Consumers can expect €100m savings on telephone bills

THE Commission for Communication Regulation (ComReg) has claimed Irish consumers can expect e100m in savings on their telephone bills, thanks to a reduction in mobile termination rates.

The rates are to be cut by almost 50% over the next three years.

Mobile termination rates (MTRs) are the wholesale charges which operators, both fixed and mobile, pay to mobile operators for calls that are connected on their networks.

At present a retail fixed customer may pay a peak rate of e21c or an off-peak rate of e13c to call a mobile network.

The average wholesale rate that fixed operator will pay to the mobile network which the call is terminated on is just under e10c.

A mobile customer may pay an anytime rate of 25c on an off-net call to another mobile network, the average wholesale rate that fixed operator will pay to the mobile network which the call is terminated on is just under e0.10.

Mobile termination charges as a percentage of retail mobile and fixed prices varies greatly due to the fact that there are different published wholesale mobile termination charges for each mobile network operator, priced on a peak/off-peak/weekend basis. This coupled together with the fact that the majority of mobile and fixed retails customers enjoy bundles of talk minutes, through a bundled pricing plan, makes it difficult to calculate the relationship across the board.

However, the charges could be up to 60% of the total costs of retail mobile off-net call or a fixed to mobile call.

They affect consumers indirectly as they are factored into the prices consumers pay at retail level for fixed-line-to-mobile and mobile-to-mobile calls.

Therefore, the commission predicts the reduction in MTRs will amount to potential savings in the order of e100 million for consumers from 2010 onwards.

“Ireland’s three largest mobile phone operators — Vodafone, O2 and Meteor — will reduce mobile termination charges on their networks in line with similar reductions in other European member states,” the commission said.

ComReg chairman John Doherty said “these reductions by the mobile operators should deliver significant cost savings to Irish consumers over the next three years and ensure Ireland remains competitive among its European peers.”

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