The European Union Flirts With Regulatory Action Over Mobile Marketing Expenses

As we approach the July 4th holiday, there are reminders all around of our freedom, especially when it comes to our mobile phones and the freedom of marketers to reach us constantly with their product or service de jour.

Across the pond, however, the European Union continues to emphasize its July 1 deadline for the mobile industry to “either cut the cost of cross-border text messaging or face legislative restrictions.”

Although European operators are resisting regulatory intervention much the way US operators would resist the same at home, it looks as though the EU isn’t going to relent until they see the “exorbitant costs” associated with mobile marketing endeavors brought down to a minimum.

In an action that those of us in the states find altogether foreign, the EU’s telecoms commissioner said legislators will regulate the wholesale tariffs charged by operators for cross-network calls, arguing the current system distorts competition between carriers and results in consumers paying too much.

Information possessed by the EU suggests that the average cost of a text message within national borders is between 5 and 10-euro cents (or 8 to 15 cents in the U.S.), but the average cost of sending one abroad is 28-euro cents (43 U.S. cents).

Apart from efforts to harmonize both text and voice termination prices, also being sought is a reduction of consumer costs by as much as 70 percent from their current levels. Needles to say, such consumer advocacy has its merits, but the next time we complain about surging text prices and the fallout expenses from mobile marketing campaigns, let’s keep in mind that while the European model may stress forcing the market to do something, let’s be thankful that the American way is to encourage free market growth and competition, two things that will ultimate keep prices low and both consumers and marketers happy.