Tech Talk: British Carriers Likely To Raise Euro Roaming

There are four mobile networks, or carriers, operating in the United Kingdom at this time. This includes Vodafone (a British company), O2 (currently owned by the Spanish Telefonica), EE (owned by BT, a British company) and Three (headquartered in Hong Kong). However, these four networks must conduct their business under both the European Union and British frameworks and law. In the case of roaming costs across the European Union, this is good news: currently, these four British networks must cap roaming costs at no more than €0.05 a minute, text messages at no more than €0.02, and data no more than €0.05 per megabyte. Unfortunately, at the time of writing the pound sterling and Euro exchange rate is too volatile to put these into sterling terms. These costs are set to be abolished by this time next year, in June 2017, and the end of roaming rates is going to be a significant advantage to businesses wishing to operate within the expanse of the European Union. In the United States of America, roaming agreements enabled businesses to use cellular networks as a viable business tool when traveling and it is likely the same thing will happen in Europe. It will also open up competition between the carriers and ultimately results in a better deal for the customer.

However, with more British voters deciding on leaving the EU than wanting to stay put, this means that the European Union roaming deal could be scrapped as soon as the United Kingdom leaves the union, which is probably two years from now. British consumers could benefit from no roaming rates from next summer and then find them reintroduced when the split is finalized. There are at least 350 high priority issues that must be resolved between now and the United Kingdom leaving the European Union and the abolition of roaming rates is not on this list. It's no surprise that none of the UK's carriers are prepared to comment about roaming rates as this sits low down in their list of priorities. In the case of Telefonica's O2, the business will likely be more concerned about trade agreements and tax rules, not to mention that its sale of the O2 business was recently blocked. Curiously enough, this merger was blocked by the EU; perhaps these companies will try again under the new regime?

Is "Brexit" likely to cause roaming rates to rise for British customers? It is likely, as mobile carriers have massive investment to make and keep up, but are facing massive cost pressure. We may see an industry rate rise a few weeks or months after the UK leaves the European Union. However, it is also possible that the British and European carriers are unable or unwilling to make competitive deals, and roaming rates skyrocket, and British customers are told that because they left the European Union, so these countries are now considered "rest of world" for international roaming. To put things into perspective, on the British Vodafone network, for many consumer pay monthly contracts, customers pay £1.35 per minute to make a call and £1.00 a minute to receive a call. Again, the pound sterling to US dollar exchange rate is volatile at the moment but this converts to something like $1.90 a minute to make a call at an exchange rate of $1.40. Visitors from the European Union countries into the United Kingdom could also see massive hikes in roaming rates. However, it is also possible that the British carriers will be able negotiate more reasonable terms with their neighbors and British customers could see more moderate roaming rates. The four UK carriers operate in a fiercely competitive market, but we have seen the price per minute of calling increase almost in uniform across these businesses.

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About the Author

David Steele

Senior Staff Writer
I grew up with 8-bit computers and moved into PDAs in my professional life, using a number of devices from early Windows CE clamshells and later. Today, my main devices are a Nexus 5X, a Sony Xperia Z Tablet and a coffee cup.