Calls to Europe: Why the Sudden Changes in Prices?

Maybe some of you who has some personal or business connections in Europe noticed a drastic changes in call rates when trying to call friends, family or business partners in different European Union countries. What has happened? Is that some kind of attempt from malicious and dishonest phone operators to rip you off? Well, not exactly so. The answer lies in changes in EU laws regarding international phone calls that are taking place since the start of this year.

But first - lets look a little back at the history of EU regulation of international calls that might explain why calling some of the EU member countries have been such a bargain so far. Some years ago EU officials decided to reduce call prices among different countries in European Economic Area (EEA). This means that regulations were put in place that set the price ceiling for wholesale call prices. This meant that most phone providers not only couldn’t raise their prices anymore, but were forced to gradually reduce them to be in the wholesale price range set up by law.

For example, it was decided that phone providers in Lithuania could not raise their prices from January 1st to March 31st 2013, and since April 1st 2013 they had to gradually reduce their prices starting from 36 percent on average according to cost accounting methodology in official European Comission reccomendations.

Wholesale prices for call in fixed and mobile telephone networks is used when different providers pay each other for calls that users of one service provider make to users of other service provider. Reduced wholesale prices allowed customers in whole European Union to enjoy more different services for lower prices.

But not everyone was happy about it. Because of slightly different rules and laws in different EU countries, phone service providers in some countries were able to apply price ceiling only to call flow from EEA countries, while prices for calls from third party countries were not regulated. Meanwhile in other EU countries call flow was undifferentiated, which means that prices were regulated for all foreign calls despite their origin - whether they were from EEA countries, USA, Asian countries or anywhere in the world really.

This of course caused great discontent among phone service providers in those EU countries. The system was regarded as highly discriminatory. This meant, e.g., that American phone service providers could set whatever wholesale call prices for Lithuanian phone service providers, but Lithuanian providers were limited by their price ceiling. Therefore EU officials decided to ensure that since 2016 every EU country had a call differentiation according to their origin practice; that way regulated prices could only be applied to call flow from EEA countries.

Many EU countries with previously undifferentiated call flow practices have already started differentiating foreign calls according to their origin and many are planning to do that in the nearest future. The general trend is that more and more EU countries are jumping the ship and exercise the option for their phone service providers to get rid of price ceilings for call flow from non-EEA countries. For example, Lithuania took this opportunity from January 1st 2016 and Poland - from April 1st 2016.

When choosing a phone service (for international calls) I prefer: