Feeds

Oftel refers mobile companies to Competition Commission

They swear to fight it all the way

  • alert
  • submit to reddit

Top three mobile application threats

Oftel has referred the UK's mobile operators to the Competition Commission over their inter-network charges.

Oftel announced on 26 September that it was going to enforce an RPI -12 per cent control on mobile calls (i.e. if inflation - as measured by the Retail Price Index - goes up by five per cent, then prices will have to go down by 7 per cent).

It gave mobile companies a month to reply which they promptly did, calling it "flawed, inconsistent and incomplete". Oftel has refused to back down, claiming that mobile operators are ripping consumers off by charging "termination" rates when someone calls from one network to another. And so it has taken the step of referring the issue to the Competition Commission.

In a press release today, Oftel chief David Edmonds, said: "I regret that the operators have rejected the measures, as our proposals are proportionate and fair for consumers and the industry alike. [I] will now ask the Competition Commission to consider whether it is in the public interest for termination charges to be regulated. I am confident that charge controls are an appropriate measure to protect consumers."

He gave an example: "A peak rate national call over BT's network is currently 24 pence for three minutes, while the same call to a mobile network is 60 pence for three minutes, of which 39 pence is the termination charge."

The mobile operators are not amused. One2One has put out a response which begins: "We are disappointed that Oftel has announced its intention to refer its proposals on call termination charges to the Competition Commission."

The UK market is the most competitive in Europe, according to One2One which slams Oftel's "limited focus on one small, isolated aspect of the customer offering". It will be "vigorously contesting Oftel's arguments during the course of any Competition Commission inquiry".

BT Cellnet has called Oftel's price control "crude" and vowed to fight as well. A spokeswoman told us: "It is not in the customers' interests to impose this. Prices are coming down and we believe the market should now be decided through competition."

Vodafone will also contest Oftel's claims, a spokesman telling us that the controls "are not an appropriate form of regulation".

Orange has put out a five-page rebuke saying it "doubt the wisdom" of Oftel’s plan "to micro-manage one aspect of a successful, competitive industry". It calls the price control "anti-competitive and against the consumer interest".

Oftel's press release draws reference to a precedent for its decision. It points out that the new price controls are a review of ones due to expire in March 2002. These controls were originally created after an investigation by the Monopolies and Mergers Commission (now the Competition Commission) into Vodafone and BT Cellnet's termination charges in 1998. It stemmed from an Oftel referral. ®

Related Link

Oftel's press release

Related Story

Mobile operators slam Oftel's price cut plans
Oftel strengthens mobile price controls
Oftel tries to look brave criticising mobile companies

High performance access to file storage

More from The Register

next story
This time it's 'Personal': new Office 365 sub covers just two devices
Redmond also brings Office into Google's back yard
Kingston DataTraveler MicroDuo: Turn your phone into a 72GB beast
USB-usiness in the front, micro-USB party in the back
Dropbox defends fantastically badly timed Condoleezza Rice appointment
'Nothing is going to change with Dr. Rice's appointment,' file sharer promises
Inside the Hekaton: SQL Server 2014's database engine deconstructed
Nadella's database sqares the circle of cheap memory vs speed
BOFH: Oh DO tell us what you think. *CLICK*
$%%&amp Oh dear, we've been cut *CLICK* Well hello *CLICK* You're breaking up...
Just what could be inside Dropbox's new 'Home For Life'?
Biz apps, messaging, photos, email, more storage – sorry, did you think there would be cake?
IT bods: How long does it take YOU to train up on new tech?
I'll leave my arrays to do the hard work, if you don't mind
Amazon reveals its Google-killing 'R3' server instances
A mega-memory instance that never forgets
prev story

Whitepapers

Top three mobile application threats
Learn about three of the top mobile application security threats facing businesses today and recommendations on how to mitigate the risk.
Combat fraud and increase customer satisfaction
Based on their experience using HP ArcSight Enterprise Security Manager for IT security operations, Finansbank moved to HP ArcSight ESM for fraud management.
The benefits of software based PBX
Why you should break free from your proprietary PBX and how to leverage your existing server hardware.
Five 3D headsets to be won!
We were so impressed by the Durovis Dive headset we’ve asked the company to give some away to Reg readers.
SANS - Survey on application security programs
In this whitepaper learn about the state of application security programs and practices of 488 surveyed respondents, and discover how mature and effective these programs are.