Six European networks with 200m customers between them have agreed to halve the price of average wholesale roaming tariffs.
The group – T-Mobile, Orange, Telecom Italia, Wind (also Italian), Telenor and TeliaSonera (both Scandinavian) – will cap the average wholesale roaming rates they offer each other at €0.45 per minute from October 2006 and €0.36 from October 2007. That should result in a big drop in the retail price of roaming services within the EU area, probably by around 50%.
An independent body will be appointed to audit the reductions in the average retail price of roaming voice services among this group of operators.
The group is also offering to apply the cap on a reciprocal basis through agreements with other operators both in and outside Europe.
This scheme appears to have headed off the European Commission’s proposals for caps on retail prices. The operators say their approach still provides scope for competition on prices and services between mobile operators at both the wholesale and the retail level.
But there’s a potential downside: the move, essentially driven by trade body the GSM Association, may backfire if the Commission regards it as price fixing. This certainly kept out O2, which had been approached to join the group. Vodafone apparently had also been invited but decided instead on a unilateral wholesale price reduction back in May, a wholesale rate of “no more than” €0.45 a minute to any operator in the 25 EU states.
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