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Mobile phone charges could fall up to 80%: Ofcom announce rate cut

Ofcom has announced a reduction in rates across UK mobile phone networks, which should see decreases in charges for cross-network calls.

Technically called mobile termination rates, they are what networks charge each other to connect over rival mobile phone networks, and Ofcom say the reductions are “designed to benefit UK consumers.”

From the start of April 2011. the regulators at Ofcom will set a cap on the rates phone networks will charge, leading to a decrease along the next four years. Here’s a nice line graph to show how rates have tailed off, and how they’re now expected to drop further.

Ofcom say that this should mean two differences to what we pay. Firstly, more choice for customers as the lower charges should make the UK mobile networks more competitive and give us more choice in what we get from them; Ofcom mention pricing flexibility and a greater range of packages.

We’d love a bit more flexibility on network packages, not many texts, but lots of voice minutes? Minimal call and text allowances, but a ton of data?

These lower rates should also make landline services cheaper, reducing the cost of calls to mobiles, and some service providers are said to have already promised reduced prices.

This new reduction in rates was initiated as calls to mobile take a backseat to data. Last year saw a 104% rise in volume of data across networks, while Ofcom expects continued data revenue growth in the future.

Mobile phone networks may lose some money from the changes to voice calls, but given the shift from voice calls to data services, like internet, email and all those apps, they shouldn’t feel too much of a sting.

 

Source: Ofcom

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