By Dennis Jones
June 15 promises to be a big day in the European Union. After years of preparation, the EU is set to officially launch its Roam Like Home initiative. Just to jog your memory: Roam Like Home, or RLH, is the framework in which the EU will seek to completely eliminate retail roaming charges for its consumers, so that those travelers avoid notorious “bill shock” events when visiting other EU member states. As the name suggests, RLH means that consumers can expect to pay the same for mobile connectivity when they are travelling in other EU countries as they do when they are in their home country. Long hailed as a major regulatory victory, especially for European consumers and mobile enterprises, RLH promises to bring significant relief to those constituencies. In fact, European Commission-led regulations in the telecom space, culminating in RLH, have been seen as largely contributory to ARPU decline in the Union. But now that RLH is coming into full effect. Some industry analysts remain skeptical that consumers will experience the relief they’ve been promised.
Here is why:
- The possibility of more expensive plans and more obscure surcharges. Concern that as a result of RLH, mobile operators will pass on the loss of roaming revenues to their subscribers is not new. And although we’ve seen a generalized trend towards lower ARPU in the EU, it’s been countervailed by the emergence of pricier postpaid plans, offering bigger data bundles. Some of these plans have already run afoul of regulators. Moreover, mobile operators might introduce a host of obscure fees and charges to make up for lost roaming revenues.
- Fair-use caps on roaming. So operators don’t lose their collective shirts, RLH allows operators to limit their subscribers’ roaming data use over certain data volumes. Those limits tend to vary from operator to operator, which can be confusing for consumers. We’ve seen geographical cleavage in the EU, between northern member-states, where local consumers are more likely to be outbound roamers, and southern member-states, where local operators are more likely to be recipients of incoming roaming activity. There’s also a similar cleavage between large mobile operators and smaller MVNOs, who risk bearing a financial brunt, re: the price they pay for wholesale roaming costs.
- Operator opt outs. RLH also provides potential opt outs for operators who can prove to their national regulator (the actual enforcement muscle behind RLH) that RLH creates a financial burden.