News Burst: Oftel launches review of mobile phone charges

Is the UK mobile phone market so uncompetitive that price controls are needed? Oftel intends to find out

Telecoms watchdog Oftel today launched a consultation into the current controls on mobile phone charges on BT Cellnet and Vodaphone networks.

The review will consider how competitive the mobile market is, and will decide what level of regulation is appropriate for the mobile industry. It will focus on "termination charges" -- the price paid when a mobile user calls a mobile on a different network -- which typically make up two-thirds of the cost of a call to a mobile phone.

The current controls on mobile phone charges run out in 2002. They were set in 1998 after the Monopolies and Mergers commission decided that mobile phone charges were too high, and Oftel believes these current charges will save phone users £1bn.

If Oftel concludes that there is not enough competition in the mobile phone market it is likely to impose new price controls after 2002.

Full story to follow.

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