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Strand Consult´s research notes about roaming:


13 things the EU forgot to say about the new “Roam Like at Home” regulation starting June 15th and its impact to 500 million Europeans

Let's acknowledge that the EU is in the midst of an historic crisis and an increasing number of Europeans are skeptical about European integration and EU leadership in Brussels. Over recent years, panic has spread among politicians, especially among the most ardent EU supporters, who cannot relate to criticism of what is happening in the EU. Simply put, the EU system is desperate for stories and policies that will make the EU look good in Europeans’ eyes. EU officials believe roaming will make the Union popular again, or at least remind voters that Brussels is good for something.

The project to offer “Roam Like at Home” from June 15 is probably the biggest media stunt in the history of the EU and a risky gamble that may well backfire. This note describes that the EU system is not telling the truth about “Roam Like at Home” and its potential impact to 500 million Europeans. This note also documents how EU officials have imposed gag orders against mobile operators, industry experts, and the press in the information they can share with the public. Strand Consult’s goal is to create full transparency to the public about what happens behind closed doors in the EU, including the correspondence, documents and notes Strand Consult has received from EU officials.

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EU mobile roaming policy is a bomb under the MVNO industry and DG Comp’s merger conditions
Europeans have been dissatisfied with the EU government for years. Political parties skeptical of Brussels have had a resurgence. To combat its image problem with the voters, pro-European politicians have pursued the policy of free mobile roaming as a means to make the EU popular again.  While the impact to consumer prices in the short run is minimal (there are already products on the market that offer a better value), the long term consequences for the mobile industry are disastrous.

Strand Consult’s satirized the EU’s aggressive effort to impose price controls in its April Fool message announcing that the EU would harmonize caffe latte prices across the 28 member states.  While most readers recognized the joke, there are a number of bureaucrats in Brussels who support such central planning, especially with mobile subscriptions. Without fail, the European Commission releases press announcements in time for spring and summer vacation to say that the “roam like home” project is on track.
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How the telecom industry will experience disruption - threats and opportunities.

Disruption is a both a creative and destructive competitive force. Even though we have experienced convergence for decades, policymakers are reluctant to adapt regulation to the new reality. Rather than embrace a modernized competition framework across markets, regulators double-down on old-fashioned sector specific telecom regulation. Policies such as roam like home, net neutrality, set top box regulation, and aggressive access mandates, hobble telecom providers while giving over the top (OTT) players and resellers an undue advantage. These policies, propagated under the guise of “enhancing competition”, actually distort it.

To be sure, telecom regulators might not have the statutory authority to regulate international/foreign OTT providers, but that is not an excuse not to do the right thing. When telecom markets are competitive, ex ante regulation is supposed to be removed and general competition regulation put in its place.

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BREAKING NEWS: Based on the success of "roam like home" for mobile services, the European Union launches an effort to harmonize caffe latte prices in the EU.
It is not a secret that the EU has an image problem among many citizens in Europe, an issue demonstrated when Great Britain activated Article 50, starting the formal administrative process to leave the EU. A major study carried out by the EU Office for the Improvement of the European Commission’s Image (EBIECI) shows that the fight against roaming and “roam like home” has succeeded to improve the EU's image among citizens.

A secret task force led by former Commissioner Neelie Kroes spent the last six months in the Bahamas to develop a plan on how to leverage the experience of "roam like home" to improve the EU's image. The conclusion is that harmonization of caffe latte prices in Europe could also be helpful to improve the EU’s image among Europeans.

Pro-European and Member of the European Parliament Jens Rohde of the Danish Social Liberal Party and fellow architect of "roam like home" calls the move to harmonize coffee price as one of the most important things that has happened in Europe since he was elected to the Parliament. He reports, "In Denmark a caffe latte easily cost 6 euros, and it should be seen in light that the average Dane spends 16 euros on his phone bill a month. In practice there are many Danes who spend more on caffe latte than they spend on their mobile bill. Thus harmonization of caffe latte prices is a natural extension of the harmonization of roaming prices."
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If the goal of the Open Internet is to ensure users’ rights and a good network experience, why did the EU ignore 8 telecom regulators who wanted to expose bad smartphones?

Strand Consult has for many years focused on providing consumers with good mobile network experiences. In May 2013 we released the research note Telecom regulators in 8 countries launch war against smartphones, say consumers require transparency describing in how telecom regulators in 8 countries asked for EU support to expose bad smartphones.

