Text message pricing threat

UK mobile phone operators plan to charge each other a fee for every text message sent to a rival network, but they insist that the plan won't affect customer pricing.

Under the plan, agreed by all UK mobile operators, there will be an interconnection charge between the operators for each cross-network text message. According to a source close to one operator this could be as much as 3p per message.

The number of text messages sent throughout the UK last year topped 5.4 billion and is one of the biggest source of revenue for the network operators.

Orange, One2One, BT Cellnet and Virgin Mobile all confirmed to vnunet.com that they have agreed to introduce the charge, possibly from next month. Vodafone was unable to provide comment.

However the operators denied that the charge would lead to a rise in the cost of sending a text message, usually around 10p. They said the interconnection charges would cancel each other out as messages are sent between operators.

Steven Day, head of media relations at Virgin Mobile, said: "As far as the mobile phone user is concerned the introduction of an interconnection charge is not relevant and will not affect the price they pay for sending a text message."

A spokeswoman for One2One said: "In conjuction with the rest of the industry we are looking at charging for cross-network messages. But we have no plans to change the cost of text messaging for customers and they shouldn't notice any difference."

A spokeswoman for telecom watchdog Oftel said: "The operators have made plans to introduce charges. We don't know if this will reflect on charges to customers so can't really make a comment on this. But as far as we are aware these charges will work/cancel each other out."

"BT Cellnet and Vodafone are obliged to notify us of any changes they make and have not done so yet."

Nigel Deighton, an analyst with research group Gartner said costs may well rise. "It is easy for the operators to say now that the charge will not affect the consumer, but will this be the case in a year's time? It is easy to say that the costs will wipe each other out but in reality this is not always going to happen."

"There are different numbers of subscribers for each operator, catering for different segments of the market. A charge of 3p seems a bit high and could start to impact what customers are paying. This seems to be a negative message for the operators to be sending out," said Deighton.