The announcement confirming the abolition of roaming termination fees within the European Union comes as no surprise, but should not necessarily be seen as a wholly negative move for the industry. Instead, this is an opportunity for collaboration and innovation to drive usage and revenues within roaming.
Undoubtedly such a change will have a large impact on network operators throughout the region, however now the decision has been finalised, it is time to take stock and evaluate the new business models and market opportunities which arise from an increase in the number of users of international services.
The opportunity for innovation is immense, with the potential for new tariffs and the launch of MVNOs leveraging a pan-EU roaming proposition. This will further stimulate the use of high quality data services and drive forward adoption of next generation technologies. Utilisation of mobile data roaming services is already rising at a rapid rate and with further consumer price discounts, this is set to continue.
Since the middle of last year, the BICS network has seen a sharp increase in 3G and 4G roaming traffic with operators across the continent reporting rises in usage and a decline in silent roamers. This has been fuelled by a multitude of factors and not price alone. The EU state roaming services are now 91% cheaper than they were in 2007, however, since that time a number of other market forces have come into play. In the years following 2007, domestic mobile data usage has exploded in many markets with heavy 3G network infrastructure investment and LTE network rollout providing a seamless experience for consumers. This has been coupled with developments in device technology and rapid increase of smartphone adoption rates year on year. This has led to a desire from subscribers to remain connected at all times, not just through calls and messaging, but also social media, email and remaining updated with their leisure and business interests.
The hunger for, and reliance on, domestic data services has played a huge role in driving forward roaming innovation, and this will continue as new services such as VoLTE gain market traction. As LTE roaming continues to gain momentum and new players enter the roaming market, the coming years will be a very exciting time to be involved in the industry.
Although the EU’s directive may not have been well received by all parties, it does provide a very real market opportunity for operators to capitalise on the increased usage of cross-border services which is anticipated as a result of negating roaming “bill-shock” fears. Agile and innovative players are in prime position to take full advantage of this industry change, but first they must ensure they collaborate with the right partners to fully embrace the new roaming landscape.
An article by Daniel Kurgan, CEO | BICS, 22nd of July 2015