Mobile phone charges to fall significantly

Landline users calling UK mobile phones may see cheaper bills from next year after a ruling by telecoms regulator Ofcom.

Ever since mobile phones first became an affordable option, many have tried to avoid calling them from landlines due to the substantial charges. This has improved over the years, when rates stood at 23p per minute in 1995, but they are set to continue falling to below 1 pence per minute over the next 5 years.

The regulator plans to cut the cost mobile phone companies can charge to connect a call from another network or land-line from 4.3 pence per minute to just 0.5p by 2015.

Ofcom has also made changes to the process of switching mobile phone companies, making it quicker and easier.

By 2011, it is hoped the time it takes to change mobile phone providers will fall from two working days to just one.

Ofcom added that mobile phone companies will be required to provide customers with the Pac code – used to allow users to keep their existing mobile number - by text message within a maximum period of two hours.

Some mobile phone companies currently provide these codes by letter only, which can take some time, increasing the switching period.

But, according to mobile phone operator 3, the move did not go far enough.

"The UK is the only country in Europe where you have to ask permission from your current operator to leave and take your mobile number with you," a spokesman said.

"[In other countries,] consumers benefit from near-instant porting and don't have to ask permission to move their number."

Research from Ofcom shows that 70% of customers want to hold onto their mobile number when  changing network providers.

The regulator said the new rules would mean cheaper calls to mobiles for over 32 million households and businesses that use landlines, saving a total of £800m over the four-year period the charges have been set for, according to Ofcom's  predictions

Although BT welcomed the moves, it was concerned that consumers and businesses would not see the full benefit of the lower rates until 2015.

"In this case, what is being proposed is just the elimination of excessive prices and the mobile operators have had plenty of notice that termination rates are likely to fall," the company said in a statement.

The new rules follow instructions from the European Commission that charges should reflect only the cost of establishing connection.

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UK Price Comparison website Which4U - http://www.which4u.co.uk/credit-cards/air-miles http://www.which4u.co.uk/bank-accounts/isas http://www.which4u.co.uk/bank-accounts/bad-credit-account

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