UK mobile termination rates: down but not out

20 July 2010

The CC determination on mobile termination rates (MTRs), if implemented, would result in a cumulative 4% reduction in UK mobile industry revenue and EBITDA by the 2010/11 financial year, but a small boost to fixed line industry EBITDA

However, even this cut does not make up for the termination rate cut ‘holiday’ that the UK mobile industry has been enjoying for the last 2-3 years, with MTRs still high in relation to retail tariffs by historic standards

On the positive side (for the MNOs), this means that increased competitive pricing pressure is unlikely in the short term; on the negative side we still expect substantial further cuts from April 2011. These cuts are broadly lagging those in the rest of Europe, so there is no negative read-across for most European MNOs

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