Ofcom Set To Review Mobile Termination Charges

Ofcom has published a report about the controversial mobile termination rates which could well deliver the biggest shakeup in the UK mobile telecoms market yet.

The document is part of a wide consultation that will look at how much mobile calls will cost over the next few years and is expected to end on the 29th of July 2009.

Termination rates make up 14p in every pound spent on mobile calls and the concept is currently being fought by BT and 3 which have join forces to lobby for its elimination.

The telecoms regulator will be looking as how termination charges will move between 2011 and 2015. Ofcom has already stipulated that it wants prices to fall by around a quarter by 2011.

Ed Richards, Ofcom's Chief Executive, said that "The role of termination rates in mobile services has attracted enormous controversy. That is why we are determined to examine them from first principles. This consultation gives consumers and industry an opportunity to debate the fundamental questions."

Ofcom has said that it will be looking at 6 potential options that will include a sliding system that will see rates going down every year to one where the customer's network will be responsible for all costs associated to making a call.

However, there are fears that altering the status quo could coerce the mobile networks to start charging for receiving calls which could forever change the way people use their phones.

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Altering the MTR scheme could also mean the end of free phones with line rentals as well as less competition should smaller players like Virgin media and 3 decide to call it a day. The issue is that MTR is essentially free money for the big mobile phone operators and eliminating MTR completely will encourage them to go elsewhere.

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