Unfortunately, the EU closed its ears to the telecoms regulators from Denmark, Estonia, Finland, Iceland, Latvia, Lithuania, Norway, and Sweden. Instead it gave overwhelming attention to Google's and other US-funded net neutrality activists.

There is much academic evidence that shows that the vast majority of poor mobile experience results not from the network, but from the phone. But this is not a sexy thing for the EU to regulate, as people love their phones and phone makers run circles around regulators. Besides, it’s just easier to blame bad experiences on mobile operators, even if there is no evidence for it. Regulation by the EU is not about righting a wrong, facilitating market entry, or creating competition. It’s about creating a story that EU is doing something for the consumer. As such, roaming and net neutrality rules were announced in time for summer vacation, but neither of these measures create jobs or stimulate growth, the point of the Digital Single Market exercise.

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Roaming proposal shows that EU telecom policy is falling apart. 13 questions on roaming and fair use for European Commission. Strand Consult Research Note

The revised EU proposal on roaming shows that the European Commission faces an existential crisis. It cannot succeed to make telecom policy that incentivizes new economic growth; it can only impose regulation. The EC press release on roaming purporting “to make it work for all Europeans” means that it has made a mess of roaming regulation which it leaves to the member states to clean up. With this desperate attempt to look like it is doing something for consumers with lower mobile prices, the EC is worsening the already moribund environment for infrastructure investment and unwittingly imposing a roaming surveillance regime on European citizens in the name of ensuring “fair use”.

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EU's new "Roam like home" model will hurt the mobile industry, restrict competition, reduce the range of mobile products, and increase prices in a number of countries.

EU is suffering the worst identity crisis since the union was created. Politicians and bureaucrats are desperate to demonstrate doing something good for the people. They thought cheap roaming was a sure thing to win satisfaction, but no. This research note describes why the cheap roaming will fail and how the EU’s plan will backfire and create resentment among European consumers.

Let me start by saying that we are not impressed by operators' ability to communicate the seriousness of these challenges. Strand Consult believes that operators tell the truth about roaming, it will have a negative impact on their stock price.

At the same time there are some naïve people in Brussels who think that high roaming prices is a simple matter that price controls can resolve. If you do not take into account how a mobile operator works, the cost of traffic, the cost of wholesale access, and other cost difference between countries, then the economic consequences of roaming regulation are not so bad.

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Strand Consult 2016 Telecom Predictions

Another exiting year has flown by, and we would like to take this opportunity to thank you for the past year and wish you a Happy New Year. This is our 15th year of making predictions. We invite you to see the predictions from past years.

Review of 2015
For Strand Consult 2015 was another exciting year, and we find that more and more operators use our knowledge to achieve their business goals. The combination of our knowledge with out of the box thinking helps operators navigate a turbulent world where political and regulatory hurdles increasing hinder the telecom industry's ability to deliver results.

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Predictions for 2014: What to expect in the mobile telecom industry

2013 was a great year for Strand Consult and its team of experts. We have never published so many new reports or have been involved in so many interesting projects around the world as we have this year. Globalization is exciting, and it forces reluctant national regulators to think in new ways. One of our key accomplishments was to help operators optimize their business case to build and run mobile infrastructure. As a result of our work, Denmark is one of the few countries in the world where operators experience vastly improved conditions to deploy mobile infrastructure. This is part of a multi-stakeholder process with regulators, municipalities, and operators to improve mobile coverage.

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Mobile World Congress 2014 - a Preview by Strand Consult

Will 2014 be the “moment of truth” when regulators finally realize the challenges posed to the by OTT players? Or will regulators be like the captain of the Titantic, ordering the orchestra keep playing while the ship sinks? On Monday 70,000 mobile industry professionals will converge in Barcelona for the Mobile World Congress.

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”Roam like home” is probably dead
- EU Commission’s digital single market proposal raises more questions than it answers
A week ago the EU Commission presented its proposal for the Digital Single Market Connected Continent including the “roam like home” mobile roaming plan, and a debate erupted. Strand Consult is pleased that the Commission made an effort to address digital competitiveness and hopes that the proposal can be the foundation for a constructive discussion on how to develop the European telecommunications sector and to solve some of the challenges the industry faces, particularly those around incentives for investment. Strand Consult has already published two research notes where it reviews the proposal in detail. Read the first research note and read the second research note.
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Lack of telecom investments will create the next EU crisis. Action from the Commission is too little, too late, and too slow

The EU was hit by a financial crisis in 2008, and it is on track to be hit by a digital crisis. Bad telecom policy has deterred investment in the region for a decade. Europeans will not be able to get networks when they need them. It’s not a question of subsidies; there is enough cash flow in the industry to make investments. Operators make the minimal investments to defend existing networks, but no European operator can justify larger outlays in such an uncertain regulatory environment.

