WIK-Consult conducted a study on behalf of the European Commission. The study’s terms of reference asked us to assess: (1) how the European mobile roaming environment for voice, SMS and data evolved since the first Roaming Regulation was enacted in 2007; (2) whether regulation of mobile roaming would still be necessary when the amended Roaming Regulation expires in 2012; and (3) the potential effectiveness of a range of potential alternatives to the current regulation.
We found that deeply entrenched market challenges, both at wholesale and at retail level, are likely to lead to high prices in the absence of regulation. European regulation to date has largely corrected the prices, but the root causes remain. We explored a large number of structural solutions, none of which are likely to be highly effective. Changing the regulated Eurotariff from opt out to opt in might have a small net positive effect. In the longer term, if prices are forced to sufficiently low levels, demand elasticity would likely increase and might become sufficient to initiate a self-sustaining competitive dynamic.
The study is available for download.
