BT confirmed yesterday that it would be cutting the cost of calling a mobile phone from the beginning of September, to reflect cost cutting imposed on Vodafone, O2, Orange and T-Mobile by communications regulator Ofcom.

According to reports, the cuts could save consumers up to 36%, while some business calls to mobile phones could be limited to 30p an hour.

The four mobile operators were ordered to make the cuts following a long-running investigation into mobile call termination charges – the set fees that operators charge each other and fixed line telcos for connecting calls to their networks, fees which they pass on to the consumer.

Ofcom concluded that direct controls should be imposed on the charges to operators for terminating calls on the 2G mobile networks of Vodafone, O2, Orange and T-Mobile. Charges for 3G networks are not affected and the price cuts imposed will vary according to the particular spectrum used by the individual operators.

Vodafone and O2 will be forced to reduce their average termination charges from around 8p per minute to 5.63p per minute, while T-Mobile and Orange face cuts from around 9.5p per minute to 6.31p per minute.

The cuts will come into effect between the beginning of September 2004 and March 2005. Average charges must then remain at that level until March 2006.

BT announced yesterday that it would reflect the cuts in the prices it charges to consumers.

"This is great news for our customers," said Gavin Patterson, BT group managing director for consumer and ventures. "We said we would pass on all these savings to residential and business customers and we are doing so."

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