Investigation into UK Mobile Termination Charges Begins

The UK's Competition Commission has sent an alert notice to the country's four mobile network operators, Vodafone, BTCellnet, Orange and One2One, and to the telecoms regulator, Oftel, as part of its inquiry into the cost of calls to mobile phones. The Commission has identified a number of issues that it wishes to consider, arising from the evidence received to date from the main parties, and other interested parties. These issues will form the basis for the Commission's findings on the question whether the mobile network operators' termination charges are too high and, if so, whether it is in the public interest for such charges to be regulated.

The Commission will shortly hold a number of hearings with the main parties to discuss these issues. The Commission was called in to investigate these issues by the regulator itself after it was unable to resolve its concerns with the networks directly.

The Commission will be looking to see if there is sufficient competition in the mobile interconnect market, and if price controls are needed to push down the termination charges made by the mobile phone networks. The report will also include looking at 3G networks as well as alternative termination points, presumably including VoIP services. The Commission is also concerned that high termination charges may be used to subsidize lower outgoing call charges, effectively shifting the network's own costs onto non-customers.

The report will also look at some related issues, namely whether the consumer tariffs need simplifying to make comparisons between the networks easier for customers, and whether, if termination charges were further reduced as a result of regulatory action, the networks would be likely to increase their prices for other services and whether this would operate against the public interest.'"

Posted to the site on 2nd April 2002