Submitted by Mike Grenville on Thu, 27 May 2004 12:11

The EU Commission has opened a consultation process on how its emoney Directive should be applied to premium rate SMS (PSMS) across Europe. "The industry must grasp this opportunity" says Andrew Bud of mBlox.

Different interpretations of the Directive has led to confusion across Europe that is hampering the growth of the mobile content industry. This is affecting the adoption of premium SMS (PSMS) as a micro-billing system that is fuelling Europe's billion euro market for mobile content (ringtones, logos, mobile information services and games).

Currently, the Directive is enforced at a national level by authorities afraid of infringing EU law and uncertain how to apply the directive to premium SMS and prepay mobile cards. The situation has varied widely, from the free and easy Netherlands to a complete block in Italy, with countries like the UK wavering in the middle.

It is hoped that this consultation process will address these issues. Behind the consultation paper lie emerging ideas on how the objectives of the directive, which are laudable and are designed to protect consumers, can be reconciled with the mobile industry to enable continued growth of business.

"In the face of widespread concern amongst national financial regulators, the EU's attitude is very constructive and it is now up to the industry to grasp this opportunity" said Andrew Bud, chairman of SMS infrastructure provider mBlox.

"We believe that emoney directive terms should only ever apply to the portion of the pre-pay balance that is on average used for third party PSMS payments. This will dramatically reduce operators' exposure to e-money terms and make it feasible for them to comply.

"We also believe that PSMS aggregators have the kind of close commercial relationship with operators that qualify for one of the Directive's waivers, exempting the operators from its rules altogether when working with aggregators..

"It is important that the well-established and sizeable mobile content industry makes its voice heard in counterpoint to the nascent electronic money industry, whose views have been very competently represented to the EU in the process so far.

Bud urges anyone with views on this issue to make sure they are heard - the EU welcomes comments from operators and their partners, content providers, technology developers and consumers. These comments will be published on the Commission website. Contributions should be sent by email before 16 July to
Markt-F2@cec.eu.int

"The consulation paper is available here: emoney consultation PDF

www.mobileentertainmentforum.org

www.mblox.com