Vodafone to Appeal Ruling on Cuts to Costs of Mobile Calls

Article excerpt

THE MOBILE phone operator Vodafone is this week expected to file documents in court that will kick off a judicial review into planned proposals to cut the cost of making calls to mobile phones.

The group is expected to file arguments about the processes the Competition Commission used to formulate the planned regulation rather than about the planned price caps themselves.

Last month, the Competition Commission confirmed it was inflicting a 15 per cent cut on all four mobile phone operators' call termination charges by 25 July along with other measures in a move designed to save consumers pounds 325m to pounds 700m over the next three years.

Termination charges are the fees that mobile phone operators charge other telecoms companies for connecting calls on their networks.

Vodafone and its rivals Orange, Deutsche Telekom-owned T-Mobile, formerly One2One, and mmO2, formerly Cellnet, have all balked at the proposals which are, ironically, harsher than the original recommendations made by the telecoms regulator Oftel.

They say it represents an attempt to micro-manage a highly competitive market, and that, by excluding the impact of the industry's pounds 22.5bn investment in third-generation (3G) licences, the Commission has got its economic models of the industry wrong. …