Mobile phone industry executives have condemned plans by the UK’s communications industry regulator, the Office of Communications (OFCOM), to slash the cost of calling a mobile phone.
They say the move could stifle investment in the next generation of super-fast mobile broadband networks, end free mobile (cellphone) handsets for contract customers, price millions of pay-as-you-go users out of the market and lead to a flood of job losses.
The regulator on Thursday prepared for a fight with the UK’s big four networks — O2, Orange, T-Mobile and Vodafone — by proposing a 90 percent drop in mobile termination rates, the charge the operators levy on each other and on fixed-line companies to connect calls, when the current price cap regime ends next year.
The move could save UK consumers and businesses almost £800 million (US$1.2 billion) a year from 2015, and lead to cheaper calls for Britain’s 32.7 million homes and businesses with a landline.
However, mobile phone industry executives accused OFCOM of trying to grab headlines with its second consumer-friendly move of the week following its call for satellite broadcaster Sky to drop the cost of Sky Sports, to fend off a threat from the Conservative party — if successful in the forthcoming UK general election — to reduce its powers.
“This is a backward step for Britain,” a spokesman for Orange said. “If these measures are put in place they will stifle innovation.”
A Vodafone spokesman said: “A cut of this magnitude deters future investment, makes it less likely that the UK will continue to lead in mobile communications and is at odds with the government’s vision of a Digital Britain.”
OFCOM is adamant that the mobile phone companies should be allowed to use mobile termination rates only to recoup the actual cost of carrying other people’s calls.
The rates had been subsidizing other parts of their businesses but operators will now have to recoup the cost of activities such as investing in new networks from the retail market.
That could mean higher bills and an end to contract customers getting a new phone.
OFCOM admits it could even lead to customers being charged to receive calls — as they are on some US networks. In practice, however, mobile networks are likely instead to slash costs — possibly through job losses — and increase call charges, especially for pre-pay users who make up 60 percent of UK customers. The last time OFCOM reduced mobile termination rates, several networks increased prices for pre-pay users.
Morten Singleton, analyst at Collins Stewart, said: “One of the consequences of this move is the decreasing profitability of the prepaid customer.”
When OFCOM last cut rates, several operators warned that the price caps would lead to an end to subsidized handsets. Instead, price caps have led to the introduction of longer-term contracts with customers having to sign up for 18 months or two years.
PROVOCATIVE: Chinese Deputy Ambassador to the UN Sun Lei accused Japan of sending military vessels to deliberately provoke tensions in the Taiwan Strait China denounced remarks by Japan and the EU about the South China Sea at a UN Security Council meeting on Monday, and accused Tokyo of provocative behavior in the Taiwan Strait and planning military expansion. Ayano Kunimitsu, a Japanese vice foreign minister, told the Council meeting on maritime security that Tokyo was seriously concerned about the situation in the East China and South China seas, and reiterated Japan’s opposition to any attempt to change the “status quo” by force, and obstruction of freedom of navigation and overflight. Stavros Lambrinidis, head of the EU delegation to the UN, also highlighted South China Sea
The final batch of 28 M1A2T Abrams tanks purchased from the US arrived at Taipei Port last night and were transported to the Armor Training Command in Hsinchu County’s Hukou Township (湖口), completing the military’s multi-year procurement of 108 of the tanks. Starting at 12:10am today, reporters observed more than a dozen civilian flatbed trailers departing from Taipei Port, each carrying an M1A2T tank covered with black waterproof tarps. Escorted by military vehicles, the convoy traveled via the West Coast Expressway to the Armor Training Command, with police implementing traffic control. The army operates about 1,000 tanks, including CM-11 Brave Tiger
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, said it expects its 2-nanometer (2nm) chip capacity to grow at a compound annual rate of 70 percent from this year to 2028. The projection comes as five fabs begin volume production of 2-nanometer chips this year — two in Hsinchu and three in Kaohsiung — TSMC senior vice president and deputy cochief operating officer Cliff Hou (侯永清) said at the company’s annual technology symposium in Silicon Valley, California, last week. Output in the first year of 2-nanometer production, which began in the fourth quarter of last year, is expected to
Taiwan’s drone exports surged past US$100 million in the first quarter, exceeding last year’s full-year total, with the Czech Republic emerging as the largest buyer, the Ministry of Economic Affairs said. Exports of complete drones reached US$115.85 million in the period, about 1.2 times the total recorded for all of last year, the ministry said in a report. Exports to the Czech Republic accounted for about US$100 million, far outpacing other markets. Poland, last year’s top destination, recorded about US$11.75 million in the first quarter. Taiwan’s drone exports have expanded rapidly in the past few years, with last year’s total
RSS