Ofcom Plan to Make Talk Cheaper – Mobile Calls to Drop in Price

All together now: “It’s about time!”

Good ol’ Ofcom has announced plans to cut termination rates. These rates are the wholesale charges that phone operators make to connect calls to each others’ networks. This means cheaper cross-network calls between mobiles and mobiles and landlines. 🙂

Under Ofcom’s new guidance the rates will fall from around 4.3p per minute today, to 0.5p per minute by 2015.

The existing rules regarding termination fees expire in March 2011 hence the push for new rules. Ofcom says that these cuts will lead to cheaper calls from landlines and increase competition now that the market is being overshadowed by data usage thanks to the growing hunger for smartphones and people side-stepping the market altogether by using VoIP.

The thing that we all want to know is how much we, the users, will get of this cut. I think it’s fair to say that most smaller networks may try to keep some of the savings to themselves, while bigger networks increase fees for things such as text and multimedia messages to make up for the lost revenue – the swines!

Saying that though; Kevin Russell, CEO of 3, told the BBC that 3 will be passing the full price cut to its customers and reap the rewards of a bigger cut in the market. Nice 🙂

The other bonus in this scheme is that we should be able to switch networks within one day and keep our memorised mobile numbers. The current system of getting a PAC code to switch can take days of painful negotiation and pleading!