Cuts ring changes for mobile phone price war

A SUMMER mobile phone price war looked on the cards as Vodafone announced it was slashing off-peak consumer call charges by 50 per cent.

"We would be very surprised if our rivals did not follow suit in some way," said Mike Caldwell, manager of corporate communications for Vodafone. "It's part of the trend of mobiles getting cheaper to use."

But the Telecom Users' Association warned there was a long way to go before consumers will get a good deal from mobiles.

Vodafone said that it was cutting off-peak calls to 5p from 10p from 1 June and tariffs between 7pm and 8am would start from only 2p a minute for those subscribing to its local call saver option.

"It's the first time that you have been able to make a call that is at a cheaper rate than BT on a mobile," added Mr Caldwell.

Around 5 billion minutes are spent on mobile phones every year and the number is growing by 40 per cent. In January the networks revealed record connections in the run-up to Christmas and currently 9 million people own mobile phones.

But the mobile phone industry was criticised as being a "rip-off" for customers two months ago when Oftel announced it was referring it to the Monopolies and Mergers Commission over high prices calling mobiles from landlines. A spokesman for Oftel said yesterday that the MMC inquiry was expected to cover other areas as well.

A spokeswoman for Orange said yesterday that they welcomed Vodafone's move. "We're actually pleased to see Vodafone following the examples set by Orange over value for money and services tailored to individual needs. The competitive nature of the telecommunications market can only benefit the customer." However she said the company had no plans to change its tariffs as a result of Vodafone's move.

Similarly One2One said that its services offered better value for money and it had no plans to follow Vodafone. "I don't think the mobile phone market has ever been cosy," said a spokesman.

The other telecom giant, Cellnet, said it was already planning to launch new tariffs on 9 June. "We believe our existing tariff structure is competitive and offers value for money," said a spokesman. "We review our tariffs in order to ensure we remain competitive but there is no immediate plan to do so."

Despite Vodafone's action the Telecom Users' Association said yesterday that telecom companies had a long way to go before they could be called "consumer responsive".