The new EU commission has made important strides to an improved telecom framework, but they need to implement quickly. It has already been a year since Strand Consult made this research note about the coming digital crisis and to comment on Neelie Kroes package for the Connected Continent and digital single market. Telecom investors still see an uncertain future for telecom.

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EU´s roaming regulation is a form of zero rating and probably violates net neutrality

One of the European Commission’s regulatory campaigns is to end mobile roaming charges. Every year just before Europe’s summer vacation, the Commission reminds people that they should be able to enjoy voice, SMS or data on their phones when they travel at little to no additional charge. Already the EU’s mobile roaming regulation caps the price that operators can charge when users travel outside their home country. These rules are in place to “ensure that mobile phone users do not pay excessive prices” and to “boost competition”. A video cartoon on the Commission’s website explains the EU policy and describes the benefits. As it turns out, these are exactly the same benefits users receive from zero rating, a practice of exempting charges from a user’s mobile subscription.

Zero rating is a practice by mobile operators in which traffic is not charged on a mobile subscription. About half of all mobile operators worldwide for the better part of the last decade have used it. In the same way as millions of companies offer 800 and toll-free telephone numbers, customers expect that they need not use valuable minutes to call their mobile provider’s customer service department or to access their providers’ website when they top up their account balance. The practice is also used as a way for mobile operators to compete and lower costs to end users, just as the the EU roaming regulation purports to do.

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Europe’s Disconnected Continent: The next crisis hitting the EU will likely be digital—and long and expensive for society
There is much discussion about the EU telecoms package "Connected Continent: a single telecom market for growth and jobs", and EU leaders are proud to have introduced rules on roaming and net neutrality. These so-called consumerist policies have largely been the focus of the media while the proposal’s 7 pillars and over 100 sub-items have been overlooked. The EU telecoms package can have a profound impact on the telecommunications infrastructure that is the foundation of modern European information society.
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EU Vote on Roaming Net Neutrality: Monitoring citizens’ mobile use is okay, but don’t touch the internet
The proposal adopted by EU parliament today will not solve the big problems there are in the EU when it comes to providing citizens with access to broadband infrastructure.
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EU telecom regulation is the art of the possible. This week’s ITRE Committee vote kills net neutrality to save free roaming. But rest assured that net neutrality will be resurrected, once EU leaders have assured their re-election

While the EU Commission has pursued a lot of nice-sounding policies, it has avoided fundamental reforms that would reverse Europe from falling behind in the digital economy. When it comes to the digital single market, EU leaders have shown that the next election is more important than Europe’s competitiveness in the global economy. Strand Consult’s report Understanding Net Neutrality and Stakeholders’ Arguments reviews Europe’s many economic challenges and examines EU telecom regulation and politics.

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The new EU proposals on how to harmonize the European telecommunications market has gained a lot of attention
- Here's the straight talk version of what the EU Commission said
The new EU proposals on how to harmonize the European telecommunications market has gained a lot of attention. Here's the straight talk version of what the EU Commission said.

A few weeks ago the European Commission led by Neelie Kroes published their proposal on how to regulate the telecommunications market. There is no doubt that the commission has some noble goals. At the same time the suggestions have inevitable and enormous consequences. As such, it is appropriate that there is a vigorous debate. It can be taken as a sign of democracy.
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EU Commission proposal for cheaper roaming means collapse of the European mobile industry
-Massive cost-cutting programs will increase unemployment
-The European telecommunications sector will stop investing
The new EU roaming rules are created to sound good in voters' ears, but unfortunately, Neelie Kroes and her team have not thought through the economic consequences for the telecom industry and Europe with the roaming proposal. Strand Consult has analyzed the proposed roaming plan. This research note follows a note about the EU Commission's plan for an overall digital single market. Read the earlier research note. While it is a heroic idea to make mobile roaming cheaper, the proposed plan will put an end to investment in mobile infrastructure including deployment 4G/LTE deployment, the very thing that the Commission wants to support to create a connected and more competitive continent. It will also mean massive dismissals of employees in the European telecommunications industry. The plan, if implemented, will create perverse incentives for arbitrage and border trade in mobile telephony.
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