Roam like at home… but at what cost?

With consumers all over the European Union cheering the abolishment of roaming tariffs, critics have emerged warning mobile phone users to look out for new or additional fees that operators might introduce to make up for revenue losses.

The Roam Like At Home (RLAH) legislation has been in the offing for over a decade, finally coming into force this month as Malta was holding the Presidency of the Council of the European Union.

In theory, the RLAH means that EU citizens roaming in EU countries will be charged domestic rates.

But whilst EU leaders moved quickly to herald the coming into force of the new rules as “a true European success story”, tech experts warned consumers to remain on the look-out for loopholes.

One such loophole enables operators to charge extra fees – which according to Business Insider is applicable in Sweden. The loophole would be triggered if the roaming policy results in heavy losses for telecommunications companies.

Operators have been given the opportunity to make use of the Fair Use Policy, which allows service providers to charge the user to prevent abusive and anomalous usage in a EU country – such as the use of roaming services other than for periodic travel.

According to the Malta Communications Authority, service providers may decide not to apply RLAH whilst roaming in any EU countries, in cases where the user does not have proof of a normal residence or stable links supporting the frequent and substantial presences. By way of example, if abroad for more than four months of the year, the user will need to prove why. It could be a document that proves one is studying or working abroad.

EU citizens are mostly concerned about new charges that operators might introduce to offset the losses. Tech experts warned that operators could increase charges on international calls or roaming charges to non-EU countries.

Additionally, the European Commission confirmed that 36 telecoms operators – out of thousands – applied for exemptions to the rules.

Malta’s three major service providers – Vodafone, GO and Melita – were reluctant to state how much they estimated the losses, from the removal of the roaming charges, to be.

A spokesperson for Vodafone Malta said that the operator anticipated that some of the losses would be recouped through increased usage by customers whilst roaming.

For the financial year 2016/17, the impact on the revenues of Vodafone Group – not just on Vodafone Malta – as a result of the roaming charges was that of €150 million. Vodafone Group expects the impact to be around €300 million for the financial year 2017/18.

Asked how Vodafone planned on offsetting the losses, the spokesperson confirmed that Vodafone Malta was not planning an increase, as a direct result of the RLAH regulation.

“The pricing of mobile services is highly dynamic and we are always seeking to meet our customers’ demands in a very competitive market. No, Vodafone Malta is not envisaging an increase in prices as a direct consequence of the roaming regulation. Vodafone Malta even goes a step further – customers on certain plans may now use the minutes in their bundles to make international calls from Malta to any other EU country at no extra cost.”

In replying to questions by MaltaToday, GO avoided stating how it planned to offset the losses, but stressed that the RLAH was a development it had prepared for.

“For a number of years, the Commission has been working to reduce, and ultimately end, the charges incurred by customers using their mobile devices when crossing borders. This is therefore a development GO has long been aware of and, indeed, all of GO’s customers have been benefiting from the reduced EU roaming rates as from 1 June 2017,” a spokesperson for the company said.

“With the new ‘Roam Like at Home’ rates, customers now have more peace of mind when using their mobile devices anywhere in the EU. This improved customer experience will give rise to more prolific use of data and voice whilst abroad.”

One of the points that the operators had raised with the European Commission during the negotiation process of the legislation was the fee that operators charged each other when customers use foreign networks while travelling: if consumers were no longer to be charged for roaming, should operators charge each other less?

This is an issue that Melita raised in its replies to MaltaToday, when admitting that it was not in a position to estimate the loss that will be incurred as a result of the new regulation.

“All will depend on how much our customers will actually use roaming services in the future. Due to the new regulation, Melita will then have to pay foreign operators for the use of their network but we will not charge these costs back to the customers anymore,” Melita said.

“As stated, Melita’s plan is always to provide better options and more value to customers. In line with our new, refreshed branding, we have one objective: to listen to our customers and serve them in the best way we can.”

Melita flatly denied it plans to increase roaming tariffs and other charges for non-EU countries.