BT and 3 UK launch MTR reduction campaign as Ofcom begins public review of rates

22 May 2009

British broadsheet The Guardian is reporting that fixed line incumbent BT and cellco Hutchison 3G UK (3) have launched a joint venture to press for a reduction in mobile termination rates (MTRs). The campaign, which is being marketed under the ‘Terminate the Rate’ banner, has already won the backing of the National Union of Students, the Federation of Small Businesses (FSB) and trade union GMB. The two operators claim that MTRs account for approximately GBP0.047 (USD0.074) of every call to a mobile voice line, and are calling for the rates to be reduced so that this drops to around GBP0.01 per call.

The inauguration of the campaign comes as regulator Ofcom begins a public consultation on charges between operators. Having set in place a programme in 2007 to reduce MTRs by around 25% by 2011, the latest review will examine the rates applicable between 2011 and 2015. Ofcom has set out six regulatory options, ranging from retaining the current system to more ‘radical alternatives’, including the complete removal of termination regulation from mobile operators. The regulator claims lower rates could allow operators to launch new, more competitive packages, and Ofcom chief executive, Ed Richards, noted: ’The mobile market has developed significantly with consumers increasingly using innovative services like mobile broadband. Our review will reflect these changes to ensure that future termination rates are in the best interests of consumers.’