Fast UK 3G Rollout Hampered by Price Limits

date: September 26, 2001

UK telecom watchdog Oftel has imposed new price limits on calls to mobile phones, cutting bills by £800million over four years that will have a massive impact on rolling out 3G networks for operators, who already faces huge financial pressures.

Its decision to cut prices by inflation minus 12% per year for four years will reduce the revenues of the four operators by about 600million. The price limit will mean UK operators will not be able to rise call prices to fund 3G rollouts.

The control will cover Orange and One2One, rather than just Vodafone and BT Cellnet as under its current rules and who all holds a 3G license in the UK.

The four operators had urged Oftel to take into consideration of the massive cost of rolling our 3G services and Oftel therefore did not impose an additional one-off reduction in prices as it did in its last pricing review.

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