ANACOM orders 44% reduction in mobile termination prices from 12 July

ANACOM has approved a reduction in mobile termination prices that mobile operators will have to implement as from 12 July. The new price for call terminations on mobile networks will be 0.42 eurocents per minute as a wholesale price between operators. This new price gives a reduction of 44% compared to the current price - 0.75 eurocents/minute.

The reduction in mobile termination rates is of great importance, since it remedies distortions in competition that undermine and damage the market, in particular smaller operators. When they exceed costs, termination prices, coupled with marked differences between retail prices for traffic within and outside the network of each operator, reinforce the network effect and generate a traffic imbalance to the detriment of smaller operators which deliver much more traffic to the networks of the largest operators, incurring higher costs as a result. The reduction in termination prices will help lower the financial burden of smaller operators, giving them the ability to improve their competitive capacity and become more attractive, with benefits for consumers in general.

The reduction in mobile termination prices also provides for the existence of tariffs which have the same prices regardless of the destination network, or which include free calls to all networks, helping to eliminate this network effect, since calls to numbers outside the operator's network are no longer penalised.

ANACOM's decision to intervene in mobile termination rates stems from the fact that operators have been identified as having significant market power and have never promoted reductions in these prices voluntarily. The current prices were decided by ANACOM in 2015, and updated in 2016 and 2017.

With the aim of promoting regulatory certainty, in the present draft decision, ANACOM identifies the maximum price of the wholesale mobile termination service for 2019 and 2020, updated based on current and forecast inflation data.