The cuts were ordered by Oftel following a ruling by the Competition Commission in January. They applied to termination charges - the set fees that operators charge each other and fixed line telecoms companies for connecting calls to their networks, fees which they pass on to the consumer.
A 15% cut in the termination charges, the first phase in a planned 50% reduction over three years, was due to take effect yesterday. Vodafone, Orange and T-Mobile owner Deutsche Telecom lost an action in June in which they asked a court to block the imposed cuts.
According to the BBC the cuts should translate to a reduction in the cost of calls between mobile networks from 24p to 19p per minute, and a reduction in the cost of a call from a landline phone to a mobile from 17p per minute to 12p.
According to the Online Evening Times, BT expects that consumers will not see any benefits until October, at the earliest. A spokesman for BT told the news site that the mobile operators "have only advised us of permanent reductions in their charges in the last couple of days."
He said, "They know we need proper notice to make the changes and they have not given us what we normally need," and added, "It is not possible to change our retail prices on the same day as the termination rates change."
Oftel estimates that BT overcharges by £500 million in calls to mobiles. But the mobile operators – which Oftel says are overcharging by £250 million – have discretion as to whether to pass on the cuts to consumers – and, as consumer bodies have feared, it seems that they will merely transfer the costs to other services.
According to the article at ThisIsLondon.co.uk, Vodafone is the only network that has altered prices in line with Oftel's demands; but according to the article by Daily Mail writer Sean Poulter, "it is thought that any gains for customers have been offset by higher charges for handsets and raised pay-as-you-go bills."
An Orange spokesman told the writer that the firm had no savings to pass on; and T-Mobile and O2 said they had no plans to cut bills.
Meanwhile, the new Communications Act 2003 came into force today. It means that, from today:
all telecoms licences have been abolished, and replaced by a set of requirements on operators of electronic communications networks and the service providers that use them;
the regulatory framework is extended to cover the converging communications services including interactive television, e-mail, text messaging and voice telecoms services; and
current regulation that applies to specific companies will remain in place through a series of continuation notice published today, until the completion of Oftel's market reviews.
The new framework provides the basis for regulation by Ofcom when it assumes regulatory responsibility from Oftel and other bodies at the end of 2003.
Stephen Timms, e-commerce Minister said today: "The Communications Act is the lynchpin to liberalising a market currently worth over £12 billion of investment a year."