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PAYG prices may change due to Ofcom price cap

Everything Everywhere not happy with Ofcom
Everything Everywhere not happy with Ofcom

Everything Everywhere, the Orange and T-Mobile partnership, has revealed that Ofcom's decision to introduce a new lower cap on the rate networks can charge landline operators and rival mobile phone companies to connect calls to mobile phones may have an effect on pay-as-you-go customers.

Ofcom's new ruling means that over the next four years, and starting 1 April, there will be a significant reduction in mobile termination rates – something that will affect the big four mobile operators: 3UK, O2, Everything Everywhere and Vodafone.

Vulnerable customers

Everything Everywhere contacted TechRadar about the new ruling and said: "We are disappointed with Ofcom's decision. Our concerns focus on the impact of the decision to our vulnerable pay-as-you-go customers.

"By applying pure LRIC methodology in setting call termination rates going forward, Ofcom has suggested we recover a larger share of our costs from retail charges. This may force us to change the pay-as-you-go model as we know it as a large number of these customers will now become uneconomical – making the way our consumers currently buy, use and enjoy their mobiles radically different going forward."

TechRadar is currently speaking to the rest of the big four to gauge their decision on the new rules.