Development of roaming services

Published 16.10.2015

International roaming refers to the use of a domestic mobile subscription abroad. Roaming prices are regulated in the EU and as a result, prices have been set at a lower level several times. The ultimate objective of regulations and price decreases is to form an internal EU market where consumers are able to use mobile services in the same ways and at the same prices as they would in their own country. Lower prices have been reflected in the use of services, and Finnish people are increasingly using roaming services in Europe and in other countries. In particular, the use of data services has increased.

Towards more affordable roaming

The prices of roaming services have been reduced through maximum prices defined in EU regulations. As a result of the maximum prices, the prices of roaming services within the EU have dropped in stages since 2012. The regulation on roaming prices does not cover calls placed (international calls) or text messages sent from the home country to another country.

In addition to the regulated maximum prices, telecommunications companies may provide their customers with roaming services at prices deviating from the maximum prices if the customer so chooses. According to information collected by FICORA, Finnish people are using both options: services subject to maximum prices and roaming services priced otherwise.

During the summer of 2015, the EU Council, Commission and the European Parliament reached an agreement on amending the regulation on roaming prices. Under the new regulation, roaming services could be used in Europe at domestic prices when travelling infrequently, starting from the summer of 2017. In order for the new regulation to enter into force, wholesale regulation on roaming needs to be amended. In addition to the wholesale regulation, other future regulatory details need to be settled before the beginning of 2016.

Roaming prices are not regulated outside the EU; instead, the prices are based on market conditions. As a result, there are significant differences in mobile prices between different telecom companies and destinations when travelling outside the EU.

The use of data services is also increasing when travelling abroad

The most significant change in the use of roaming services after 2012 concerns the use of data services. During the first quarter of 2015, the use of data services by Finnish people when travelling abroad more than doubled from the corresponding period in 2014, and increased more than eightfold from the first quarter of 2013. The growth has been steady and has mostly taken place in the EU. Finnish people mainly use data services in Europe.

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Figure: Data transfer volumes in Finnish subscriptions in the EU and in other countries in 2013–2015

Furthermore, the total number of call minutes placed abroad has increased. The number of call minutes has remained fairly stable outside the EU, whereas it increased by 25 per cent within the EU during the period under review. Instead, there is variation is the number of text messages sent abroad and, by the end of the review period, the number has decreased both in the EU and in other countries.

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Figure: Call minutes from Finnish subscriptions in the EU and in other countries in 2013–2015

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Figure: Text messages sent from Finnish subscriptions in the EU and in other countries in 2013–2015

The significant difference in the use of roaming between the EU and other countries is mainly caused by the EU regulation on prices. In other countries, roaming prices show significant differences from one country to another. In some countries outside the EU regulation, roaming prices may be extremely high.

Room for growth in the future

Figures associated with roaming services are still low compared with the use of mobile services in Finland.

At the end of 2014, the duration of calls placed abroad accounted for less than 1 per cent of the total call minutes of all Finnish mobile subscriptions. Text messages sent abroad hold a significantly larger share, accounting for more than 2 per cent of all text messages sent from Finnish subscriptions. Even though the number of text messages sent abroad has turned to a decline, their share from all sent messages has increased by 20 per cent. In Finland, the number of sent text messages is falling more rapidly than the number of messages sent abroad. As the share of calls placed abroad from total call minutes has increased by 33 per cent in two years, calls placed abroad are showing an opposite trend compared with calls placed in Finland.

Even though the use of mobile data when travelling abroad has increased significantly in recent years, it only accounts for 0.2 per cent of all mobile data. At the beginning of 2013, roaming services made up 0.1 per cent of all data. Therefore, the volume of data used abroad is increasing even faster than that of data used in Finland.

It is likely that the use of roaming services increases as roaming prices fall closer to domestic prices and, as a result, the gap between roaming and domestic services may become even narrower.

This article is a part of FICORA's Communications Sector Review 3/2015.

Key words: Internet , Telephone , Mobile phone , Roaming , Reviews , Statistics

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