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Mobile Phones – Ofcom Calling for Cap to Cross-Network Call Charges

Posted 29th March 2010.

The result of this price cap could cost the mobile industry upwards of £1 billion, potentially reducing the prospect of future financial investment in the industry. At present the likes of BT get hit by a staggering £750 million phone bill each year connecting landlines to mobile phones networks. A cap would appease this problem, but it would create issues for mobile phone carriers who would likely have to bump up pay-monthly subscriptions and consider scrapping pre-pay methods as a result.

Many mobile phones networks could threaten to remove their short and medium term investment in the mobile industry if Ofcom succeeds in implementing such a deal. This could also hamper potential enhancements to the UK mobile broadband services that are continuing to be rolled out on a constant basis.

The drop of termination rates and cross-network call charges could potentially cut the cost of calls to less than 1p per minute. The threat of mobile phone networks pulling out of their investment is realistically likely to force regulators hands as they search for some form of middle ground agreement.

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