SMS prices for EU roamers up to 75% higher than in 2006; mobile operators show little appetite to stave off EU regulation

The European Commission seems certain to impose price cuts on SMS roaming following the failure of mobile operators to make voluntary price cuts before the July 1 deadline.

EU Commissioner Vivien Reding warned operators in February that, without these price cuts - and evidence of transparent and credible data roaming tariffs – she would have no choice but to propose more regulatory intervention.

Research by Informa Telecoms & Media shows that, despite a last-minute flurry of tariff changes from the likes of T-Mobile and Telefonica, SMS prices for EU roamers are still up to 75% higher than in 2006. Rates for non-messaging data roaming, however, fell 20% on average over the same period and continue on a downward trend as more operators launch bundled and day-rate packages. The research is contained in a new report, Global Mobile Roaming: Operator Strategies and Market Trends (3rd edition), published this month by Informa Telecoms & Media.

“Considering the impetus behind the voice legislation introduced last year, SMS roaming is without doubt a strong candidate for another round of regulation” comments Angela Stainthorpe, research analyst and author of the report. “Operators have been noticeably willing to bend to the EU’s will regarding non-messaging data, which includes mobile broadband services for laptop users, but have left SMS to the mercy of the regulators.

“We believe that operators have taken the view that it is simply not in their short term financial interest to cut the price of SMS roaming, which already generates sizeable revenues, whereas mobile broadband roaming is still in its infancy and operators need to cut prices to start driving usage,” adds Stainthorpe.

Data roaming will become good business for operators. Revenues from non-voice roaming by EU subscribers travelling in the EU will more than double between 2008 and 2013, reaching €1.1 billion by the end of the period. Although SMS currently accounts for the majority of data roaming revenue in Europe, revenues from non-messaging data roaming will grow on average 26% per year against 7% annual growth in SMS revenues.

For more information, please contact Mark Newman on +44 (0) 0207 017 4263 or at mark.newman@informa.com