BBC Home > BBC News > Business

Mobile phone rates and your bill

1 April 10 11:16 GMT

By Kevin Peachey
Personal finance reporter, BBC News

Calls made to mobile phones are set to become cheaper under plans outlined by the regulator Ofcom.

The decision surrounds the rates which mobile network operators charge to handle other networks' traffic.

Cheaper bills should start coming in from 2011 and be fully in place by 2015.

So what do the changes mean for you?

BEFORE

Ofcom had to act after the European Commission said that the charges should reflect only the cost of establishing connection.

These fees, called termination charges, have fallen substantially as mobile phone usage has grown. In 1995, the cost was 23p per minute.

But there was also widespread difference across the EU. When the Commission studied the sector in mid-2008 it found that call termination charges ranged from 2 euro cents per minute in Cyprus to 18 euro cents in Bulgaria.

It also found that the fees that operators levied for switching callers between each other's networks were, on average, nine times higher than those on fixed-line networks.

The current termination charges regime set by Ofcom in the UK was set to expire in 2011.

Another concern for consumers has been the time it takes to keep the same number when switching providers. This often has to be done in writing and can take several days.

AFTER

Bills are expected to fall.

Ofcom has proposed cutting the cost mobile phone firms can charge for connecting a call from another network from 4.3 pence per minute to 0.5p by 2015.

The providers are expected to pass on these savings to consumers. However, there is a possibility of higher handset charges, or increased prices for some other services.

By next year, it should only take one working day, rather than two, to change mobile phone provider. The process of keeping the same number should only take up to two hours - instead of in writing, this will be done by text message.

OTHER ISSUES

• There has been criticism from consumer groups of the "bewildering" number of charging packages available to consumers, although this does mean customers can often negotiate on deals.

• New rules are in force aimed at preventing companies from "slamming" - the process of switching a customer's provider without their permission.

• From 1 April, BT's free evening and weekend call plans start an hour later. So, these free calls start at 1900 BST rather than 1800 BST on weekdays.

Share this

Related BBC sites

*