Boon for tourists as EU cuts mobile costs

The European Union (EU) is to vote on proposals to reduce the cost of roaming mobile phone costs - potentially saving tourists thousands of pounds in costs.

Proposals - which would specifically limit the cost of text messages, data and voice calls when sent between rival operators - could become law in July next year if the EU votes in favour.

It is hoped the cost of sending a messages while abroad could fall by around 60 per cent from an average of 23 pence to 9 pence.

The development follows initial curbs in September last year which placed a cap on the maximum charge allowed by mobile phone companies for voice calls.

The moved limited the cost to 34 pence a minute for making a call, and 17 pence for receiving a call while abroad.

Plans - which have been drawn up by EU Commissioner for telecommunications Viviane Reding's - have been sharply criticised by the industry, which has warned the change could mean an end to free handsets and drive up the overall cost of owning a mobile phone.

Ofcom and the British government have also been sceptical, suggesting the plans have no chance of meeting the deadline for implementation and raising fears low-income consumers could suffer as wider tariff rises are implemented to cover costs.

In a submission to the EU, the Department for Business, Enterprise & Regulatory Reform (BERR) and Ofcom said: "We consider such an important change should include a more complete consideration of the impact, including the wider effect of the proposals on the retail prices faced by mobile and fixed-line subscribers."

However, mobile operator 3 has endorsed the plans, claiming phone companies based business models around making money from other providers' customers.

Kevin Russell, 3's chief executive, said: "Your business should be built around the revenues you get from your customers. If MTRs came down, a burden would be removed from 3UK and our pricing would come down as well."

Chris O'Toole