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EU preparing to cap text message prices PDF Print E-mail
Wednesday, 16 July 2008

AFP, BRUSSELS - European mobile phone users could pay less to send cross-border text messages under plans the European Commission is preparing, fed-up that operators have left its calls to cut prices unanswered.

The European Union's executive arm said Tuesday it aimed to bring forward a proposal in October to regulate prices of text message roaming, frustrated that consumers are paying too much.
 
At an average 29 euro cents (46 US cents) per cross-border text message, the price has barely budged since EU Telecoms Commissioner Viviane Reding threatened to impose a price cap at the beginning of the year if operators did not cut rates.
 
The commission is also upset that operators have not lowered prices in the fast growing market for surfing the Internet over mobile phones and is considering action there too.
 
"It is not a good sign for the competitiveness of Europe's mobile industry that it still hasn't got the message that credible price reductions are needed to avoid regulation," Reding said.
 
"There will be a fixed ceiling not a fixed price," she said, adding that after the commission comes out with a formal proposal it will have to be approved by the EU governments and the European Parliament.
 
Europeans send in total 2.5 billion text messages while abroad in Europe every year, at a cost of 10 times the domestic price.
 
Although the average price is 29 cents per text message, the price ranges widely between EU countries with Belgians shelling out as much as 80 euro cents for text messages made while abroad in the 27-nation bloc.
 
The chairman of the European Regulatory Group Daniel Pataki, whose association brings national regulators together, said "a price cap between 11 cent and 15 cent per (text message) would be appropriate."
 
The industry disputes the commission's claims that prices for text messages and Internet services are not falling.
 
According to the GSM Association, the price of cross-border text messages had fallen 18 percent in April over one year while the cost of mobile internet had fallen 25 percent.
 
The industry has warned that the growing price of the regulatory burden it faces is keeping operators from investing in new services. However, Reding dismisses such claims as "blackmail."
 
The commission's action on text messages comes after the commission successfully pushed through a regulation capping the price of making voice calls while abroad in the EU.
 
The commission still has to decide whether to maintain that measure after 2010, but Reding said that the probability was "very high" that she would propose an extension.

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