A&B Groep Blog | Our Telecom and ICT experiences

Abolition roaming charges in EU does not lead to lower costs

Posted by Jorg Wiedijk on Thu, Jun 15, 2017

The abolition of roaming charges within the EU does not automatically lead to lower calling charges or reduced expenses for companies. Calling abroad has not become cheaper, and is sometimes even more expensive. The costs for out-of-bundle calls have increased, new subscriptions are more expensive and companies are charged higher fees due to complex contracts. Moreover, roaming charges are still applied in other European countries. Calling from Switzerland, for example, has even become more expensive than before.

European telecom providers seek compensation by increasing other costs

This is the conclusion of the telecom consultancy experts of A&B Groep. As of today, people abroad can use their standard bundle to call and use the internet from abroad. Under the title ‘Roam Like at Home’, the EU has put an end to the high fees charged by mobile providers for voice, SMS and internet use abroad, also known as roaming.

The abolition of roaming charges is a step in the right direction, but the telecom expense management consultants of A&B Groep believe that this is not enough. They believe that companies will not be able to save as much in costs as previously thought.

5 examples which clearly illustrate that the new regulations do not by definition lead to lower costs

It was implied in recent months that roaming would be free of charge, but practice proves this to be a false implication. A&B Groep gives five examples which clearly illustrate that the new regulations do not by definition lead to lower costs: 

  1. Out-of-bundle charges drastically increased
    As of today, people in another EU country can use their standard bundle to call and use the internet. The current EU packages - as options in business telecom contracts - are voided by these new regulations. Jorg Wiedijk explains: “The perception that everything is now cheaper will lead to increased usage of data. The use of such data will now also be charged on to the national allowance. The data package limits are therefore reached sooner, as a result of which the out-of-bundle charges will be charged when those limits are exceeded. Those rates have been drastically increased over the past months.” 

  2. Roaming still applies to countries outside the EU
    Besides the various EU countries, there is an entire group of European countries where roaming charges are still applied. Jorg Wiedijk, global marketing director of A&B Groep, gives an example: “We work for a large European customer with subsidiaries throughout Europe. It now appears that the charges for calling from Switzerland to a EU country have even been increased over the past months. The same applies for calls made from a EU country to Switzerland."

  3. Calling other countries is not cheaper
    The abolition of roaming does not mean that calling abroad will be cheaper today then it was before. The charges for calling abroad - for example, from the Netherlands to another EU member state - have not changed. In fact, some providers have even increased their charges for calling abroad.

    As Ron Rijkenberg, CEO of A&B Groep, asks: “Why did the European Commission avoid dealing with this ‘real abolition’ of telecom country boundaries?” He clarifies his question with a practical example: “There is a person in the Netherlands. His colleague in Belgium uses his or her mobile telephone to call that person’s mobile telephone. The call is charged a higher fee than when the Belgian colleague first crosses the border with the Netherlands and then calls from the Netherlands. That roaming call has a lower charge than the international call." 

  4. Existing contracts remain valid
    Companies with existing contracts always receive an adjusted fee plan, as a result of which people will likely have to pay much more. Also, optimisation of telecom contracts is not always possible during the term of the contract. The outside calling fee package charges can therefore lead to an increase of costs.

  5. Obscure calculation methods
    The European telecom markets are obscure and complex. This enables telecom providers to charge higher tariffs, without the companies being able to know whether their contractual agreements are being billed correctly. The analysts of A&B Groep conclude that an average of 11% of all telecom invoices do not tally with the underlying contracts.  They state that the real problem lies in the sheer complexity of the European telecom market.

    Read also our blog:
    "Please note: erroneous invoices, a frequently occurring phenomenon. It also happens to you!"

Complexity of the European and global telecom markets are the real problem

Companies are faced with the complexity of the European and global telecom markets, which makes it very difficult for them to conclude beneficial contracts with telecom providers. For example, an internationally active company is forced to enter into contracts with several providers, even if those providers operate under the same name.

Ron Rijkenberg on this issue: “There are numerous telecom providers. Global providers also operate in separate countries, all of which have their own laws and regulations. Reaching a global deal is therefore nearly impossible. Finding the best possible telecom contract for the entire company is an extremely difficult and complex undertaking. Here at A&B Groep, we intend to use a very fine toothcomb to assess each of our customers' invoices in the months to come.”

Read also our blog:

"Does size really matter? 10 key points and reasons why the EMEA region differs from the US Telecom Expense Management market" 

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Tags: Telecom Expense Management, Telecom, TEM, roaming, EU Roaming, mobile, Roaming Charges