Leading article: A European Union call to arms

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The Independent Online

Fresh from its success in forcing mobile phone companies to stop ripping off customers who make calls abroad, the European Commission has turned its attention to the texting and internet access swindle operated by these same firms.

It is a well chosen battle. A text sent from a mobile phone while abroad costs around 21p, compared with 5.6p in Britain.

And downloading one megabyte of information can set a user back £4.11 on the Continent, as opposed to £1.50 in the UK.

There is no evidence that these extra charges are at all related to the cost of delivering the service. It looks very much like the predatory targeting of those who use their mobile phones abroad. The phone operators make more than £5bn a year globally from such "roaming" charges, accounting for more than 10 per cent of total sales. Operators also make up to 20 times more profit on roaming customers than on domestic ones. It is small wonder that they want to keep this income stream intact. But the EU telecoms commissioner, Viviane Reding, called time on the scam at the GSM Mobile World Conference in Barcelona yesterday.

Ms Reding outlined a clear choice for the industry: cut the costs of texting and internet access to those using their handsets in other EU countries by 1 July, or face price caps from Brussels.

Operators continue to argue that the price of these services is determined by competition between various providers. But the big players such as O2 and Vodafone have already begun to cut costs in the UK, undermining their own defence. T-Mobile is expected to announce price cuts this week.

Will regulation be required? That is up to the industry. Europe's phone operators are supposedly attempting to co-ordinate an industry-wide reduction in the rates they charge for providing data and text services to the users of rival networks.

But the industry attempted something similar over voice roaming on different networks two years ago. The Commission ruled that it had not done enough to bring down prices and introduced retail price regulation.

The EU has come in for much criticism of late for busying itself with institutional, rather than economic, reform. But this is an excellent example of Europe putting economics first. There are more than 490m handsets in the EU. Some 200bn text messages are sent every year in Western Europe.

The EU is fighting a cutting edge battle to ensure that the single market works fairly for European citizens. Anyone who supports the idea of an economically liberal Europe should be cheering it on.

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