BT today confirmed that it plans to reduce its charges for customers calling from their fixed lines to mobile phones. The move follows Oftel's announcement that the four UK mobile operators should reduce their fees for terminating calls on their networks by 15 per cent, by July 25, 2003 and by at least RPI-14% for the 3 years thereafter. BT will pass on the benefit of these savings to its customers.
Angus Porter, managing director of BT's consumer division, said: "This is good news for BT customers. Our feedback showed that the high cost of calls to mobiles was an issue for consumers. As the charges appeared on their BT bill, it was often BT that was blamed for the prices they had to pay when in fact we simply collected a large part of the money on behalf of the mobile operators.
"The Competition Commission's decision to reduce the cost of calls to mobiles will lead to lower overall bills which means better value for money for our consumers."
In the last full financial year, 2001/02, BT Retail recorded approximately GBP1.2bn of revenue from its customers' calls to mobile phones. In the same period BT Wholesale also recorded more than GBP1.2bn in transit revenue from calls terminating on the networks of the mobile operators.
It is expected that today's ruling will reduce these revenues in both BT's retail and wholesale arms. Profitability in both areas will remain unaffected because a large part of these revenues are simply collected by BT and paid on to the mobile operators.