By Mark Graham, 30 May 2001 17:35
NEWS Oftel's mobile pricing review, which is due out next month, has set the industry rumour mill turning with many tipping Vodafone as a likely target to be singled out and brought to book for over-charging. With Vodafone reporting record profits this week Oftel is understood to be considering whether to introduce a cap on charges following complaints the world's largest mobile operator is making excessive profits. However, analysts have sprung to the defence of the mobile operator, saying a price capping would be 'unjustified'. Robin Duke-Wooley, analyst at Schema, said: "Oftel and the government have already done their best to squeeze money out of the sector - they can't cry foul now." In the initial review issued in February, David Edmonds, director general of Oftel, said: "Vodafone has enjoyed persistently high profits which have not been substantially eroded by competition." However, Chris Gent, CEO of Vodafone, has stated he does not believe his company has an unfair advantage and told the Financial Times that everything his company has achieved "has all been fought for." Duke-Wooley said he suspects some "funny numbers" will appear, which will not take into account the high cost of 3G licences. "I very much doubt whether this review would include the costs associated with 3G licences, yet they [the government] insisted on immediate payment," he said. In a portentous twist for Vodafone, a number of the parties who advised Oftel in establishing a review criteria included BT, One2One and Orange.
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