Mobile phone price concerns

Calls between mobile networks are too high

Oftel, the UK telecom regulator, has found that competition in the mobile phone market has not brought enough benefits for consumers.

The watchdog said that the level of profits made by mobile phone companies shows that competition in the sector is not yet fully effective.

In its initial review into the industry, Oftel reported that UK customers do not seem to get a good deal on international roaming and calls between different mobile networks.

The regulator is also concerned that many consumers find information on mobile telephony products confusing.

However, Oftel did say that consumers are getting a good deal for many other mobile phone services.

Price falls

Mobile phone prices have fallen by 24% since January 1999, and continue to decrease.

Oftel also found that prices in the UK compared favourably with trends in other European countries.

The regulator now plans to consult industry and consumers, before drawing up its final conclusion, which will be announced in July.

David Edmonds: guarding against anti-competitive behaviour

If the final conclusion finds that competition is fully effective, Oftel will lift regulations designed to encourage competition.

This would include any requirement to provide wholesale airtime to independent service providers, which piggyback off mobile phone networks.

Mobile phone companies also have to allow indirect access operators, such as utilties that offer telephony services, access to their networks.

But if the level of competition is not as it should be, the regulator could impose further regulation on the main offenders.

"This could result in two, three or even all four operators being subject to regulations that guard against anti-competitive behaviour and promote competition," said David Edmonds, director-general of Oftel.

The mobile phone operators in the UK are Vodafone, BT Cellnet, One-to-One and Orange.