Orange and One2One could face Oftel controls

Regulatory grip may tighten on mobile firms

Telecoms watchdog Oftel might be about to extend its controls over mobile phone operators One2One and Orange (quote: ORA).

It announced Tuesday that it is reviewing its controls over the mobile industry, which currently only covers BT Cellnet and Vodafone. The current controls limit the amount that BT Cellnet and Vodafone can charge for a call either from a fixed line or from another network. Two years ago, when those controls were put into place, neither Orange nor One2One was regarded as a major player and neither was included in the regulation.

However that could be about to change, as Oftel looks again at regulating the mobile industry. "We might decide to extend our controls to cover One2One and Orange, as they've grown enormously since 1998," an Oftel spokeswoman told ZDNet. A decision will be made in July.

An Orange spokeswoman insisted that Oftel's announcement did not apply to it, refusing to comment directly but referring ZDNet to a statement released earlier this month.

"We have just introduced new international tariffs which provide our customers with a worldwide flat rate scheme which removes the difficulties in calculating overseas call charges. Also recently introduced is the Choose Your Own Off Peak plan, which allows customers the freedom of making off-peak calls day or night," the statement read.

This statement was released after Oftel declared earlier this month that the UK's mobile phone companies were making excess profits.

BT Cellnet agreed that extending current controls to its competitors could make sense. "All four operators have very similar market influence today, so one could argue that it would be fairer to treat all four operators the same way," a spokeswoman said.

The BT Cellnet spokeswoman also insisted that the mobile market was in a better state than in 1998 when price controls were introduced. "This is a hugely competitive industry, with 40 million mobile users in Britain. The market isn't as it used to be, as it's not just voice any more," she said, referring to the massive growth in SMS, or text messaging.

The Oftel spokeswoman admitted that the watchdog was receiving much fewer complaints from the public about mobile phone charges than a few years ago.

Many experts believe that mobile phone users are using text messages, which cost an estimated 10p each, as a cheaper alternative to making a call to another network. Oftel's spokeswoman explained that this was something it was investigating. "We're going to look into the effect that text messaging may have on competition, if people are sending an SMS instead of calling a mobile, However, it's only a very small part of our review," she insisted.

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