UK telecoms regulator Ofcom announced proposals to further cut mobile termination rates (MTRs) in a bid to reduce the wholesale cost of mobile calls — and retail prices as a result.
Ofcom is proposing that a new charge control be applied, meaning the price charged by operators for connecting calls from a different network would fall to less than £0.005/minute in real terms by April 2017.
The regulator last reviewed MTRs in 2011, after which it imposed control on the rates charged by the four UK operators: EE, Vodafone, O2 and 3 UK.
Industry rates have since fallen by around 80 per cent from £0.04/minute to £0.008/minute. Termination rates a decade ago were significantly higher at £0.14/minute.
The mobile market has changed significantly since Ofcom’s last MTR review, with increased amounts of spectrum available following the release of 4G spectrum in 2013 and all four operators now offering 4G services.
In addition, mobile networks and technologies are becoming more efficient, meaning costs have fallen for operators — something that is reflected in the proposed charge controls.
“We want to ensure mobile users continue to benefit from competition, which will deliver affordable services in the years ahead,” said Brian Potterill, Ofcom competition policy director.
A consultation period for the proposals runs to 13 August 2014, with Ofcom planning to publish its final decision by March 2015.