Vodafone Group is to cut the cost of roaming European calls by 40 per cent in an effort to avoid possible European Union regulations and reduce charges for customers.
Over 30 million Vodafone customers could see roaming charges drop from 90 cents a minute to 55 cents by April 2007.
The company also plans to offer reciprocal agreements to other European operators that would see a 45 cent per minute charge for roaming calls compared to the wholesale rate of 70 cent per minute by October 2006. Other European providers would agree to offer in return an average charge of 45 cents per minute.
The European Commission is looking at legislation that would eliminate roaming charges. In March the European Regulators Group (ERG) suggested placing a cap on wholesale roaming prices. Such a cap, it argued, would reduce charges by 60 per cent.
"The European Commission and European Parliament have made it clear that they expect to see change," Arun Sarin, chief executive of Vodafone, said in a statement.
By reducing the cost of wholesale and retail prices, Vodafone was "providing a platform for sustainable, lower retail prices across Europe in the future".
Mr Sarin also said the market was the best mechanism to "meet customer needs, not regulation". Other Irish mobile service providers may follow.
A spokeswoman for O2 Ireland said the company was looking at European roaming charges. "It is something we are working on," she said. A spokeswoman for Meteor said it had no "public plans on that issue yet".
European Commissioner for Information and Media, Viviane Reding, welcomed the move. "This... is the right move in the right direction," she told a business lunch in Madrid.
"I will also see if there is something in the proposal, for instance, concerning incoming calls. I'm going to be very interested to see how the Vodafone's competitors are going to react." Brussels has long indicated concern about roaming charges.
In February 2005 the EU executive formally charged Deutsche Telekom's T-Mobile unit and Vodafone for overcharging visitors from abroad when they used mobile phones in Germany. - (Additional reporting, Reuters)
