Swedish MEP, adding that "it has always had negative effects on the consumer in the long term."
Werner Langen, a right-of-center German MEP suggested that regulation of retail prices was unnecessary given that prices over the past three years had already dropped considerably.
But most MEPs are adamant that regulation is needed. David Hammerstein Mintz, a Spanish member of the Green Party said it was "clear that autoregulation had failed." "More [of] Europe cannot be synonymous with higher telephony costs for its citizens," he said before describing the profits made by operators at the expense of consumers as "indecent."
Parliamentarians are now discussing whether price caps should be mandatory for all mobile phone users or whether customers should be given a choice between their current tariff and a capped price.
Pringle said that some customers, especially those who make very long calls, could end up paying more through a capped pricing scheme. Tariff plans such as Vodafone's Passport make it progressively cheaper to call abroad the more you use your phone.
"By making customers automatically switch to a capped price scheme, rather than giving them the option to opt in to such a scheme, creates problems for the customer," Pringle said.